Trevor Little

The USPTO and Economics & Statistics Administration have released a follow-up to the ground-breaking 2012 study into the economic contribution made by intellectual property to the US economy. The 59-page report also identifies the regions and industries where trademark-intensity resides.

In 2012 we reported on the US Department of Commerce’s lengthy report identifying the sectors that generate the most intellectual property and their impact on the US economy. The report initiated a growing body of research work into the economic contribution made by IP across the world – in 2013 the European Commission published its own study into the economic impact of IP across the EU, with the EUIPO building on this by releasing a series of studies examining the reverse, evidencing the economic impact of counterfeiting and piracy on particular industry sectors (its latest study, released today, reveals that 4.4% of legitimate sales of pharmaceuticals are lost each year in the EU due to counterfeiting, resulting in losses of €10.2 billion in revenues and 37,700 jobs).

Four years after the ground-breaking US report, Intellectual Property and the US Economy: 2016 Update evidences the growing contribution made by IP-intensive industries in the US in the time since. In short, it finds that IP-intensive industries continue to be an important and integral part of the US economy and account for more jobs and a larger share of US gross domestic product (GDP) in 2014 compared to what that observed for 2010 (the data set used in the 2012 report).

The report identifies 81 industries as IP-intensive, which directly accounted for 27.9 million jobs in 2014, up 0.8 million from 2010. Drilling down it reveals:

  • Revenue specific to the licensing of IP rights totalled $115.2 billion in 2012, with 28 industries deriving revenues from licensing.
  • Total merchandise exports of IP-intensive industries increased to $842 billion in 2014 from $775 billion in 2010 (however, because non-IP-intensive industries’ exports increased at a faster pace, the share of total merchandise exports from IP-intensive industries declined to 52% in 2014 from 60% in 2010).
  • The value added by IP-intensive industries increased substantially in both total amount and GDP share between 2010 and 2014. IP-intensive industries accounted for $6.6 trillion in value added in 2014, up more than $1.5 trillion (30%) from $5.06 trillion in 2010. The share of total US GDP attributable to IP-intensive industries increased from 34.8% in 2010 to 38.2% in 2014.
  • While IP-intensive industries directly accounted for 27.9 million jobs either on their pay-rolls or under contract in 2014, they also indirectly supported 17.6 million more supply chain jobs. In total IP-intensive industries support about 30% of all employment.
  • While jobs in IP-intensive industries increased between 2010 and 2014, non-IP-intensive jobs grew at a slightly faster pace. Consequently, the proportion of total employment in IP-intensive industries declined slightly to 18.2% (from 18.8% in 2010).

For trademark practitioners there is a lot of data to digest. Trademark-intensive industries are the largest in number and contribute the most employment with 23.7 million jobs in 2014 (up from 22.6 million in 2010).

As to where these jobs are located, 16 states demonstrated above average levels of trademark intensive industries, with Connecticut, Vermont and Wisconsin at leading the way, followed by the likes of California, Massachusetts, Minnesota, New York New Jersey and Washington.

Average trademark wages also out-paced those in non-IP intensive industries – the average weekly wage in trademark-intensive industries of $1,236, comparing favourably to the $896 in non-IP intensive industries.

Between 2010 and 2014, the share of GDP attributed to trademark-intensive industries increased to 34.9% (from 30.8%) accounting for $6.1 trillion in value added in 2014 (up from $4.5 trillion in 2010).

Turning to the top 50 trademark registering companies, the report highlights the sectors these are drawn from, providing insight into the sectors in which trademark activity is high:

Industry Title -- No of top 50 appearances

Other miscellaneous manufacturing -- 28

Pharmaceutical and medicine manufacturing -- 28

Soap, cleaning compound, and toilet preparation manufacturing -- 21

Motion picture and video industries  -- 13

Radio and television broadcasting -- 13

Audio and video equipment manufacturing -- 12

Gambling industries -- 10

Grocery stores  -- 10

Insurance carriers -- 9

Sugar and confectionery product manufacturing -- 7

Department stores -- 6

Interestingly, the educational gap between workers in IP-intensive and other industries observed in 2010 had virtually disappeared by 2015. The share of workers in IP-intensive industries with a bachelor’s degree or higher fell from 42.4% in 2010 to 39.8% in 2015, whereas that percentage increased from 34.2% to 38.9% for workers in non-IP-intensive industries. Trademark-intensive industries were a key contributor to this narrowing of the educational attainment gap. In 2015, the share of workers with college education or higher in trademark-intensive industries fell to 36.6% (from 38.8%) – in contrast to patent and copyright-intensive industries, which both saw a rise in college education levels.

As with similar studies, the findings will be most used by policy-makers and those seeking to influence government decision-making. However, it provides practitioners with interesting insights into how trademark-intensive industries are contributing to economic performance, as well as the sectors and regions where trademark intensity resides. 

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