EU industrial investment in research and development on the rise

The European Union has published the 2022 edition of the EU Industrial R&D Investment Scoreboard, which shows that European industry has resumed investment in research and development. It shows an increase of 8.9% in 2021 compared to a pandemic-induced decline of -2.2% in 2020.

The EU continues to lead the world in R&D investments in the automotive sector, where the transformation towards electric vehicles and digitalisation is fully underway in both established and newer start-ups. The scoreboard also shows a broad sectoral diversification in the EU, especially in comparison to the US, where R&D investment is concentrated in information and communication technologies (ICT).

Globally, private sector R&D investment grew considerably beyond pre-pandemic levels (by 14.8% in 2021 compared to 2020). For the first time since the 2004 Scoreboard, the total R&D investment of the world’s top 2,500 companies exceeded one trillion euros. This was a major change in that, together, Chinese companies in the Scoreboard now have a slightly higher total global share than EU companies (17.9% Chinese and 17.6% EU respectively).

Entering the global tech race

The scoreboard highlights the intensification of the global technology race in the four key sectors that account for more than three-quarters of total business R&D activity:

• ICT producers (22.6%)
• Health industries (21.5%)
• ICT services (19.8%)
• Automotive sector (13.9%)

Encouraging trends and policies on industrial investments

Many EU Member States have major R&D companies in sectors such as aerospace, defence, and chemicals, as well as the automotive, ICT, and health industries. The top 1000 EU companies include a considerable number of small and medium-sized enterprises (SMEs) in the health and ICT sectors that spurred R&D growth in 2021.

This is a positive signal for important target groups of the New European Innovation Agenda, which, among other things, addresses expansion and growth in cutting-edge and emerging deep-tech technologies and triggers cross-sector spillovers with the support of the European Innovation Council.

A patent-based positioning of companies in the Scoreboard in terms of green technologies and circular economy technologies shows that EU and US companies are leaders in high-value patents. In addition, the EU is also a leader in terms of circularity-relevant inventions.

The 2022 report analyses performance against the relevant UN Sustainable Development Goals (SDGs). And EU companies scored the highest on most of the SDGs, with progress since last year. From a sectoral perspective, companies in the chemical and automotive sectors made, on average, significant progress on the SDGs. The review also highlights the high potential for deep technology solutions to address global challenges.

Background on the EU Industrial R&D Investment Scoreboard

The EU Industrial R&D Investment Scoreboard has been published annually since 2004; this is its 19th edition. It provides the latest economic and financial information based on the latest published audited accounts of the top 2 500 global R&D investors, including the top 1 000 in the EU.

Alongside the Scoreboard, the Commission publishes annually the EU Survey 2022 on trends in industrial R&D investment. Although the Scoreboard data do not yet show any impact from the war in Ukraine, the survey report mentions some early effects, such as delays in some existing R&D projects in the aerospace and defence sector, in construction, in the health industries, and the automotive sector.

Some companies also claimed to have initiated new R&D projects as a direct impact of the war. The 2022 EU Survey on Industrial R&D Investment Trends was sent to the top 1,000 EU R&D investors in the 2021 Scoreboard and took place between June and September 2022.