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Press release 7.12.2005

Research and development expenditure growing slowly

Nearly EUR 5.3 billion was expended on research and development in 2004. R&D expenditure grew by five per cent, while in 2003 growth was around four per cent. R&D expenditure rose by EUR 250 million from the year before. Although R&D expenditure of business enterprises increased most, by over EUR 150 million, enterprises' share of R&D expenditure fell slightly, to 70 per cent. The data appear from Statistics Finland's publication Tutkimus- ja kehittämistoiminta 2004 (Research and Development 2004, in Finnish only).

Growth was fastest in the higher education sector, where R&D expenditure grew by eight per cent and the expenditure exceeded EUR one billion. The higher education sector now accounts for one fifth of all R&D expenditure, up by two percentage points from 2000. R&D expenditure of the rest of the public sector rose again to the level of 2002 after having contracted in the year before.

The GDP share of R&D expenditure was 3.5 per cent last year. Finland's investment in R&D did not grow much from the previous year. It is estimated that growth of R&D expenditure will also be fairly slow in 2005 and the GDP share will remain on level with the previous year.

By international comparison, the GDP share of R&D expenditure in Finland is still among the top in the world, preceded only by Israel (4.9%) and Sweden (4.0%). In 2003, 1.9 per cent of the GDP of the present EU area was used on research and development. In Japan (3.2%) and the United States (2.6%) clearly more is invested in R&D than in the EU area.

R&D expenditure by sector and GDP share of R&D expenditure in 1998-2004 and estimate for 2005

Year Business enterprises   Public sector**    Higher education sector*** Total GDP share of R&D
e million % e million % e million % e million %
1998 2,252.8 67.2 443.9 13.2 657.8 19.6 3,354.5 2.86
1999 2,643.9 68.2 470.1 12.1 764.8 19.7 3,878.8 3.21
2000 3,135.9 70.9 497.4 11.2 789.3 17.8 4,422.6 3.38
2001 3,284.0 71.1 500.9 10.8 834.1 18.1 4,619.0 3.38
2002 3,375.1 69.9 529.7 11.0 925.6 19.2 4,830.3 3.43
2003 3,527.9 70.5 515.4 10.3 961.7 19.2 5,005.0 3.48
2004 3,683.5 70.1 530.1 10.1 1,039.8 19.8 5,253.4 3.51
2005* 3,770.3 70.0 538.4 10.1 1,079.7 20.0 5,388.4 3.52

*      Estimate on the basis of inquiry responses and other calculations
**     Incl. PNP (private non-profit sector)
***   Incl. polytechnics since 1999
**** GDP 2003 and 2004 preliminary data of Statistics Finland, GDP 2005 is an estimate by the Ministry of Finance

Two thirds of R&D personnel researchers

In 2004, 76,700 persons worked in research and development (R&D), which is a couple of per cent more than one year before. Increase on the previous year was 1,900 persons.

In the data for 2004 R&D personnel are for the first time divided into researchers and other R&D personnel. Two thirds of the R&D personnel were researchers, and one third were mainly working at R&D related expert or support tasks. The proportion of researchers is naturally largest in the higher education sector, where it was 72 per cent of the R&D personnel. In the public sector and its major research institutes the proportion of researchers was smaller, 55 per cent. In enterprises two thirds of the R&D personnel were researchers.

Source: Tutkimus- ja kehittämistoiminta 2004 (Research and Development 2004, in Finnish only). Statistics Finland

Inquiries: Mr Vesa Hämäläinen +358 9 1734 2594,

Director in charge: Ms Kaija Hovi