GIPC Study Titled "IP Creates Jobs for America"

Statement

I'm pleased to be here for the release of the U.S. Chamber's Global Intellectual Property Center's (GIPC) 2012 state intellectual property jobs study. This new study will help us understand the direct and indirect benefits of intellectual property in every state across the country. Intellectual property -- patents, copyrights and trademarks -- plays a foundational role in the United States with respect to job creation, economic growth, and the balance of trade. This state-by-state analysis highlights how intellectual property is a major contributor to the nation's economic health and prosperity.

At a Judiciary Committee hearing a few weeks ago, we discussed a recent report by the Department of Commerce that measured the huge economic impact of intellectual property on the United States economy. That report found that "the entire U.S. economy relies on some form of intellectual property, because virtually every industry either produces or uses it."

Here are just some of the numbers. In 2010, 27.7 percent of all jobs in the United States were directly or indirectly attributable to IP-intensive industries. Specifically, IP-intensive industries directly supported 27.1 million American jobs and indirectly supported another 12.9 million jobs. Jobs in IP-intensive industries are paid 42 percent higher than in other industries. Further, IP-intensive industries accounted for approximately $5.06 trillion in value added, or 34.8 percent of U.S. gross domestic product. Merchandise exports of IP-intensive industries totaled $775 billion, or 60.7 percent of all U.S. exports.

The GIPC study delves further into the Commerce Department numbers to quantify the role of intellectual property in the individual states. The study expands the Commerce Department's analysis by looking at the "induced effects, or the economic contributions of intellectual property outside the supply chain and its broad impact on the U.S. economy."

Basically, the study found that each dollar spent in direct expenditures for IP-intensive industries creates a chain reaction of indirect spending with spillover benefits to other sectors in our economy. The data shows that intellectual property is an important economic driver in all states, big and small.

Let me take my home state of Iowa as an example. Innovation and creativity thrive in Iowa. We have companies -- like Pioneer, John Deere and Vermeer -- that successfully produce and utilize intellectual property. We have cutting edge research and development going on at our Iowa educational institutions and laboratories. And we have significant creative works coming out of Iowa artists and authors.

The GIPC study indicates that in Iowa, intellectual property supports 663,243 million jobs, 266,329 of which are classified as direct intellectual property jobs and 396,914 of which are classified as indirect intellectual property jobs. This number amounts to 49 percent of Iowa's private sector jobs.

With respect to output, the study finds that IP-intensive companies generate 61 percent greater output per employee than other companies. Specifically, the study finds that the average output per private sector employee is $71,274, while the average output per intellectual property employee is I'm pleased to be here for the release of the U.S. Chamber's Global Intellectual Property Center's (GIPC) 2012 state intellectual property jobs study. This new study will help us understand the direct and indirect benefits of intellectual property in every state across the country. Intellectual property -- patents, copyrights and trademarks -- plays a foundational role in the United States with respect to job creation, economic growth, and the balance of trade. This state-by-state analysis highlights how intellectual property is a major contributor to the nation's economic health and prosperity.

At a Judiciary Committee hearing a few weeks ago, we discussed a recent report by the Department of Commerce that measured the huge economic impact of intellectual property on the United States economy. That report found that "the entire U.S. economy relies on some form of intellectual property, because virtually every industry either produces or uses it."

Here are just some of the numbers. In 2010, 27.7 percent of all jobs in the United States were directly or indirectly attributable to IP-intensive industries. Specifically, IP-intensive industries directly supported 27.1 million American jobs and indirectly supported another 12.9 million jobs. Jobs in IP-intensive industries are paid 42 percent higher than in other industries. Further, IP-intensive industries accounted for approximately $5.06 trillion in value added, or 34.8 percent of U.S. gross domestic product. Merchandise exports of IP-intensive industries totaled $775 billion, or 60.7 percent of all U.S. exports.

The GIPC study delves further into the Commerce Department numbers to quantify the role of intellectual property in the individual states. The study expands the Commerce Department's analysis by looking at the "induced effects, or the economic contributions of intellectual property outside the supply chain and its broad impact on the U.S. economy."

Basically, the study found that each dollar spent in direct expenditures for IP-intensive industries creates a chain reaction of indirect spending with spillover benefits to other sectors in our economy. The data shows that intellectual property is an important economic driver in all states, big and small.

Let me take my home state of Iowa as an example. Innovation and creativity thrive in Iowa. We have companies -- like Pioneer, John Deere and Vermeer -- that successfully produce and utilize intellectual property. We have cutting edge research and development going on at our Iowa educational institutions and laboratories. And we have significant creative works coming out of Iowa artists and authors.

The GIPC study indicates that in Iowa, intellectual property supports 663,243 million jobs, 266,329 of which are classified as direct intellectual property jobs and 396,914 of which are classified as indirect intellectual property jobs. This number amounts to 49 percent of Iowa's private sector jobs.

With respect to output, the study finds that IP-intensive companies generate 61 percent greater output per employee than other companies. Specifically, the study finds that the average output per private sector employee is $71,274, while the average output per intellectual property employee is $114,663. IP-intensive companies create $56.4 billion in output, or 50 percent of output in Iowa.

According to the study, Iowa has $13.2 billion in total exports, with $9.2 billion in intellectual property exports. This is calculated to be 69.7 percent of Iowa's total exports. With respect to wages, IP-intensive companies in Iowa pay 31 percent higher wages than other companies.

The study ranks Iowa at number 29 amongst the states in terms of research and development dollars, with $1.5 billion in research and development expenditures and $1,111 in research and development expenditures per employee. The study also finds that in 2010, 763 patents were awarded, and that there were 663,244 science and engineering jobs, which is 3.2 percent of Iowa private sector jobs.

The data compiled in the Commerce Department report and the GIPC study underscores how pivotal intellectual property is to the U.S. economy. That's why we should care about whether our intellectual property is being stolen or counterfeited.

Intellectual property theft has increased dramatically, causing severe harm to IP-intensive businesses all across the country. According to one report, domestic production and consumption of counterfeit and pirated products cost the U.S. economy $215 billion annually, while counterfeit and pirated products account for $360 billion in losses in international trade annually.

Because intellectual property is such an engine for innovation and job growth in the United States, and because so much money is being lost to counterfeiting and piracy, it's safe to conclude that we need to do all we can to encourage, invest in, and protect American intellectual property. I agree with the study that "Iowa's innovative economy depends on strong protection of intellectual property for a vibrant economy, job creation, and the ability of the state's engineers, inventors, scientists and artists to protect their innovation."

I believe that the GIPC study will be a valuable resource for lawmakers in Congress and policy makers in the executive branch and the States, as we consider ways to promote and protect this vital part of our economy. We all want to know how to foster job creation, and this study will assist us in our work.
$114,663. IP-intensive companies create $56.4 billion in output, or 50 percent of output in Iowa.

According to the study, Iowa has $13.2 billion in total exports, with $9.2 billion in intellectual property exports. This is calculated to be 69.7 percent of Iowa's total exports. With respect to wages, IP-intensive companies in Iowa pay 31 percent higher wages than other companies.

The study ranks Iowa at number 29 amongst the states in terms of research and development dollars, with $1.5 billion in research and development expenditures and $1,111 in research and development expenditures per employee. The study also finds that in 2010, 763 patents were awarded, and that there were 663,244 science and engineering jobs, which is 3.2 percent of Iowa private sector jobs.

The data compiled in the Commerce Department report and the GIPC study underscores how pivotal intellectual property is to the U.S. economy. That's why we should care about whether our intellectual property is being stolen or counterfeited.

Intellectual property theft has increased dramatically, causing severe harm to IP-intensive businesses all across the country. According to one report, domestic production and consumption of counterfeit and pirated products cost the U.S. economy $215 billion annually, while counterfeit and pirated products account for $360 billion in losses in international trade annually.

Because intellectual property is such an engine for innovation and job growth in the United States, and because so much money is being lost to counterfeiting and piracy, it's safe to conclude that we need to do all we can to encourage, invest in, and protect American intellectual property. I agree with the study that "Iowa's innovative economy depends on strong protection of intellectual property for a vibrant economy, job creation, and the ability of the state's engineers, inventors, scientists and artists to protect their innovation."

I believe that the GIPC study will be a valuable resource for lawmakers in Congress and policy makers in the executive branch and the States, as we consider ways to promote and protect this vital part of our economy. We all want to know how to foster job creation, and this study will assist us in our work.

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