The States and IP

On May 23, the U.S. Chamber of Commerce Global Intellectual Property Center (GIPC) published a new report titled “IP Creates Jobs for America.” The analysis breaks out the impact of intellectual property on jobs, output, wages, and exports by state.

Mark Elliot, executive vice president of the GIPC, explained, “Recent research by the Department of Commerce has shown that innovation and creativity are key drivers for economic growth and prosperity, with intellectual property-intensive industries driving America's jobs and economic growth. Our study expands this data to capture the economic value of intellectual property outside the supply chain. This report makes the benefits of IP tangible, demonstrating that a wide cross-section of industries employing tens of millions of Americans reaching every corner of the U.S. hinge on intellectual property rights and enforcement thereof.”

The GIPC study found that, nationally, IP-intensive industries accounted for 55.7 million direct and indirect jobs, generated more than $5 trillion in GDP, and produced 74 percent of total U.S. exports.

In terms of the states, consider what IP means to the four largest states.

• In California, 7.38 million jobs, or 55 percent of private sector employment, are supported by IP, while 58 percent, or $922.8 billion, of economic output is created by IP-intensive firms. In addition, 76.8 percent of exports are IP exports. Average wages in IP-intensive companies are higher than non-IP businesses – $65,171 and $47,571, respectively.

• In Texas, 4.61 million jobs, or 49 percent of private sector employment, are supported by IP, while 54 percent, or $541.3 billion, of economic output is created by IP-intensive firms. In addition, 85.4 percent of exports are IP exports. Average wages in IP-intensive companies are higher than non-IP businesses – $55,148 and $41,320, respectively.

• In New York, 2.78 million jobs, or 36 percent of private sector employment, is supported by IP, while 49 percent, or $385.8 billion, of economic output is created by IP-intensive firms. In addition, 63.7 percent of exports are IP exports. Average wages in IP-intensive companies are higher than non-IP businesses – $69,581 and $53,660, respectively.

• In Florida, 2.05 million jobs, or 28 percent of private sector employment, is supported by IP, while 36 percent, or $225.5 billion, of economic output is created by IP-intensive firms. In addition, 75.3 percent of exports are IP exports. Average wages in IP-intensive companies are higher than non-IP businesses – $49,550 and $36,366, respectively.

To get details on your state, visit the study’s website at www.IPCreatesJobs.com.

Once again, we have overwhelming evidence of how important intellectual property is to the U.S. economy, including for jobs, wages and exports.

That, of course, reinforces the importance of the government’s responsibility to protect and enforce intellectual property rights. And that is both a domestic and an international responsibility. As the global economy expands, including with stronger growth in developing nations, the U.S. must be at the forefront of advancing free trade, while making clear that such trade, and economic prosperity in general, cannot expand robustly if property, including IP, is not properly protected.

_______________

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His new book is “Chuck” vs. the Business World: Business Tips on TV.