Industrial biotech employment to triple to 1.5 million in the EU by 2030: new report

September 28, 2016 |

bd-ts-092916-bamm-bamm-smIn Brussels, EuropaBio released a report concluding that Industrial Biotech contributes over €30 billion to the EU economy and around 500 000 jobs. The new study was launched in the European Parliament as part of a series of activities across Europe celebrating European Biotech Week.

The Report’s employment data

The report found that the core IB sector employed about 94.000 FTEs in 2013. Upstream of the IB sector, at the suppliers of goods and services, the associated employment amounts to about 269.000 FTEs. Downstream of the IB sector, at companies who process and integrate IB sector outputs, some 97.000 FTEs are employed. In total, the sector employs 480,000 along the value chain.

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In all, that’s 4 jobs in the value chain for every direct job created, and EuropaBio comments that “this high job multiplier is a general characteristic of the chemical and pharmaceutical sectors, in which the IB sector is embedded, but is augmented due to the specific characteristic of the IB sector with regard to its sourcing of raw materials in biomass sectors, which creates many more upstream jobs than sourcing fossil resources.”

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Employment Outlook in 2030

The study found that employment in the IB value chain may increase to well above one million FTEs under two different growth scenarios for the IB sector have been considered.

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The first is the extrapolation of the historical growth rate of IB production observed in the Key Enabling Technologies.  The second is the market forecast made for the IB sector in the context of the BIO-TIC market roadmap.

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EuropaBio noted that “when we apply the growth rates from both sources to current employment and calculate expected employment by 2030, we find that total employment for IB will lie between 900.000 FTEs (BIO-TIC scenario) and 1.500.000 FTEs (KETs Observatory scenario).”

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IB within the chemical and pharma sectors

The report noted that as of 2013, the share of IB related employment in total chemicals and pharmaceutical amounted to about 5%, and is expected to jump to between 10% and 15% by 2030, highlighting the importance of IB for maintaining employment in these key strategic EU sectors. The IB market in the EU is expected to contribute between €57,5 billion and €99,5 billion to the European Economy by 2030.

Outlook – employment

A projection for employment in 2030 is made based on two sources of IB sector growth forecasts: For these two scenarios, results indicate that employment in the IB value chain will reach between 900.000 and 1.5 million by 2030. The market forecast of 4% compounded annual growth rate towards 2030 calculated in the BIO-TIC project.

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Revenue outlook

A projection for revenue was focused on the core IB sector only, to avoid the problem of double-counting upstream and downsteam indirect impacts. The value-add represented by the industry, the study found amounted to €31,5B in 2013, and will increase to between €57,5B and €99,5B by 2030.

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The Digest’s Take

Interesting that renewable chemicals and biomaterials are so much more impactful in the EU, and that the growing revemue will support, overall, a tripling of the employment base. Not many sectors offer the opportunity to add a million new jobs to the economy by 2030.

Key issues? Finance, to support not only the companies but the infrastructure — it has to move beyond the finite resource of government direct investment and loan guarantees. Also, training. Not much doubt that the universities will roll out the biology PhDs, but what about the management teams, marketing — above all, the engineering to design and build all the production capacity. It’s a product-based industry and three times as much revenue generally means three times as much steel in the ground — and a broad expansion into novel production organisms.

Reaction from the stakeholders

Commenting on the report, Stephan Tanda, Chair of EuropaBio’s Industrial Biotech Council and Managing Board member of Royal DSM said “Industrial biotech is one of the EU’s technological strengths. A very potent technology, able to solve societal needs and contribute to the transition toward the sustainable use of renewable raw materials and the reduction of required raw materials, energy and waste. Not surprisingly, these figures for jobs and growth are just the beginning and they are expected to grow to between 900 000-1.5 million jobs with an accompanying economic contribution of up to almost €100 billion by 2030’.

‘Our study shows that for every 1 job created in industrial biotech 4 more jobs are created elsewhere in the economy’ added EuropaBio’s Industrial Biotech Director, Joanna Dupont-Inglis. ‘Industrial biotech is increasingly revitalising rural, coastal and de-industrialised areas of Europe by adding value to EU-grown renewable raw materials, which creates new jobs and attracts investment. In a post-Paris COP21 world, where the EU is seeking technologies that will not only stimulate economic recovery but will also deliver benefits for consumers, the environment and the climate, industrial biotech is delivering on all levels.’

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