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Intellectual Property and the U.S. Economy: 

Industries in Focus

Prepared by the

Economics and Statistics Administration

and the

United States Patent and Trademark Office

U.S. Department of Commerce

March 2012

Intellectual Property and the U.S. Economy: 

Industries in Focus

Foreword

As President Obama has said, if we are to win the future and be successful in an

increasingly competitive international market, the United States of America must

innovate. Innovation, the process through which new ideas are generated and put into

commercial practice, is a key force behind U.S. economic growth and national competitiveness.

Likewise, U.S. companies’ use of trademarks to distinguish their goods and services from those

of competitors enables firms to capture market share and further strengthen our economy.

The dynamics of a globally connected market mean that the United States will need to

develop the brightest minds with the most advanced training to make the best products.

The Obama Administration’s determination to promote innovation and protect intellectual

property (IP) rights will harness the inherent drive and ingenuity of the American people in

meeting that goal. 

Innovation protected by IP rights is key to creating new jobs and growing exports. Innovation

has a positive pervasive effect on the entire economy, and its benefits flow both upstream and

downstream to every sector of the U.S. economy. Intellectual property is not just the final

product of workers and companies—every job in some way, produces, supplies, consumes,

or relies on innovation, creativity, and commercial distinctiveness. Protecting our ideas and

IP promotes innovative, open, and competitive markets, and helps ensure that the U.S. private

sector remains America’s innovation engine.

There is a broad range of industries that benefit from IP, both directly and indirectly, and for

every innovation in a given industry, generally there are corresponding economic opportunities

for other industries to bring advances to the public. Examples of these complementary

industries include the computer manufacturer that uses inputs made by semiconductor firms to

make the hardware that is needed to run applications made by software companies, the Internet

company that generates the on-line applications to distribute copyrighted music, and the auto

manufacturer that incorporates patented energy-saving engines in the cars it sells. In each of

these cases, industries are supported by the complementary products and services of another

industry, so each industry is in a position to benefit from the safeguard of the IP underpinning

their business models. When companies are more confident that their ideas will be protected,

they have the incentive to pursue advances that push efficiency forward, costs down, and

employment up. 

Intellectual Property and the U.S. Economy: Industries in Focus

i
Further evidence of this domino effect is seen as downstream businesses benefit from innovative

products that lower their costs and improve their processes and finished articles. For example, a

more precise machine could make manufacturing pharmaceuticals safer; a more reliable software

program could improve military hardware while making it more affordable; or a clearer sound

system could boost the quality of a recording studio’s album. In each of these cases, and many

more, the innovation feeds directly into a new finished article or service that has commercial

value. The innovation may increase customer satisfaction through a higher quality product or

service or decrease production costs. This additional value can help businesses protect earnings

that can support their labor force. 

Finally, in addition to the companies that produce, complement, and consume the innovation,

logistical and supporting businesses are required to keep these companies up and running.

These entities include marketing firms that inform consumers about innovations that can save

time and money, packaging companies that ship advanced goods to retailers, and Internet

service providers that create and maintain the communications pathways needed to compete in

an increasingly on-line world. 

This report by the Economics and Statistics Administration (ESA) and the U.S. Patent and

Trademark Office (USPTO) of the U.S. Department of Commerce attempts to identify the

first-order players that are growing IP in the U.S. economy and protecting their innovations

through patents, trademarks, or copyrights. These IP-intensive industries support tens of

millions of jobs and contribute several trillion dollars to our gross domestic product (GDP).

This report not only estimates the contributions of these industries to our economy, but also

gauges the ripple, or domino, effects they have on employment throughout the economy.

They represent the leading edge of our economy that is built on the ingenuity of the American

people and their future growth is increasingly dependent on effective protection of IP rights

both here and abroad. 

_______________________________ __________________________________

Rebecca M. Blank David J. Kappos

Acting Deputy Secretary of Commerce Under Secretary for Intellectual Property 

and and 

Under Secretary for Economic Affairs, Director, U.S. Patent and Trademark Office 

Economics and Statistics Administration

Intellectual Property and the U.S. Economy: Industries in Focus

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Intellectual Property and the U.S. Economy: 

Industries in Focus

Intellectual Property and the U.S. Economy: Industries in Focus

iii

Economics and Statistics 

Administration

Rebecca M. Blank

Acting Deputy Secretary of Commerce

and 

Under Secretary for Economic Affairs

U.S. Patent and

Trademark Office

David J. Kappos

Under Secretary for Intellectual Property

and

Director, U.S. Patent and Trademark Office 

ACKNOWLEDGEMENTS

The Project Team would especially like to thank Victoria Espinel, U.S. Intellectual Property

Enforcement Coordinator, for suggesting that we undertake this project and for her assistance.

Alis Asadurian from ESA and Gabriel Medeiros from the Bureau of Economic Analysis (BEA)

made significant contributions to the report.

The Project Team would also like to thank George McKittrick, David Beede, Pragya Nandini,

Sandra Cooke-Hull, and Cassandra Ingram from ESA; Paul Harrison, Jim Hirabayashi, and

Camille Barr from USPTO; Chi Mac from the Office of Management and Budget; Mark Dumas,

Chris Kask, and Lisa Usher from the Bureau of Labor Statistics, Office of Productivity and

Technology; Anna Jacobson, Carol Robbins, and Mary Streitweiser from BEA; Jack Moody from

the Census Bureau; and Stephen Siwek from Economists Incorporated.

JOINT PROJECT TEAM

Mark Doms, Chief Economist Stuart Graham, Chief Economist 

Brittany Bond, Economist Galen Hancock, Economist

Jocelyn Burston, Program Analyst

David Langdon, Economist

Fenwick Yu, Economist

Intellectual Property and the U.S. Economy: 

Industries in Focus

EXECUTIVE SUMMARY

I

nnovation—the process through which new ideas are generated and successfully introduced

in the marketplace—is a primary driver of U.S. economic growth and national

competitiveness.1 Likewise, U.S. companies’ use of trademarks to distinguish their goods

and services from those of competitors represents an additional support for innovation, enabling

firms to capture market share, which contributes to growth in our economy. The granting and

protection of intellectual property rights is vital to promoting innovation and creativity and is

an essential element of our free-enterprise, market-based system. Patents, trademarks, and

copyrights are the principal means used to establish ownership of inventions and creative ideas

in their various forms, providing a legal foundation to generate tangible benefits from

innovation for companies, workers, and consumers. Without this framework, the creators of

intellectual property would tend to lose the economic fruits of their own work, thereby

undermining the incentives to undertake the investments necessary to develop the IP in the first

place.2 Moreover, without IP protection, the inventor who had invested time and money in

developing the new product or service (sunk costs) would always be at a disadvantage to the

new firm that could just copy and market the product without having to recoup any sunk costs

or pay the higher salaries required by those with the creative talents and skills. As a result, the

benefits associated with American ingenuity would tend to more easily flow outside of the

United States.

IP is used everywhere in the economy, and IP rights support innovation and creativity in

virtually every U.S. industry. While IP rights play a large role in generating economic

growth, little attention has been given to identifying which industries produce or use

significant amounts of IP and rely most intensively on these rights. This report begins

such an investigation by developing several industry-level metrics on IP use and employing

these measures to identify a set of the most IP-intensive industries in the U.S. economy. To

develop the industry-level metrics discussed, several databases were used, some of which (for the

patent and trademark analyses) are publicly available.3 In the future, more user-friendly sets of

these patent and trademark data will be made available on the U.S. Patent and Trademark

Office (USPTO) website.

Intellectual Property and the U.S. Economy: Industries in Focus

v

1 National Economic Council et al. 2011, 7.

2 Ibid., 11.

3 See www.uspto.gov/web/offices/ac/ido/oeip/taf/data/naics_conc/ and also www.google.com/googlebooks/uspto-trademarks.html.
This report employs USPTO administrative data to identify the industries that most intensively

use the protection offered by patents and trademarks. For copyrights, the report identifies the

set of industries primarily responsible for both the creation and production of copyrighted

materials. The report then uses standard statistical methods to identify which American

industries are the most patent-, trademark-, and copyright-intensive, and defines this subset of

industries as “IP-intensive.” Using data collected from sources across the U.S. government, the

report examines both the important trends and economic characteristics of these highly IPintensive industries and their meaningful contributions to the U.S. economy. There are several

important findings contained in the report. 

According to the analysis in this report, the direct and indirect employment in these industries

is substantial: Direct employment in the subset of most IP-intensive industries identified in this

report amounted to 27.1 million jobs in 2010, while indirect activities associated with these

industries provided an additional 12.9 million jobs throughout the economy in 2010, for a total

of 40.0 million jobs, or 27.7 percent of all jobs in the economy. 

Because all U.S. industries rely on IP to some degree, the statistics reported here for the sectors

that use IP most intensively may tend to under-represent the broad impact of IP in the

American economy. Moreover, the statistics reported here may not fully reflect the long-run

economic benefits and costs of IP in promoting innovation and productivity growth. For

example, while this report shows that employment in trademark-intensive industries is almost

six times as great as employment in patent-intensive industries, it may be that the kinds of

innovation protected by patents play a larger role in driving the long-run growth of productivity

throughout the economy. 

This report does not contain policy recommendations and is not intended to directly advance

particular policy issues. By developing new quantitative measures of IP-intensity by industry,

the report aims to promote a better understanding of the industries where IP plays a particularly

important role. Although policy issues are not discussed in this report, as a general matter, we

note the importance of achieving a balanced system of IP rights that protects inventors and

creators from unlawful use of their work while encouraging innovation, competition, and the

markets for technology in which IP is transacted. Importantly, using IP rights to support

innovation and creativity means recognizing the public domain and limits such as fair use which

balance the public’s right to use content legally with IP owners’ interests.

PRINCIPAL FINDINGS

■ The entire U.S. economy relies on some form of IP, because virtually every industry either

produces or uses it. 

■ By focusing on relevant data and various statistical measures, this report identified

75 industries (from among 313 total) as IP-intensive. These IP-intensive industries

directly accounted for 27.1 million American jobs, or 18.8 percent of all employment in

Intellectual Property and the U.S. Economy: Industries in Focus

vi
the economy, in 2010.4 A substantial share of IP-intensive employment in the United

States was in the 60 trademark-intensive industries, with 22.6 million jobs in 2010. The

26 patent-intensive industries accounted for 3.9 million jobs in 2010, while the

13 copyright-intensive industries provided 5.1 million jobs.5

■ IP-intensive industries accounted for about $5.06 trillion in value added, or 34.8 percent

of U.S. gross domestic product (GDP), in 2010.

■ While IP-intensive industries directly supported 27.1 million jobs either on their payrolls

or under employment contracts, these sectors also indirectly supported 12.9 million more

supply chain jobs throughout the economy. In other words, every two jobs in IP-intensive

industries support an additional one job elsewhere in the economy. In total, 40.0 million

jobs, or 27.7 percent of all jobs, were directly or indirectly attributable to the most IPintensive industries. 

■ Due primarily to historic losses in manufacturing jobs, overall employment in IP-intensive

industries has lagged other industries during the last two decades. While employment in

non-IP-intensive industries was 21.7 percent higher in 2011 than in 1990, overall IPintensive industry employment grew 2.3 percent over this same period. Because patentintensive industries are all in the manufacturing sector, they experienced relatively more

employment losses over this period, especially during the past decade. While trademarkintensive industry employment had edged down 2.3 percent by the end of this period,

copyright-intensive industries provided a sizeable employment boost, growing by

46.3 percent between 1990 and 2011.

■ Between 2010 and 2011, the economic recovery led to a 1.6 percent increase in

direct employment in IP-intensive industries, faster than the 1.0 percent growth in

non-IP-intensive industries. Growth in copyright-intensive industries (2.4 percent),

patent-intensive industries (2.3 percent), and trademark-intensive industries (1.1 percent)

all outpaced gains in non-IP-intensive industries.

■ Jobs in IP-intensive industries pay well compared to other jobs. Average weekly wages for

IP-intensive industries were $1,156 in 2010 or 42 percent higher than the $815 average

weekly wages in other (non-IP-intensive) private industries. This wage premium nearly

doubled from 22 percent in 1990 to 42 percent by 2010. Patent- and copyright-intensive

industries have seen particularly fast wage growth in recent years, with the wage premium

Intellectual Property and the U.S. Economy: Industries in Focus

vii

4 Using data provided by the Bureau of Labor Statistics’ Industry Productivity program, employment covers the sum of

payroll jobs, self-employed persons, and unpaid family workers, and totaled 144.2 million jobs in 2010. Because the

unit of measure is jobs (as opposed to persons) and because about 5 percent of all workers have more than one job, the

total number of jobs is greater than the 139.1 million employed persons in 2010, as estimated from the Current

Population Survey (www.bls.gov/cps).

5 Because several industries were found to intensively use both patents and trademarks or copyrights and trademarks,

total IP-intensive industry employment is less than the sum of patent-, trademark-, and copyright-intensive industry

employment.
in patent-intensive industries increasing from 66 percent in 2005 to 73 percent in 2010,

and the premium in copyright-intensive industries rising from 65 percent to 77 percent.

■ The comparatively high wages in IP-intensive industries correspond to, on average, the

completion of more years of schooling by these workers. More than 42 percent of workers

aged 25 and over in these industries in 2010 were college educated, compared with

34 percent on average in non-IP-intensive industries. 

■ Merchandise exports of IP-intensive industries totaled $775 billion in 2010, accounting

for 60.7 percent of total U.S. merchandise exports.

■ Data on foreign trade of IP-intensive service-providing industries is limited; however, this

report does find that exports of IP-intensive service-providing industries accounted for

approximately 19 percent of total U.S. private services exports in 2007.

Intellectual Property and the U.S. Economy: Industries in Focus

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Intellectual Property and the U.S. Economy: 

Industries in Focus

Table of Contents

FOREWORD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

ACKNOWLEDGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v

I. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

II. IDENTIFYING IP-INTENSIVE INDUSTRIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Patents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Fractional vs. Whole Patents Counts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

USPTO’s Patent Class - NAICS Concordance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Alternatives and Robustness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Trademarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Identifying Trademark-Intensive Industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Trademark Intensities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Top 50 Trademark-Registering Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Random Sample of Trademark Registrations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Identifying Trademark-Intensive Industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Brands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Trademark Registrations by Class . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

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Copyrights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Identifying Copyright-Intensive Industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

IP-Intensity and the Use of Intellectual Property Protection . . . . . . . . . . . . . . . . . . . . . . . 33

IP-Intensive Industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

III. IP-INTENSIVE INDUSTRIES IN THE ECONOMY . . . . . . . . . . . . . . . . . . . . . . . . 39

Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Total Employment Supported by IP-Intensive Industries . . . . . . . . . . . . . . . . . . . . . . . . . 43

Value Added . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

Payroll Employment by State in IP-Intensive Industries . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Average Weekly Wages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Educational Attainment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Foreign Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

APPENDIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

Revenue Generated from the Licensing of Rights to Use

Protected Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

REFERENCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61

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I. Introduction

“The key to our success – as it has always been – will be to compete by

developing new products, by generating new industries, by maintaining our role

as the world’s engine of scientific discovery and technological innovation.

It’s absolutely essential to our future.” 

– President Barack Obama, November 17, 2010

Adefining characteristic of the U.S. economy throughout its history is its rapid and

sustained growth. For example, real income per person two hundred years ago was four

percent of what it is today.6 Strong and sustained economic growth results from several

factors, but among the most important is innovation, “the process by which individuals and

organizations generate new ideas and put them into practice” and create “new and better ways

of producing goods and services.”7 Likewise, U.S. companies’ use of trademarks to distinguish

their goods and services from those of competitors represents an additional support for

innovation, enabling firms to capture market share and promoting growth in our economy. 

One important way to help encourage innovation is through the protection of intellectual

property (IP). The investments necessary to develop IP are often quite substantial. Firms and

individuals, in order to invest the necessary resources, need some assurance that they will benefit

from and recover the costs of the creation of intellectual property. IP rights help protect

authors, inventors, and merchants of goods and services from having their creations and

innovations quickly and easily exploited by other firms or individuals, diminishing the benefits

to the inventor of the IP. This reduction in private benefits to be gained from the underlying

innovation could, in turn, reduce the incentives to undertake the investments necessary to

develop the IP in the first place.8

Protection of IP has been a critical function of the U.S. government since the founding of this

country. Indeed, Article I, Section 8, Clause 8 of the U.S. Constitution grants to Congress the

power to “promote the Progress of Science and useful Arts by securing for limited Times to

Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” 

Patents, trademarks, and copyrights are the principal means for establishing ownership rights to

inventions and ideas, and they provide a legal foundation by which intangible ideas generate

tangible benefits to firms and workers. IP protection affects commerce throughout the

economy by:

Intellectual Property and the U.S. Economy: Industries in Focus

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6 Maddison 2006.

7 National Economic Council et al. 2011, 7.

8 Ibid., 11.
■ Providing incentives to invent and create; 

■ Protecting innovators from unauthorized copying;

■ Facilitating vertical specialization in technology markets;

■ Creating a platform for financial investments in innovation;

■ Supporting entrepreneurial liquidity through mergers, acquisitions, and IPOs; 

■ Making licensing-based technology business models possible; and 

■ Enabling a more efficient market for technology transfer and trading in technology

and ideas. 

Certain industries find IP protection to be especially important and consequently register a

relatively high number of patents, trademarks, and copyrights compared with other similarly

sized industries. Still, as a general matter, we note the importance of achieving a balanced

system of IP rights that protects inventors and creators from unlawful use of their work while

encouraging innovation, competition, and the markets for technology in which IP is transacted.

Importantly, using IP to support innovation and creativity means recognizing the public

domain and limits such as fair use which balance the public’s right to use content legally with

IP owners’ interests. 

This report, prepared by the Economics and Statistics Administration (ESA) and the U.S.

Patent and Trademark Office (USPTO) of the U.S. Department of Commerce, focuses on

identifying these IP-intensive industries and examining their characteristics and contributions to

the overall economy. Using administrative data and economic literature analyzing IP

protection, this report develops various metrics of IP usage by industry. The report does not

contain policy recommendations and is not intended to directly advance particular policy issues.

By developing new measures of IP-intensity by industry, the report provides a better

understanding of the industries where IP plays a particularly important role. 

To be specific, the report identifies 75 industries (from among 313 total) that are particularly

dependent on patent, copyright, or trademark protection and which we define as IP-intensive.

The second section of this report, “Identifying IP-Intensive Industries,” lays out the

methodologies used to develop these metrics and details which industries were selected as

IP-intensive. Given the differing natures of patents, copyrights and trademarks along with data

limitations, we developed separate approaches that are consistent, to the extent possible, for

identifying which industries rely on patents, trademarks, or copyrights. 

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In the third section of this report, we present evidence on the size of these industries relative

to the economy as a whole. This analysis points to several key results. First, these industries

accounted for 27.1 million, or 18.8 percent, of all jobs in 2010.9 They contributed

34.8 percent to gross domestic product (GDP), with total value added of $5.06 trillion in

2010. The bulk of employment and value added correspond to the 60 trademark-intensive

industries, which is a reflection of the nearly ubiquitous use of trademarks and logos in the

marketplace. The share of total employment in many IP-intensive industries has edged down

over the past two decades. Further, it is important to note that these 75 industries are by no

means the only ones with business models and profits supported by IP protection. Indeed, as

discussed more below, this report reinforces the notion that all sectors of the economy actively

use IP protection.

In addition, we examine how these industries have performed relative to other, less IP-intensive

industries. In particular, although IP-intensive industries have not performed as well in job

growth relative to other sectors over the last two decades, IP-intensive industries have been a

source of high-quality jobs, with average weekly wages in these industries averaging 42 percent

higher than the average for all other industries. The workers in IP-intensive industries also tend

to be better educated, on average, than other workers: more than 42 percent of workers age

25 and over in these IP-intensive industries were college educated, compared to one in three in

other industries. Copyright-intensive industries, in particular, employed the most educated

workers, with 61 percent holding at least a college degree. Finally, IP-intensive industries awere

large contributors to U.S. foreign trade, accounting for about 60.7 percent of total merchandise

exports and about 19 percent of service exports.

Intellectual Property and the U.S. Economy: Industries in Focus

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9 This analysis uses employment data from the Bureau of Labor Statistics’ Industry Productivity program, which

includes the sum of payroll jobs, self-employed persons, and unpaid family workers and totaled 144.2 million jobs in

2010. Because the unit of measure is jobs (as opposed to persons) and because about 5 percent of all workers have

more than one job, the total number of jobs is greater than the 139.1 million employed persons in 2010, as estimated

from the Current Population Survey (www.bls.gov/cps).

II. Identifying IP-Intensive Industries

PATENTS

Overview

Utility patents, hereafter referred to as “patents” unless otherwise noted, assist owners in

protecting the rights to inventions and innovative processes.10 A patent issued by the

USPTO enables the owner to pursue legal action to exclude “others from making, using,

offering for sale, or selling the invention throughout the United States or importing the

invention into the United States.”11 U.S. patents are issued to inventors who can assign their

ownership rights to individuals, corporations, universities, other organizations, or branches of

governments of any nationality.12, 13 Our patent analysis focuses only on patents issued to U.S

corporations, which accounted for about 45 percent of total patents issued between fiscal years

(FY) 2004 and 2008 and 87 percent of all U.S.-owned patents for this time period.14, 15 

Patents are further classified in over 430 patent “technology classes” that distinguish their

inventive content.16 Additionally, the USPTO maintains a general concordance between its

technology classifications and 32 North America Industry Classification System (NAICS) codes

(26 unique codes and 6 combinations), which enables analysts to associate patents with these

industries.17 We rely on these NAICS-based patent counts for FY 2004 to FY 2008 to identify

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10 In addition to utility patents, there are two other types of patents: design and plant. Utility patents apply to

processes, machines, articles of manufacture, composition of matter, or any new and useful improvements thereof.

Design patents apply to ornamental designs for an article of manufacture. Plant patents apply to the invention or

discovery of selected new varieties of asexually reproducing plants. 

11 35 U.S.C. ß 157(a)(1). This right was established over 200 years ago in fulfillment of Article 1, Section 8 of the

United States Constitution: “The Congress shall have Power... To promote the Progress of Science and useful Arts, by

securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;”

www.uspto.gov/patents/index.jsp.

12 Inventors, who are always individuals and not organizations, apply for patents. The inventors can transfer (assign)

their rights to anyone, including organizations, and can do so before or after the patent is issued. Commonly, inventors

work for employers who hire them to create new inventions, and as part of their employment agreements agree in

advance to assign to their employers any patent rights that result from their work.

13 Today, multiple inventors on a single patent often come from several nations, an example of globalization’s impact on

innovation. 

14 The “U.S. corporation” category of ownership in USPTO reports broadly includes private organizations, including

small and large companies, nonprofits, partnerships, and universities.

15 See Tables A1-1a, A1-1b at www.uspto.gov/web/offices/ac/ido/oeip/taf/h_at.htm#PartA1_1b.

16 Utility patents may be classified into more than one technology class, but are organized according to their primary

classification.

17 This concordance was created by the USPTO with financial support from the National Science Foundation. For an

overview of NAICS, see www.census.gov/eos/www/naics/index.html.
patent-intensive industries.18 Just as a patent can be assigned to more than one technology class,

it also may be associated with multiple industries. Because no similar concordances to NAICS

are available for plant or design patents, only utility patents were used in our analysis.19 This

approach strictly limits the patent analysis to the manufacturing sector because the concordance

system only associates patents with manufacturing industries. Service-providing industries may

also rely on utility patents in their production processes, but these industries are not captured

by the patent-NAICS concordance that we employ.

Fractional vs. Whole Patents Counts 

The USPTO reports patent data by NAICS category using two different counting measures.

The first gives one full count to every industry associated with a particular patent. The second

divides each patent by the number of industries it is associated with, thus creating fractional

counts of patents. The sum of the fractional counts equals the total number of patents issued in

a given year, while the sum of the whole counts across industries is greater than the number of

patents issued. Patent analyses within a given industry or technology class commonly use whole

counts; however, cross-industry analyses typically use fractional counts in order to avoid overcounting. For these same reasons, fractional counts are used in this report.20, 21 It is important to

note that the NAICS concordance maintained by the USPTO associates each patent with its

final use in the economy. In practice, this means that the patents are all associated with

manufacturing NAICS codes regardless of whether the company that owns them is a

manufacturer or a company that may be classified in the services sector.22

Methodology

The USPTO has NAICS-based patent data covering the period from 1963 to 2008. We

calculated a measure of industry patent “intensity,” defined as the ratio of total patents over the

five years in a NAICS category to the average payroll employment by industry. Because

employment is a gauge of industry size, dividing patent counts by employment normalizes

patenting activity with respect to industry size.23 This approach helps put all industries on an

even playing field, so that the most patent-intensive industries were defined not as the ones with

the most patents, but rather those with the most patents per job.

Intellectual Property and the U.S. Economy: Industries in Focus

6

18 See www.uspto.gov/web/offices/ac/ido/oeip/taf/data/misc/patenting_trends/info_ptrends2008.txt.

19 To contrast the scale of technology patents, design patents break out into 33 classes and plant patents into only one

patent class. See www.uspto.gov/web/offices/ac/ido/oeip/taf/all_tech.htm for more information on utility patents.

20 It should be noted that the use of fractional patent counts differs somewhat from our treatment of trademark

registrations for which whole counts of registrations by class were used.

21 As a robustness check, we repeated our analysis using full counts and found little difference in our final results. 

22 For full details on the nature and caveats of the patent data used, see

www.uspto.gov/web/offices/ac/ido/oeip/taf/govt/naics/explan_naics.htm. 

23 Value added and gross output are two alternative gauges of industry size; however, estimates at the level of detail

needed for this analysis are not publicly available due to data confidentiality limitations. 
By using a five-year period (in this case, FY 2004-08, the most recent period for which data are

available) instead of just one year helps minimize the chance that anomalies in any given year will

skew our results. The analysis was performed at the greatest possible level of NAICS industry

detail, and so results include four-digit industries as well as some individual three-digit industries

and combinations of three- or four-digit industries.24 As will be seen in the results, most patentintensive industries in the sample fall into the four-digit NAICS industries, which may be a

product of the patent-intensive nature of these more finely disaggregated industry sectors. 

Results

We defined patent-intensive industries as ones with above-average patent intensity (patent/job

ratio) when comparing all industries.25 (See Table 1.) The four most patent-intensive industries

all have intensity rates that are one standard deviation above the mean patent-intensity cutoff,

and are all classified in computer and electronic product manufacturing (NAICS 334). This

three-digit NAICS industry includes computer and peripheral equipment; communications

equipment; other computer and electronic products; semiconductor and other electronic

components; and navigational, measuring, electro-medical, and control instruments. This is

unsurprising when one also looks at the recent top ten U.S. companies ranked by granted

patents.26, 27 This group of companies includes Intel, Hewlett-Packard, Micron Technology, and

Texas Instruments, each of which is closely associated with computer and computer peripheral

manufacturing. 

USPTO’s Patent Class - NAICS Concordance

The scheme used by the USPTO to associate utility patents with their proper NAICS

designation includes groups of four-digit as well as three-digit NAICS codes. With respect to

machinery manufacturing (NAICS 333) and electrical equipment, appliance, and component

manufacturing (NAICS 335), the USPTO does not provide a breakdown beyond this threedigit level, largely because many of the classes in these categories overlap with other NAICS

codes. Thus, our analysis of patents cannot measure patent intensity in NAICS 333 and 335 at

a more disaggregated level because technology classes corresponding to these industry categories

cannot easily and cleanly be associated with more detailed NAICS industries. Because we

cannot disaggregate these two industries, or the groupings of NAICS 3343 and 3346, and

NAICS 3253, 3255, and 3256 (which also were found to be patent-intensive) into their fourdigit NAICS components, it is not possible to know whether each of the individual four-digit

industries is patent-intensive according to our definition.

Intellectual Property and the U.S. Economy: Industries in Focus

7

24 In the NAICS classification, a three-digit code is a larger aggregation as compared to a four-digit code. So, for

instance, NAICS 236 “construction of buildings” is a larger aggregation of which NAICS 2361 “residential building

construction” is a smaller and more specific subset.

25 Although we pooled the FY 2004-08 patent counts, we also examined individual years to see how stable the selection

of patent-intensive industries would be over time. The list of most intensive industries proves to be relatively stable over

time, especially the high rankings of the computer and peripheral equipment manufacturers.

26 See www.uspto.gov/web/offices/ac/ido/oeip/taf/asgstc/usa_ror.htm.

27 The OneSource Business Browser was used to classify companies to NAICS industries;

www.onesource.com/businessbrowser.aspx.
Table 1. Patent Intensity, FY 2004-08

Patent

Patents Employment intensity NAICS code Industry title (number) (1000 jobs) (patents/

1000 jobs)

Computer and peripheral 3341 equipment 54,416 196.1 277.5

3342 Communications equipment 35,797 135.2 264.8

Semiconductor and other 3344 electronic components 50,088 448.7 111.6

Other computer and electronic 3343,-6 products 7,744 71.4 108.5

Navigational, measuring, 

3345 electromedical, and control 42,415 441.3 96.1

instruments

3251 Basic chemicals 12,109 150.9 80.2

Electrical equipment, appliance, 335 and components 23,503 433.0 54.3

3254 Pharmaceutical and medicines 13,627 291.3 46.8

3399 Other miscellaneous 12,717 339.2 37.5

Other chemical products and 3253,-5,-6,-9 preparation 10,322 318.1 32.4

3391 Medical equipment and supplies 9,716 303.2 32.0

333 Machinery 37,105 1,173.7 31.6

Resin, synthetic rubber, fibers, 3252 and filaments 2,771 106.4 26.0

326 Plastics and rubber products 8,289 775.8 10.7

3361-3363 Motor vehicles, trailers and parts 8,298 1,029.8 8.1

327 Nonmetallic mineral products 3,651 497.2 7.3

3365,-6,-9 Other transportation equipment 1,585 222.4 7.1

3364 Aerospace products and parts 2,726 473.3 5.8

313,-4,-5,-6 Textiles, apparel and leather 2,566 632.2 4.1

332 Fabricated metal products 5,495 1,532.5 3.6

331 Primary metals 998 458.9 2.2

337 Furniture and related products 1,107 543.0 2.0

Paper, printing and support 322,-3 activities 1,313 1102.6 1.2

312 Beverage and tobacco products 217 195.5 1.1

321 Wood products 428 527.8 0.8

311 Food 719 1,483.1 0.5

Total 354,360 13,882.7 25.5

Source: ESA calculations using data from USPTO and the Bureau of Labor Statistics’ Current Employment Statistics program.

Note: The patent count is the total for fiscal years 2004-08, while employment shows the calendar year 2004-08 average in

thousands of jobs. 

Intellectual Property and the U.S. Economy: Industries in Focus

8Above mean
Alternatives and Robustness

The methodology used in this report identifies industries only, and so should not be used to

draw conclusions about specific companies in these industries, or in other industries which did

not make our list. For example, industries with a relatively small stock of highly valuable patents,

but relatively large numbers of employees, would not be selected as patent-intensive in our

methodology, even though companies in that industry may rely critically upon patent protection. 

The aerospace industry is a good illustration of this point. Its patent-to-jobs ratio was about

one-fifth the overall average, but there is other evidence suggesting that patenting is considered

important by aerospace companies. In a survey conducted by researchers at Carnegie-Mellon

University in 1994, aerospace company R&D managers reported on average that 78 percent of

their business units filed for patents (about the same share reported by the pharmaceutical and

basic chemical industries, both of which make our list of patent-intensive industries) and that

51 percent of product innovations were being patented (about the same share as in the

semiconductor industry, which was also included in our list).28 So, while it does appear that

patenting was relatively important to companies in the aerospace industry during the early 1990s,

this sector does not show up in our current list. This outcome could indicate that patent

protection is less useful in aerospace than two decades ago (probably unlikely), or it may be an

artifact of the manner in which technologies are assigned to industries in our methodology.

Another possibility is that industries may rely on proprietary protections other than patents,

such as a trade secret, which may very well be a safer mode of protecting new discoveries in an

industry with few competitors monitoring each other closely. Whereas patenting requires

disclosure of the details of the new discovery, a trade secret allows the discovery to remain

undisclosed, under close in-house protection.

The Carnegie-Mellon University survey allows the consideration of an alternative measure of IP

reliance, based not on the number of patents granted per employee, but instead on the responses

of research and development (R&D) lab managers to questions concerning the effectiveness of

different methods for protecting innovation. Because managers were asked in the survey to

report on the percentage of product and process innovations for which patent protection was

effective at capturing competitive advantage from the innovation, the study provides a window

into the relative importance of patent protection considered against the stock of innovations that

industries are producing. As Table 2 makes clear, this survey method results in a different

ranking among industries than the patent intensity measures used in this report, with sectors

such as pharmaceuticals (drugs), medical equipment, and chemicals ranked most highly. 

Because this survey was conducted in the mid 1990s, it was not considered an ideal principal

measure for current industry activities. It is noteworthy, however, that the industries reporting

that patents were effective for more than 51.0 percent of product innovations and 23.3 percent

of process innovations (the overall averages in the survey) are largely the same industries with

above-average patent-to-jobs ratios (patent intensity) in the mid-to-late 2000s. For this reason,

the Carnegie-Mellon University survey results serve as an important robustness check for the

accuracy of the methodology selected in this report for patent-intensive industries.

Intellectual Property and the U.S. Economy: Industries in Focus

9

28 See Cohen et al. 2000.
Table 2. Percent of Product and Process Innovations for which Patents

were Considered an Effective Mechanism for Appropriating the Returns

to Innovation, by Industry. 

Product Process SIC Industry title innovations SIC Industry title innovations code (percent) code (percent)

3311 Medical equipment 54.70% 2320 Petroleum 36.67%

2423 Drugs 50.20% 2423 Drugs 36.15%

Special purpose machinery, 3311 Medical equipment 34.02%

2920 nec. 48.83% 2700 Metal, nec. 31.67%

3430 Auto parts 44.35% 2610 Glass 30.83%

3010 Computers 41.00% 3010 Computers 30.25%

2429 Miscellaneous chemicals 39.66% 2411 Basic chemicals 29.71%

2800 Metal products 39.43% Special purpose machinery, 

3410 Car/truck 38.89% 2920 nec. 28.57%

2411 Basic chemicals 38.86% 2100 Paper 27.58%

General purpose machinery, 2429 Miscellaneous chemicals 27.32%

2910 nec. 38.78% 1700 Textiles 25.22%

3230 TV/radio 38.75% 3430 Auto parts 24.35%

2400 Chemicals, nec. 37.46% General purpose machinery, 

2100 Paper 36.94% 2910 nec. 23.62%

2922 Machine tools 36.00% 3600 Other manufacturing 23.42%

3100 Electrical equipment 34.55% 2600 Mineral products 23.33%

3600 Other manufacturing 33.81% Semiconductors and related 

2320 Petroleum 33.33% 3210 equipment 23.33%

2413 Plastic resins 32.96% 2800 Metal products 22.50%

3530 Aerospace 32.92% 3110 Motor/generator 22.14%

2500 Rubber/plastic 32.71% 3410 Car/truck 21.67%

2610 Glass 30.83% 3530 Aerospace 21.38%

2695 Concrete, cement, lime 30.00% 2413 Plastic resins 21.30%

Search/navigational 2400 Chemicals, nec. 20.40% 3314 equipment 28.68% 2500 Rubber/plastic 19.86%

3210 Electronic components 26.67% 3100 Electrical equipment 19.09%

3312 Precision instruments 25.86% 3230 TV/radio 18.75%

3220 Communications equipment 25.74% 2695 Concrete, cement, lime 18.50%

3110 Motor/generator 25.23% 2922 Machine tools 18.00%

2710 Steel 22.00% 3312 Precision instruments 16.77%

Semiconductors and 1500 Food 16.40% 3210 related equipment 21.35% 2710 Steel 15.50%

2600 Mineral products 21.11% 3210 Electronic components 15.19%

1700 Textiles 20.00% 3220 Communications equipment 14.70%

2700 Metal, nec. 20.00% Search/navigational

1500 Food 18.26% 3314 equipment 13.24%

2200 Printing/publishing 12.08% 2200 Printing/publishing 8.64%

All industries 34.83% All industries 23.30%

Source: Cohen et al. 2000, Tables 1 and 2. 

Note: Estimates are the mean percentage of product or process innovations for which patents were considered by

respondent to be effective for securing competitive advantage. Bolded industries in each list are those with response

scores above the industry-level mean for all industries surveyed in the study. Industries are defined according to the

1987 Standard Industrial Classification (SIC) system, the precursor to NAICS. The abbreviation “nec.” stands for

“not elsewhere classified.”

Intellectual Property and the U.S. Economy: Industries in Focus

10
Trademarks

Overview 

Industries throughout the economy rely on trademarks registered at the USPTO to protect

brands for the goods and services they market.29 A trademark is “a word, phrase, symbol, or

design, or a combination thereof, that identifies and distinguishes the source of the goods of

one party from those of others.”30 Unlike a patent, which protects an invention, or a copyright,

which protects a work of original authorship, a trademark does not protect a new product or

service per se. A trademark instead confers protection upon the brand or identity of a good,

thus preventing competitors from leveraging another firm’s reputation and confusing consumers

as to the source of the goods. Service marks are similar in nature to trademarks, but distinguish

the source of a service rather than a good.31 In the remainder of this text, the term “trademark”

will refer to both trademarks and service marks. 

Any company or individual, American or foreign, can apply to register a trademark with the

USPTO for a nominal fee. Once granted, trademark registrations can remain in force

indefinitely as long as the trademark remains in active use and maintenance payments are made.

If the trademark is not in active use and maintained, the rights will cease after a period of time,

normally five years. To maintain trademark registrations, new owners must file a Section 8

Affidavit of Continuous Use before the end of the sixth year after the initial registration date.

Trademark registrations must be renewed on or about every 10-year anniversary of the

registration of the trademark.32

Identifying Trademark-Intensive Industries

Unlike patents, there is little academic research examining industry use of trademarks.

Accordingly, this report offers what may be the first comprehensive analysis of trademark use by

U.S. industries that is grounded in original research, data, and measurement theory. As a

preliminary matter, we recognized that each trademark registration has a description of the type

of good or service with which the protected mark is used in commerce. The USPTO classifies

goods and services for administrative convenience, and applicants for trademark registration

must provide a separate description—and pay separate application and maintenance fees—for

Intellectual Property and the U.S. Economy: Industries in Focus

11

29 We note that trademark owners are not required to register their trademarks. Parties can acquire rights in their

trademarks merely by using those trademarks. In addition, trademark owners who wish to register their trademark may

do so not only at the USPTO, but with state authorities as well, or with both. The trademarks that were analyzed in

connection with the present study were all registered at the USPTO.

30 USPTO 2010a.

31 For example, the Whole Foods Market grocery store brand name is a service mark for retail grocery store services, and

also a trademark for hair shampoo and soap. 

32 There is no further 6-year affidavit requirement after the first 10-year term. Overall, 46 percent of the nearly 822,000

registrations from the 1990s “survived” into the 2000s. 
Intellectual Property and the U.S. Economy: Industries in Focus

12

33 For a list of classes, see Trademark Manual of Examining Procedure (TMEP) chapter 1400 (7th ed. 2010). Fees also

are a function of the type of application form used. For more information on the trademarking process, see USPTO

2010a.

34 An example is the mark “Nike” being registered in classes associated with (a) software, (b) golf equipment, and

(c) eyewear. See U.S. trademark registration numbers 3406594, 3389746, and 3081688, each by Nike, Inc. 

35 Another way to think about this is to consider the registration counts to be weighted by the number of classes. So, if

the mark for brand A is registered in a single class and the mark for brand B is registered in five classes, then, we

calculate total registrations = (classes per markbrand i * markbrand i) = (1*1) + (5*1) = 6.

36 This trademark is serial number 76977931 and can be found by using the USPTO searchable trademark database at

tarr.uspto.gov/servlet/tarr?regser=serial&entry=76977931. 

37 For example, the list of industries selected because of their trademark intensity, as described in the next section,

includes 55 industries. Had we calculated the intensities based on fractional trademark counts, the list would have

numbered 51 industries, with 49 industries appearing on both lists.

each “class” in which the goods or services associated with the trademark is classified.33 This

makes working with trademark registration data different from working with patent grant data. 

Trademark application and maintenance fees are assessed on a per-class basis, and registration

holders may elect to renew their registrations with respect to some but not all classes. As a

result, holding a “multi-class” registration is practically equivalent to holding multiple

registrations, one for each class. Accordingly, in the foregoing analysis each class listed on a

registration was considered as the unit of analysis, creating a class-registration count. For

example, if one mark (or logo) is registered in three classes, then our input measure in the

analysis reflects three trademark registration counts, one for each class.34

In practice, the vast majority of trademark registrations are associated with a single class.

However, from 2000 to 2009, about 16 percent of trademarks were registered in more than one

class. About 10 percent were registered in two classes, while the remaining six percent were

registered in anywhere from three to 45 classes. As a result of this variation, the sum of

registration-class observations is somewhat greater than the sum of registrations.35

As an example of a firm that has chosen to register a trademark in multiple classes, consider

Whole Foods’ “365 Everyday Value” brand. Whole Foods protects the 365 Everyday Value

brand in 10 different trademark classes.36 The goods classes under which the 365 Everyday

Value logo is applied include processed foods (from frozen dinners to trail mix), staple foods

(cereal, tortilla chips, pasta sauce, cookies), as well as food storage containers, paper products

(paper towels and coffee filters), and cosmetics and cleaning preparations (laundry detergent,

shampoo, bath gels). In effect, these 10 classes are 10 distinct registrations, each of which can

be renewed, or not, separately. 

The approach that we adopted for measuring trademark-intensive industries parallels, but differs

from, the approach employed when analyzing patents.37 For patents, each patent was counted

only once overall; for trademark measurements, each mark is counted once for each class in

which it belongs, potentially counting it more than once overall according to the number of

classes in which it is registered. Since it is not easy to ascertain which trademark classregistrations are relatively more important, we used the best measure available, based on the
Intellectual Property and the U.S. Economy: Industries in Focus

13

economic realities of the fee system.38 Because each trademark class registration involves some

fixed filing fee paid to the USPTO, the more classes in which a trademark is registered indicate

more times that a fee has been paid to the USPTO. Using these fee-payments is an effective

method to base an IP-intensity measure and this approach was followed consistently for both

trademarks and patents. Also, as a sensitivity measure, we found that counting patents and

trademarks differently, by using whole counts for patents for example, produced similar results.

Because trademark registrations can be segmented by class but not by industry, there is no

USPTO NAICS concordance for these data. Due to this methodological limitation, there is no

single, straightforward way to tabulate registrations and measure trademark intensities by

industry. Accordingly, and because the measurement of trademark use is a new science, we

opted for over-inclusiveness and developed a three-pronged approach to identifying trademarkintensive industries.

We relied on three related but distinct approaches, using different samples of companies that

have registered USPTO trademarks. The first approach is the closest approximation to the

methodology used to identify patent-intensive industries. Starting with the complete set of

trademark registrations, we matched publicly traded companies by their name to a separate

database containing information on the firms’ primary industry and number of employees.

These data allowed us to calculate trademark intensities by industry for the matched firms. In

the second approach, we reviewed lists of the top 50 corporate trademark registrants published

by the USPTO (which, unlike the first approach, include both private and public companies)

and identified industries that appear repeatedly. To help moderate the tendency of the first two

approaches to under-represent smaller and younger firms, our third approach focused on a

representative and random sample of firms drawn from the complete database of U.S. corporate

trademark registrations from FY 2004 to FY 2008.

Trademark Intensities

Methodology

Parallel to our method for defining patent intensities, we defined trademark intensities as the

ratio of trademark registrations to employment in a given industry. Thus, we measured the

number of trademark registrations per employee. The USPTO applied a firm-name

standardization routine developed originally for patent analysis in order to match companies

with new trademark registrations to companies in Compustat’s database of financial statements

of publicly traded companies.39 This matching identified 386,998 distinct standardized firm

names in the FY 2004-08 trademark registration and trademark renewal records. These were

firms that either registered or renewed at least one trademark from FY 2004 to FY 2008. These

records were matched with 9,539 parent-company records drawn from the Compustat database.

38 We could weight companies by number of employees, but it is more difficult to decide whether a given trademark

taken by itself should be weighted heavily or lightly.

39 This methodology has previously been applied in studies of patents, particularly as detailed in Hall, Jaffe, and

Trajtenberg 2001. This paper and other supporting documentation are available at www.nber.org/patents/.
Intellectual Property and the U.S. Economy: Industries in Focus

14

Successful matches were made for 3,475 firms. Since Compustat records also include NAICS

codes, it was straightforward to sum trademark registrations and employment by four-digit

NAICS industry and then estimate industry trademark intensity as the number of matched firm

trademarks per worker in each industry.40

Because Compustat does not record the relationships between parent and subsidiary companies,

the identities of trademark registrants were only matched to the name of the publicly traded

parent company reporting financial statements to the U.S. government. Accordingly,

trademarks registered in the name of subsidiaries that have different names than the parent

company were not matched by this method.41

Results

Overall, this procedure identified 235 four-digit NAICS industries with trademark registrations

among publicly traded parent companies. The employment-weighted mean trademark intensity

for these firms was 1.86 trademarks per 1,000 workers, and the weighted standard deviation was

3.80. Upon examining this distribution, we defined as trademark-intensive the 55 industries

with trademark intensities above the sample industry mean, consistent with our approach for

identifying patent-intensive industries. We also set as a minimum a sample size in each fourdigit NAICS industry of five distinct firms and 100 registrations over the 5-year period. These

minima helped us avoid wrongly selecting as trademark-intensive any industries that had high

estimated trademark intensities but very few firms in the matched sample or very low absolute

trademark registration activity.

As shown in Table 3, the 55 industries span most major industry sectors, with many industries

in the manufacturing and information sectors, as well as others from the financial activities,

professional and technical services, mining, construction, healthcare, and leisure and hospitality

sectors. Four industries stood out from the rest due to their notably high trademark intensities:

audio and video equipment manufacturing (82.5 trademarks per 1,000 employees), other

miscellaneous manufacturing (64.5), satellite telecommunications (35.3), and lessors of

nonfinancial intangible assets (33.3). The first two industries also ranked above the mean in

our patent-intensive listing. The category “lessors of nonfinancial intangible assets” is a special

case. That industry’s sole function is to assign “rights to assets, such as patents, trademarks,

brand names, and/or franchise agreements [but not to copyrighted works] for which a royalty

payment or licensing fee is paid to the asset holder.”42 Thus, the industry is by definition IP40 To the extent that matched firms differ in their trademarking behavior relative to unmatched firms, these trademark

intensities are biased. However, what really matters for our analysis is not whether the estimates are individually biased

but rather if any bias varies across industries. 

41 For this reason, this method not only tends to overweight large, publicly traded companies, but also those companies

that have a particular trademark-registration approach. Although no studies to our knowledge have been done on the

practices of corporate trademark registration at the parent or subsidiary level, recent patent scholarship suggests that IP

ownership may show systematic differences along these dimensions. See Arora, Belenzon, and Rios 2011, 29-30. 

42 See www.census.gov/cgi-bin/sssd/naics/naicsrch?code=533110&search=2007, noting that six-digit NAICS industry

533110 and four-digit NAICS industry 5331 are identical. The entire 2007 NAICS manual can be found online at

www.census.gov/eos/www/naics/index.html.
intensive, but could not be selected as patent-intensive because all patents were assigned by the

USPTO NAICS concordance only to manufacturing industries.

Table 3. Industries with Above-Average Trademark Intensity,

FY 2004-08

Trademark Trademark

NAICS intensity NAICS intensity

code Industry title (trademarks/ code Industry title (trademarks/

1000 workers) 1000 workers)

3343 Audio & video equipment mfg. 82.5 3231 Printing & related support 3.6 Other miscellaneous activities 3399 manufacturing 64.5

5416 Management & technical 

5174 Satellite telecommunications 35.3 consulting 3.5

Lessors of nonfinancial 3345 Electronic instrument mfg. 3.4 5331 intangible assets 33.3 5241 Insurance carriers 3.4

5191 Other information services 14.8 4234 Commercial equip. merchant 

5615 Travel arrangement & reservation 13.5 wholesalers 3.1

5179 Other telecommunications 12.4 3115 Dairy product manufacturing 3.0

5311 Lessors of real estate 11.2 3222 Converted paper product mfg. 2.9

5112 Software publishers 8.2 3251 Basic chemical manufacturing 2.9 

Electronic shopping & mail-order 4511 Sporting goods, hobby, and 4541 houses 7.7 musical instrument stores 2.9

Soap, cleaning compound, 3121 Beverage manufacturing 2.8 3256 & toiletries 7.4 5614 Business support services 2.7

Cutlery & handtool 3221 Pulp, paper, & paperboard mills 2.6 3322 manufacturing 7.3 3252 Resin, rubber, & artificial fibers 2.6

Other general purpose 3261 Plastics product manufacturing 2.6 3339 machinery manufacturing 6.1

3259 Other chemical product & 

Medical equipment & preparations 2.5

3391 supplies manufacturing 5.9

4242 Druggists’ goods merchant

Newspaper, book, & wholesalers 2.5

5111 directory publishers 5.8 3353 Electrical equipment mfg. 2.4

Commercial & service 6214 Outpatient care centers 2.4 3333 industry manufacturing 5.4

5239 Other financial investment 

5417 Scientific research & development 5.4 activities 2.3

Other electrical equipment 7132 Gambling industries 2.3 3359 & components 4.7 3112 Grain & oilseed milling 2.2

3254 Pharmaceutical & medicine mfg. 4.6 3336 Turbine & power transmission

3162 Footwear manufacturing 4.4 equipment 2.2

5121 Motion picture & video industries 4.3 5152 Cable & other subscription 

Household & institutional programming 2.2

3371 furniture 4.2 3119 Other food manufacturing 2.0

Grocery & related product 3329 Other fabricated metal 4244 wholesalers 4.1 product manufacturing 1.9

2361 Residential building construction 4.0 3341 Computer & peripheral 

3352 Household appliance manufacturing 3.8 equipment 1.9

2111 Oil & gas extraction 3.7 5221 Depository credit intermediation 1.9

3332 Industrial machinery manufacturing 3.7

3342 Communications equipment mfg. 3.7

Source: USPTO calculations using the agency’s trademark registration data and company employment data

from Compustat.

Intellectual Property and the U.S. Economy: Industries in Focus

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Intellectual Property and the U.S. Economy: Industries in Focus

16

Top 50 Trademark-Registering Companies 

Methodology 

Since 2006, the USPTO’s annual Fiscal Year Performance and Accountability Reports have

identified the 50 companies that obtained the largest number of trademark registrations during

the Federal fiscal year.43 Because these reports do not provide the primary NAICS code of the

companies in question, we used OneSource, a subscription-based dataset, to determine the

relevant NAICS industry classification for each of the companies listed for FY 2006-10.44, 45

On the theory that these large companies operate in industries with large numbers of trademark

registrations relative to the size of the industry, a subset of those industries was defined as

trademark-intensive.

After assigning each company to a four-digit NAICS industry, we tabulated the number of

times each industry appeared in the top 50 during the FY 2006-10 period. We designated

industries as trademark-intensive if they had counts of five or higher. At the extremes, counts of

five or higher occurred if a given company was among the top 50 registrants in each of the five

years studied, or if five different companies in an industry had reached the top 50 in a single

year during the period. The tabulations showed neither of those extremes. Two industries were

selected based on their score of five—sugar and confectionary products (NAICS 3113) and

household appliances (3352)—and in both cases, two or more companies accounted for the top

50 trademark registrations.

Results

There are 14 industries with counts of five or greater, with other miscellaneous manufacturing

at the top with 32.46 (See Table 4.) Also scoring in the double-digits are pharmaceutical and

medicine manufacturing; soap, cleaning compound, and toiletry product manufacturing; and

43 See www.uspto.gov/about/stratplan/ar/index.jsp to access the annual “Performance and Accountability Reports.” In each

report, the Top 50 Trademark Registrants tables are Table 29B within the USPTO Workload Tables in section 5, “Other

Accompanying Information.” 

44 This subscription-based dataset is available online at businessbrowser.onesource.com/homepage.aspx.

45 As the results will highlight, classifying a company into a single NAICS industry is not straightforward. Generally,

this report used the OneSource entry for the parent company of the firm in the top 50 listing to assign an industry

code. The exceptions were when a company did not appear in OneSource and when the listed firm’s industry differed

considerably from the parent company’s industry. As an example of the latter case, Bath & Body Works is a health and

personal care store (NAICS 4461) even though its parent company Limited Brands, Inc. is classified under clothing

stores (NAICS 4481). Other publicly available data were used to classify companies not included in OneSource. 

46 Toys, jewelry, sporting goods, pencils, signs, musical instruments, buttons, and caskets, among other goods, are

some of the product lines in the miscellaneous manufacturing industry. Games and toys, however, are what dominate

the trademarking activity for this NAICS code, as Hasbro, Mattel, International Game Technology, and WMS

Gaming are each classified within “Other miscellaneous manufacturing.” These four companies account for

18 of the 32 appearances for this NAICS code in the top 50 lists.
motion picture and video industries.47 The industries that were selected using this approach

further validated the trademark-intensity approach, as 10 of the 14 industries identified here

were also flagged based on their trademark intensity. The four additional industries are sugar

and confectionary product manufacturing, motor vehicle manufacturing, grocery stores, and

radio and television broadcasting.

Table 4. Industries with Five or More Appearances in the Listings of

Top 50 Trademark Registering Companies, FY 2006-10

Number of NAICS Top 50 code Industry title

appearances

3399 Other miscellaneous manufacturing 32

3254 Pharmaceutical and medicine manufacturing 30

3256 Soap, cleaning compound, and toiletry product manufacturing 29

5121 Motion picture and video industries 14

5111 Newspaper, periodical, book, and directory publishers 9

5151 Radio and television broadcasting 9

5241 Insurance carriers 7

3343 Audio and video equipment manufacturing 7

3121 Beverage manufacturing 7

7132 Gambling industries 6

4451 Grocery stores 6

3361 Motor vehicle manufacturing 6

3352 Household appliance manufacturing 5

3113 Sugar and confectionery product manufacturing 5

Source: ESA calculations using data from the USPTO Annual Reports, Table 29B and OneSource.

Intellectual Property and the U.S. Economy: Industries in Focus

17

47 Three companies were responsible for the bulk of the top 50 trademark registrations in the motion picture and video

industry: Twentieth Century Fox, Warner Brothers, and World Wrestling Entertainment. The fact that these three

companies are classified principally in the motion picture and video industry helps illustrate the difficulty of

summarizing large enterprises’ activities within a single industry code.
Intellectual Property and the U.S. Economy: Industries in Focus

18

Random Sample of Trademark Registrations

Methodology

One shortcoming of identifying industries based on the trademark intensities or top

50 appearances is that these approaches tend to bias selection toward larger companies that

register a greater number of trademarks. Moreover, these approaches can fail to account for the

critical importance that single trademarks may hold for large entities (for instance, Coca-Cola

soft drinks) or differences in industry composition and concentration. These methods also can

miss industries composed of smaller companies that may account for many trademarks as a

group but do not otherwise fall in the USPTO top 50 listing. To help overcome these

shortcomings, we supplemented the analyses with a random sample of registrants drawn from

the universe of all 166,844 trademarks registered in FY 2010. These data were generated by

USPTO using publicly available source data.48 They comprise all 106,560 trademark

registrants, both corporate and individual, including company/person name and number of

trademarks registered in that year. To measure the industry share of total registered trademarks,

a random sample of 300 registrations was drawn from this dataset. U.S. companies were

listed as the registrant on 196 of these 300 trademark registrations, or about two-thirds.49

We assigned four-digit NAICS industry codes to these firms using the same procedure

employed for the top 50 corporate registrants.50 Although limited in size, the sample’s industry

distribution reinforces the breadth and depth of trademarking activity seen in the other data

highlighted throughout this report.

One limitation of this approach is that the sample was drawn from records that pertain to only

a single year. This may result in the under-identification of industries that generally register

frequently in an average year, but, for some reason, were less active in 2010. The sample size is

another important limitation. The sample we used was small because assigning NAICS codes

to each company requires the use of many resources. In an ideal data world, the USPTO

trademark registry would include each corporate registrant’s NAICS code; however, such

information is not provided in trademark applications and therefore is not included in the

USPTO database. The process of assigning NAICS codes to companies was especially

cumbersome because many of the firms drawn from the sample were small businesses with few

employees and little publicly available information from which to find or infer a NAICS

classification.

48 See USPTO Bulk Data available at www.google.com/googlebooks/uspto.html.

49 This analysis was restricted to U.S.-owned firms because of the great difficulty in assigning NAICS codes to small,

foreign-owned firms.

50 Because the sample was drawn by registrations as opposed to registrants, a single individual or company could be

drawn more than once. One company was selected twice in the sample, and so the 196 registrations corresponded to

195 firms.
Results

Table 5 below lists the NAICS industries as well as the share of registrations within the sample

for all industries with at least five registrations that were drawn from the sample. We recognize

that setting the limit at five registrations is somewhat arbitrary. Because there were no natural

breaks in the sample distribution of trademark registrations, we chose this cutoff because it was

two standard deviations above the mean and thus a relatively high bar. The seven industries

listed in Table 5 account for one-fifth of trademark registrations from the 196 U.S. companies

in our sample. Consistent with the list of trademark-intensive industries selected thus far, the

ones selected based on the sample span a number of major industry sectors, including

manufacturing, retail trade, wholesale trade, and professional and business services.

Furthermore, six of the seven selected industries had already been selected as trademarkintensive based on their trademark intensities. The sole addition is clothing stores, which was

one of the two NAICS categories with the highest share of registrations in the sample; the other

was management, scientific, and technical consulting services. The selection of these seven

industries will be further reinforced through a review of corporate brand rankings and

trademark class data. 

Table 5. Percent Distribution of Trademark Registrations of Selected

Industries from Sample of U.S.-Owned, Trademark-Registrant Companies,

Ranked by Percent, FY 2010

NAICS

code Industry title Percent

4481 Clothing stores 3.5%

5416 Management, scientific, and technical consulting services 3.5%

3121 Beverage manufacturing 2.5%

4234 Professional and commercial equipment and supplies merchant wholesalers 2.5%

4511 Sporting goods, hobby, and musical instrument stores 2.5%

5112 Software publishers 2.5%

5417 Scientific research and development services 2.5%

Source: ESA calculations using trademark registration data provided by USPTO and OneSource.

Intellectual Property and the U.S. Economy: Industries in Focus

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Intellectual Property and the U.S. Economy: Industries in Focus

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Identifying Trademark-Intensive Industries

This combined approach for determining trademark intensity by industry—and any

comprehensive examination of the USPTO trademark registration database—shows that a wide

range of industries use trademarks in commerce. This fact maps onto our everyday experience,

in which trademarks, brands, and logos are ubiquitous in the marketplace. The results also

show that the latter two approaches tend to complement the first approach. The first approach

is the most data intensive, and relies on a systematic matching of the entire U.S. trademark

registration dataset over a five-year period to a comprehensive dataset of all publicly traded

companies in the U.S. Nevertheless, it has limitations, as it may undercount some industries

and smaller companies, either because a single trademark in an industry that is highly

concentrated may be underrepresented (for instance, Coca-Cola and Pepsi-Cola) or because

many small companies are not publicly traded. While the second and third approaches were

meant to mitigate these shortcomings, it is interesting to note that there was substantial

correlation in the results, with the majority of industries chosen in these two methods also being

selected using the criteria in the first analysis. Nevertheless, our intention to capture a broad

swath of trademark-intensive industries and the recognition that there were conceptual

shortcomings in each approach has led us to treat all three approaches as complementary, and to

define as trademark-intensive any industry identified by any of the three approaches. As will be

detailed, the final results are broadly corroborated by a separate review of trademark class data

and corporate brand rankings.

Table 6 shows the complete list of 60 trademark-intensive industries, which again are defined as

any four-digit NAICS industry that is selected based on any one of the three methods:

trademark intensity, top 50 registrants, or trademark registration sample. All but five of the

industries listed in Table 6 were selected based on their above-average trademark intensity. The

five additional industries were selected based on either their top 50 registrations or the

trademark registration sample. Only one industry, beverage manufacturing (NAICS 3121), was

selected through all three methods. 
Intellectual Property and the U.S. Economy: Industries in Focus

21

Table 6. Trademark-Intensive Industries and Selection Criteria

Selection criteria

NAICS Trademark Top code Industry title

intensity 50 Sample

2111 Oil and gas extraction X

2361 Residential building construction X

3112 Grain and oilseed milling X

3113 Sugar and confectionery product 

manufacturing X

3115 Dairy product manufacturing X

3119 Other food manufacturing X

3121 Beverage manufacturing X X X

3162 Footwear manufacturing X

3221 Pulp, paper, and paperboard mills X

3222 Converted paper product manufacturing X

3231 Printing and related support activities X

3251 Basic chemical manufacturing X

3252 Resin, rubber, and artificial fibers X

3254 Pharmaceutical and medicine manufacturing X X

3256 Soap, cleaning compound, and toiletries X X

3259 Other chemical product and preparations X

3261 Plastics product manufacturing X

3322 Cutlery and handtool manufacturing X

3329 Other fabricated metal product manufacturing X

3332 Industrial machinery manufacturing X

3333 Commercial and service industry 

manufacturing X

3336 Turbine and power transmission equipment X

3339 Other general purpose machinery 

manufacturing X

3341 Computer and peripheral equipment X

3342 Communications equipment manufacturing X

3343 Audio and video equipment manufacturing X X

3345 Electronic instrument manufacturing X

3352 Household appliance manufacturing X X

3353 Electrical equipment manufacturing X

3359 Other electrical equipment and components X

3361 Motor vehicle manufacturing X
Table 6. Trademark-Intensive Industries and Selection Criteria—Continued

Selection criteria

NAICS Trademark Top code Industry title

intensity 50 Sample

3371 Household and institutional furniture X

3391 Medical equipment and supplies 

manufacturing X

3399 Other miscellaneous manufacturing X X

4234 Commercial equip. merchant wholesalers X X

4242 Druggists’ goods merchant wholesalers X

4244 Grocery and related product wholesalers X

4451 Grocery stores X

4481 Clothing stores X

4511 Sporting goods and musical instrument stores X X

4541 Electronic shopping and mail-order houses X

5111 Newspaper, book, and directory publishing X X

5112 Software publishers X X

5121 Motion picture and video industries X X

5151 Radio and television broadcasting X

5152 Cable and other subscription programming X

5174 Satellite telecommunications X

5179 Other telecommunications X

5191 Other information services X

5221 Depository credit intermediation X

5239 Other financial investment activities X

5241 Insurance carriers X X

5311 Lessors of real estate X

5331 Lessors of nonfinancial intangible assets X

5416 Management and technical consulting X X

5417 Scientific research and development X X

5614 Business support services X

5615 Travel arrangement and reservation X

6214 Outpatient care centers X

7132 Gambling industries X X

Source: ESA and USPTO calculations.

Intellectual Property and the U.S. Economy: Industries in Focus

22
Brands

Firms with high-value brands are likely to seek protection for those brands through trademark

law. To check robustness of the methodology for selected trademark-intensive industries, we

examined the Interbrand listing of the “Best Global Brands in 2010,” focusing on the extent to

which firms with highly valued corporate brands operate in industries that have been identified

as trademark-intensive.51

Methodology

Briefly, Interbrand’s methodology for ranking global brands considers the ongoing investment

and management of the brand as a business asset.52 Three key aspects contribute to the

assessment of each brand:

■ Financial performance measures an organization’s raw financial return to the investors. 

■ Role of brand measures the portion of the decision to purchase that is attributable

to brand.

■ Brand strength measures the ability of the brand to secure the delivery of expected future

earnings. 

Before discussing the brand rankings, it is important to review caveats and differences in scope

between Interbrand’s approach and our approach for identifying trademark-intensive industries.

To be included in Interbrand’s ranking, companies must have corporate brands that are truly

“global, visible, and relatively transparent.” First, the company must be present on at least three

continents, including “broad coverage in growing and emerging markets.” At least 30 percent

of revenues must be from outside of the home country, with no more than 50 percent from any

single continent. Second, the brand’s public profile must extend beyond its own marketplace.

Third, firms must prove their profitability through publicly available financial data. These

criteria are restrictive relative to the rest of this report, in which the general focus is on all

corporations, regardless of their global presence or profits. 

Also, it should be emphasized that “brand” refers to single corporate brands as opposed to

product brands. This distinction led Interbrand to exclude pharmaceutical companies, which

are considered better identified through specific products than the companies themselves.

Similarly, Wal-Mart is excluded not because it is insufficiently global as a company, but because

it does not operate under a single Wal-Mart brand globally.53

The corporate brands included in Interbrand’s Best Global Brands are identified by company

name, and we assigned four-digit NAICS codes to each listed company using OneSource,

Intellectual Property and the U.S. Economy: Industries in Focus

23

51 Corporate brand generally is equivalent to company name (with its corresponding protected logo), as opposed to a

specific product brand, with some exceptions, such as Sprite and Budweiser.

52 Interbrand 2011a.

53 Wal-Mart does top the separate rankings of the best retail brands in 2011. See Interbrand 2011b. 
following the same methodology we used to assign NAICS codes to the top 50 trademark

registrants.54 We then compared the industries with top-ranked brands with the industries

selected as trademark-intensive. 

Results

We discovered considerable overlap between the trademark-intensive industries and those

with high-ranking brands. Upon assigning NAICS codes to each brand, we calculated that the

top 100 ranked brands corresponded to 41 different four-digit NAICS industries, and 24 of

these industries (covering 70 brands) were selected as trademark-intensive. Put another way,

24 of the 60 trademark-intensive industries also had high-ranking brands either in the United

States or abroad.

Table 7 lists the 24 trademark-intensive industries in which 70 of the various top 100 brands

operate.55 Beverage manufacturing (NAICS 3121) was the most heavily represented industry on

the list, with 11 of the top 100 brands—including Coca-Cola, Interbrand’s #1 ranked global

brand, as well as Pepsi (#23), Budweiser (#30), Sprite (#61), Jack Daniel’s (#80), and six foreign

brands.56 This industry is noteworthy because it also was the only one to be selected as

trademark-intensive based on all three measures.

While there is much overlap between the trademark-intensive industries and the top-ranked

brands, there also were 17 industries that were not considered trademark-intensive based on

any of our three measures. Several happened to be among the top 10 brands, including IBM

(#2, NAICS 5415), McDonald’s (#4, NAICS 7222), General Electric (#5, NAICS 5222), and

Intel (#7, NAICS 3344). Nonetheless, these brands are captured to some extent elsewhere in

the report. IBM and Intel operate in industries that are found to be copyright- and patentintensive industries, respectively. General Electric, like a number of the companies examined in

this report, operates in various industries. Although its consumer finance arm is in an industry

that is not found to be trademark-intensive, other parts of the company are in trademarkintensive industries, such as turbine and power transmission equipment (NAICS 3336). The

food service industry, such as limited-service eating places (NAICS 7222), is not captured by

Intellectual Property and the U.S. Economy: Industries in Focus

24

54 The difficulty of assigning a single NAICS code to companies is further highlighted in our analysis of these

companies. Take, for example, General Electric, which as described in OneSource is a “diversified technology, media

and financial services company... [with] products and services includ[ing] aircraft engines, power generation, water

processing, security technology, medical imaging, business and consumer financing, media content and industrial

product.” No one NAICS code can capture GE. In terms of sales, GE Capital is largest of the company’s five principal

segments, accounting for 32 percent of total revenue in calendar year 2010, and by this criteria, it makes sense to

classify GE in nondepository credit intermediation (NAICS 5222). Still, this does miss the fact that the vast majority

of GE’s revenues is from other sectors. Two of those sectors, interestingly, also cover industries selected as trademarkintensive. The NBC Universal business segment operates in radio and television broadcasting (NAICS 5151) while part

of the Home & Business Solutions segment includes household appliance manufacturing (NAICS 3352). Together

these two segments account for 17 percent of total revenue. It should be noted that this discussion applies to data prior

to GE’s sale of NBC Universal to Comcast.

55 For a complete listing of Interbrand’s top 100 Global Brands, see Interbrand 2011a.

56 Although Budweiser is part of Anheuser-Busch InBev N.V., which is based in Leuven, Belgium, Interbrand considers

the Budweiser brand to be American.
Intellectual Property and the U.S. Economy: Industries in Focus

25

any of the trademark-intensive measures or elsewhere in this report. This is not to say that

trademarks or other forms of IP protection are unimportant for protecting food-service

industry brands, four of which are in the top 100. 

Table 7. Trademark-Intensive Industries with Top 100 Global Brands in 2011

NAICS

code Industry title Brand

2111 Oil and gas extraction Shell

3112 Grain and oilseed milling Kellogg’s

3115 Dairy product manufacturing Nestle Danone

Coca-Cola Pepsi Nescafe

Budweiser Sprite Jack Daniel’s

3121 Beverage manufacturing Moet and Chandon Corona

Smirnoff Johnnie Walker

Heineken

3162 Footwear manufacturing Nike Adidas

3222 Converted paper product 

manufacturing Kleenex

3254 Pharmaceutical and medicine 

manufacturing Johnson and Johnson

3256 Soap, cleaning compound, and toiletries Gillette L’Oreal Colgate

Avon Nivea Lancome

3341 Computer and peripheral equipment HP Apple Canon

Dell

3342 Communications equipment 

manufacturing Nokia Cisco Blackberry

3343 Audio and video equipment Samsung Sony Philips

manufacturing Panasonic

3345 Electronic instrument manufacturing Siemens

3361 Motor vehicle manufacturing

Toyota Mercedes BMW

Honda Ford Volkswagen

Audi Hyundai Porsche

Ferrari

3399 Other miscellaneous manufacturing Nintendo Cartier

4481 Clothing stores Zara Gap

4541 Electronic shopping and 

mail-order houses Amazon.com EBay

5111 Newspaper, book, and directory publishers Thomson Reuters

5112 Software publishers Microsoft Oracle SAP

Adobe

5151 Radio and television broadcasting Disney MTV

5191 Other information services Google Yahoo

5221 Depository credit intermediation J.P. Morgan Santander

5239 Other financial investment activities Citi UBS

5241 Insurance carriers AXA Allianz Zurich

5416 Management and technical consulting Accenture

Source: ESA calculations using Interbrand’s Top 100 Global Brands and data from OneSource.
Intellectual Property and the U.S. Economy: Industries in Focus

26

Trademark Registrations by Class

As discussed earlier, the USPTO organizes trademark registrations by class as opposed to

industry. For several reasons, it is not possible to use the registration class data to identify

trademark-intensive industries by four-digit NAICS industry. First, the classes are not

sufficiently detailed for our purposes. There are 49 trademark classes, as opposed to 313 fourdigit NAICS industries. So, even if it were possible to clearly define the correspondence

between class and NAICS, a meaningful level of detail would be lacking.

Second, there is no straightforward correspondence between trademark classes and industries

because the classes and NAICS industries are conceptually quite distinct. NAICS industries are

defined according to the principal business activity of an establishment. Trademark classes

indicate the type of good or service associated with a particular trademark. In a sense, the

classes tell us what type of product is carrying the protected mark or logo. Consider the Whole

Foods example cited earlier. Their “365 Everyday Value” logo appears on a wide range of goods

covering 10 different trademark classes. As another example, consider Five Guys, the fast food

franchise. This company has protected its “Five Guys” logo within six different trademark

classes, ranging from meats and processed foods (for the sandwiches), to staple foods (processed

peanut and fried potatoes), non-alcoholic beverages, advertising and business (franchising),

clothing, and vehicles (to protect license plate holders with the logo).57 Within the NAICS

framework, however, Five Guys would simply be considered a limited-service eating place

(NAICS 7222), a service-providing industry. So, while Five Guys is a service-provider under

NAICS, most of its trademark classes relate to goods, that is, the “vessels” on which the

company logo appears. 

Despite the difficulty in precisely relating trademark classes to NAICS industries, it is

worthwhile to look for similarities between the distribution of trademark registrations by class

and our selection of trademark-intensive industries. Table 8 lists total registrations by

trademark class for the period from November 16, 1999 to November 15, 2009, ranking the

registration classes by trademark count. These data provide insight into which areas of the

economy (by class) take advantage most often of trademark protection through the Federal

trademark registration system. 

The top seven categories accounted for more than half of all registrations in the 2000s. Three

of these categories—advertising and business, education and entertainment, and insurance and

financials—are very broad and cover services ranging from wholesale and retail trade to

professional and business services; financial services; insurance; educational services; and the

arts, entertainment, and recreation industry. At a superficial level, it rings true that these sectors

rely on trademarks because they cover many of the services and brands that consumers use on a

daily basis. Not surprisingly, several of the trademark-intensive industries correspond to these

classes; however, many other industries do as well. On the other hand, consider the trademark

classes for light beverages as well as wine and spirits, both of which would be expected to

57 This trademark is serial number 85255019 and can be found by using the online search engine at

tarr.uspto.gov/servlet/tarr?regser=serial&entry=85255019.
correspond to beverage manufacturing (NAICS 3121). This industry is clearly trademarkintensive as it was the only industry to be selected by all three criteria (trademark intensities, top

50 list, and sample). Furthermore, several beverages appeared in the top 100 brands Yet, the

light beverages class only accounted for 0.8 percent of registrations (15,253) while wine and

spirits accounted for 1.1 percent (20,727) for FY 2000 to FY 2009.

Table 8. Trademark Registrations by Class, Ranked by

Number of Registrations, FY 2000-09

Trademark registrations

Trademark Class title Percent of Cumulative class Total total percent

9 Electrical and scientific apparatus 209,639 11.6% 11.6%

35 Advertising and business 184,274 10.2% 21.9%

41 Education and entertainment 151,547 8.4% 30.3%

42 Computer and scientific 136,025 7.5% 37.8%

16 Paper goods and printed matter 97,739 5.4% 43.2%

36 Insurance and financial 92,759 5.1% 48.4%

25 Clothing 91,923 5.1% 53.5%

5 Pharmaceuticals 57,081 3.2% 56.6%

28 Toys and sporting goods 53,292 3.0% 59.6%

3 Cosmetics and cleaning preparations 51,940 2.9% 62.5%

30 Staple foods 43,550 2.4% 64.9%

37 Building construction and repair 39,557 2.2% 67.1%

7 Machinery 36,683 2.0% 69.1%

38 Telecommunications 32,482 1.8% 70.9%

11 Environmental control apparatus 31,374 1.7% 72.7%

10 Medical apparatus 30,872 1.7% 74.4%

20 Furniture and articles, nec. 29,527 1.6% 76.0%

29 Meats and processed foods 27,188 1.5% 77.5%

1 Chemicals 27,009 1.5% 79.0%

44 Medical, beauty, and agricultural 26,404 1.5% 80.5%

12 Vehicles 25,891 1.4% 81.9%

43 Hotels and restaurants 25,825 1.4% 83.4%

39 Transportation and storage 25,562 1.4% 84.8%

21 Housewares and glass 25,356 1.4% 86.2%

6 Metal goods 21,724 1.2% 87.4%

14 Jewelry 21,422 1.2% 88.6%

Intellectual Property and the U.S. Economy: Industries in Focus

27
Table 8. Trademark Registrations by Class, Ranked by

Number of Registrations, FY 2000-09—Continued

Trademark registrations

Trademark Percent of Cumulative class Class title

Total total percent

18 Leather goods 20,843 1.2% 89.7%

33 Wine and spirits 20,727 1.1% 90.9%

40 Treatment of materials 19,532 1.1% 92.0%

19 Nonmetallic building materials 17,801 1.0% 93.0%

32 Light beverages 15,253 0.8% 93.8%

31 Natural agricultural products 14,744 0.8% 94.6%

45 Personal 14,390 0.8% 95.4%

24 Fabrics 13,233 0.7% 96.2%

17 Rubber goods 11,637 0.6% 96.8%

8 Hand tools 11,098 0.6% 97.4%

2 Paints 8,352 0.5% 97.9%

4 Lubricants and fuels 7,502 0.4% 98.3%

34 Smokers’ articles 5,004 0.3% 98.6%

27 Floor coverings 4,771 0.3% 98.8%

26 Fancy goods 4,698 0.3% 99.1%

22 Cordage and fibers 3,809 0.2% 99.3%

13 Firearms 3,628 0.2% 99.5%

15 Musical instruments 3,555 0.2% 99.7%

200 Collective membership 1,577 0.1% 99.8%

23 Yarns and threads 1,423 0.1% 99.9%

B Services certification mark 1,391 0.1% 100.0%

A Goods certification mark 765 0.0% 100.0%

Total 1,802,378 100.0% 100.0%

Source: ESA calculations using unpublished USPTO data.

Note: The cumulative percent figures may not equal the sum of the percent of total figures because of rounding.

Intellectual Property and the U.S. Economy: Industries in Focus

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Intellectual Property and the U.S. Economy: Industries in Focus

29

Copyrights

Overview

Copyrights, the third form of IP rights covered in this report, protect “original works of

authorship.”58 These works must be fixed in a tangible form of expression, meaning that

concepts that never leave the confines of our minds cannot be copyrighted. Protection under

copyright, which lasts for the life of the author plus an additional 70 years, is secured

automatically when a work is created.59 Neither publication nor registration with the Copyright

Office is required to secure copyright protection. But registering a copyright does establish a

public record of the copyright, and it can be beneficial because of incentives provided to

encourage registration. For example, a registered copyright can be recorded with the U.S.

Customs and Border Protection to protect against the importation of infringing copies.60

More than 33.7 million copyrights have been registered in the United States since 1790, when

Congress enacted the first Federal copyright law. Of these, approximately 150,000 were

registered between 1790 and the centralization of copyright functions in the Library of

Congress in 1870.61 In 2009, more than 382,000 basic copyrights were registered. 

The types of works that can be copyrighted are outlined in the 1976 Copyright Act. A partial

list of copyrighted materials includes the following: 

■ literary works (including fiction, nonfiction, and computer programs)

■ musical works, including any accompanying words

■ dramatic works, including any accompanying music

■ pantomimes and choreographic works

■ pictorial, graphic, and sculptural works

■ motion pictures and other audiovisual works

■ sound recordings

■ architectural works, including vessel hull designs

Of the 382,000 registrations in 2009, about 93,000 covered performing arts works, such as

films, musical and dramatic works, and choreography. There were 75,000 registrations of works

58 U.S. Copyright Office 2008, 2.

59 A work is “created” when it is fixed in a copy for the first time, regardless of whether the work is published or not.

60 U.S. Copyright Office 2008, 7. 

61 See the Brief History of the Copyright Office at www.copyright.gov/circs/circ1a.html. Copyright registration data are

published in U.S. Copyright Office 2009, 68.
of visual and applied arts. These covered fine and graphic arts, sculptures, technical drawings

and models, photographs and cartographic works, and commercial prints and labels.

Registrations of sound recordings totaled 42,000.62 

Identifying Copyright-Intensive Industries

Our methodology for designating copyright-intensive industries draws heavily from definitions

established by the World Intellectual Property Organization’s (WIPO) Guide on Surveying the

Economic Contribution of the Copyright-based Industries.

63 A series of reports by Stephen Siwek

entitled Copyright Industries in the U.S. Economy have applied these definitions to the U.S.

economy.64 While this established literature underlies our analysis, we used a more narrow

definition of copyright-intensive industries than WIPO, focusing on industries that produce

copyrighted work and excluding several industries associated with the distribution of

copyrighted material. This deviation from the WIPO Guide was needed in order to maintain

internal consistency with our measures of patent- and trademark-intensive industries.

Methodology

Because WIPO’s Guide on Surveying the Economic Contribution of the Copyright-based Industries

clearly distinguishes the type of works that can be copyrighted, the industries in which those

works are created, and the downstream (distribution) industries delivering the produced

copyrighted works, it is possible to develop a list of copyright-intensive industries that is

comparable in scope to our lists of patent- and trademark-intensive industries. We started by

focusing on “core” copyright industries, which WIPO defines as industries “wholly engaged in

creation, production and manufacturing, performance, broadcast, communication and

exhibition, or distribution and sales of works and other protected subject matter.”65 In other

words, core copyright industries are considered ‘core’ because they either produce copyrighted

materials or bring them to market. 

For this report, we are only concerned with the set of industries that are primarily responsible

for the creation or production of copyrighted materials and designate them as copyrightintensive. Thus, to the extent possible using four-digit NAICS industry codes, we excluded

industries whose primary purpose is to distribute copyright materials to businesses, consumers,

or both. For example, we did not count industries such as book, periodical, and music stores

(NAICS 4512) or consumer goods rental (NAICS 5322), which includes video rentals, as

copyright-intensive even though they are part of the “core” category in the WIPO guide.66 Our

Intellectual Property and the U.S. Economy: Industries in Focus

30

62 Ibid., 69.

63 World Intellectual Property Organization 2003.

64 See, for example, Siwek 2009.

65 World Intellectual Property Organization 2003, 29. The core copyright industries represent one of four main groups

of copyright-based industries. The others are interdependent, partial, and non-dedicated support industries. 

66 This discussion should not imply that distribution industries as a whole cannot by our definitions be considered IPintensive. As discussed above, a broad range of industries seek trademark protection, including distribution industries

like clothing stores, which are identified as IP-intensive.
Intellectual Property and the U.S. Economy: Industries in Focus

31

definition is narrower than WIPO’s in order to be consistent with our treatment of patent- and

trademark-intensive industries, where the industries most responsible for the production of

protected IP are the main focus. This approach simply reflects our goal of examining the

industries in the economy that are most responsible for the production of protected IP and use

of this approach is not a criticism of WIPO’s guidelines.

One conceptual distinction between the approach taken here and that selected in the patent and

trademark sections is worth noting. Throughout this report, the focus was on industries that

produce protected IP, whether patents, trademarks, or copyrights. In the case of patents and

trademarks, we defined “intensive” industries as the subset of all patent or trademark producers

that had high scores in various “intensity” measures, whereas we defined as copyright-intensive

essentially all industries associated with the production of copyrighted materials.

Results

Table 9 lists the copyright-intensive industries. All are involved in the creation and/or recording

(in print, magnetically, or digitally) of protected works. For industries such as other

information services (NAICS 5191), the title of which does not clearly indicate what protected

materials are produced, the relevant copyrighted product is listed in parentheses. 

Table 9. Copyright-Intensive Industries

NAICS code Industry title

5111 Newspaper, periodical, book, and directory publishers

5112 Software publishers

5121 Motion picture and video industries

5122 Sound recording industries

5151 Radio and television broadcasting

5152 Cable and other subscription programming

5191 Other information services (news syndicates and internet sites)

5414 Specialized design services (visual and graphic arts)

5415 Computer systems design and related services (software and databases)

5418 Advertising, public relations, and related services

5419 Other professional, scientific, and technical services 

(photography and translation)

7111 Performing arts companies

7115 Independent artists, writers, and performers

Source: ESA selection based on World Intellectual Property Organization 2003.
Intellectual Property and the U.S. Economy: Industries in Focus

32

Some of the selected industries are involved in both the production and distribution of

copyrighted materials since both functions are often performed within a single business

establishment.67 The newspaper industry provides a good example of the blurry line between

the creation and distribution of copyrighted materials. We considered newspaper, periodical,

book and directory publishers (NAICS 5111) to be copyright-intensive because much

copyrighted material actually is developed within establishments classified in this industry,

as evidenced by the fact that this industry had 31,000 reporters and correspondents,

25,000 graphic designers, and 4,000 photographers on its payrolls in 2010.68

This line of reasoning underlies the inclusion of several industries on the list, such as sound

recording, broadcasting, cable programming, and performing arts companies. These industries

have many “creators” (writers, composers, choreographers, and others) directly on their payrolls,

in addition to other independent artists and content creators under individual contracts with

their companies.

Our list of copyright-intensive industries also includes two additional industries directly

involved in the writing and publishing of newspapers: independent artists, writers, and

performers (NAICS 7115) and other information services (NAICS 5191), which includes news

syndicates. However, we excluded printing and related support activities (NAICS 3231),

because its role is simply to print the newspapers themselves. WIPO considers this a “core”

copyright industry because it is directly involved in creating a “vessel” for copyrighted material,

meaning that it exists in order to deliver copyrighted materials in a tangible form to a consumer

or audience. However, printing is distinct from the actual development of the copyrighted

materials (such as news articles and photographs), so we did not consider it to be a copyrightintensive industry.

As another example, consider the manufacturing and reproducing magnetic and optical media

industry (NAICS 3346). This industry produces software CDs and DVDs, as well as other

prerecorded disks, tapes and vinyl records. While inextricably linked to copyright-intensive

industries, this industry is not part of the actual process of developing and recording software or

music, but rather a part of the downstream process of putting the material on a tangible vessel.

So as with the printing example above, while manufacturing and reproducing magnetic and

optical media is a WIPO-defined core industry, it is not counted as copyright-intensive in this

report. It should be noted, however, that both printing and related support activities (NAICS

3231) and manufacturing and reproducing magnetic and optical media (NAICS 3346) were

found to be trademark-intensive.

67 World Intellectual Property Organization 2003, 27.

68 These data are from the Bureau of Labor Statistics, Occupational Employment Statistics program and are for private

wage and salary workers in newspaper, periodical, book and directory publishers (NAICS 5111). See

www.bls.gov/oes/current/naics4_511100.htm#27-0000.
Intellectual Property and the U.S. Economy: Industries in Focus

33

IP-Intensity and the Use of Intellectual

Property Protection

Before reviewing the complete list of IP-intensive industries, we should note that defining

“IP intensity” as the use of intellectual property protection is an approach open to criticism.

Although commonly used in the scientific literature, such intensity measures tend to overweight

those industries that more commonly use patents, trademarks, or copyrights for purposes other

than activities closely related to R&D or commercialization per se.

69

The term “IP-intensive” defined in this report is not necessarily directly related to the value or

purpose of the IP held by companies. In some industries a single patent may support revenues

in the billions of dollars, while in other industries, many patents may be required just to market

marginally profitable products.70, 71 The same logic holds for trademarks and copyrights.72

For example, the Carnegie-Mellon University survey, previously mentioned, shows significant

differences across industries in how companies acquire and use patents.73 These findings are not

surprising. First, companies employ other protections, such as trade secrets, that may be a

substitute for patent protection. And, because the term of protection is limited, patent efficacy

can be diminished by lengthy product and process development. Often companies will seek

patent protection early in that timeline (as patent costs remain relatively inexpensive in the

United States), only to determine after further research and development that the patent

protection was neither needed nor particularly useful in the final outcome. 

Prior economic studies have also shown that patents can be used for defensive purposes, and our

method for selecting IP-intensive industries necessarily sweeps widely, including industries in

which companies seek patent protection regardless of the purpose.74 To understand the various

motivations for patenting, the Carnegie-Mellon study also focused on the reasons companies in

different industries sought patent protection and the multiple uses of patents. The reasons

included earning licensing revenue, use in negotiations, blocking competitors, enhancing

reputation, or as a measure of employee performance. The research found that companies

reported that their patents often served multiple purposes. All drug companies surveyed, for

instance, used product patenting to prevent copying, while 97 percent used product patenting

to block competitors, 69 percent to enhance the company’s reputation, and 61 percent to aid in

69 Jaffe and Trajtenberg 2002.

70 The pharmaceutical industry is a prime example of the former. Merck & Company, for instance, lost billions of

dollars in sales beginning in 2008 on the osteoporosis drug Fosamax when generic manufacturers successfully

invalidated its core patent. See Higgins and Graham 2009, 370-71.

71 Electronics products are prime examples of the latter, as products from Motorola, Samsung, and Nokia, now

competing with Apple’s iPhone in the hand-held market, all require the rights to many patents in order to be legally

sold in the U.S. market.

72 The appendix to this report examines the extent to which industries selected as IP-intensive have relatively high

revenue shares from the licensing of rights to use protected intellectual property and other IP-related product lines.

73 Cohen et al. 2000.

74 Hall and Ziedonis 2001.
Intellectual Property and the U.S. Economy: Industries in Focus

34

negotiations. In the aerospace industry, 57 percent of companies reported using product

patents for licensing revenue, while 50 percent of those companies used process patents for the

same purpose. Among companies in the machine tool sector, 13 percent reported that they

used product patents as a measure of employees’ performance. Collectively, these findings show

that the term “use” is complex at the company level, and that complexity must be acknowledged

in interpreting the aggregated measures we report at the industry level.
Intellectual Property and the U.S. Economy: Industries in Focus

35

IP-Intensive Industries

Seventy-five IP-intensive industries emerged after combing through the lists of patent-,

trademark-, and copyright-intensive industries. (See Table 10.) This 75-industry total is

smaller than the sum of the parts. Indeed, there is considerable overlap between the patentintensive and trademark-intensive industry lists, as 18 of the 26 patent-intensive industries also

were identified among the 60 trademark-intensive ones. There also is some overlap between the

copyright-intensive and trademark-intensive list with six of the 13 copyright-intensive industries

also selected as trademark-intensive. By definition, however, there is no overlap between the

patent and copyright lists. The USPTO classified all patents within manufacturing industries,

whereas industries involved in the creation and/or recording of protected works are classified as

service-providing industries and not in the manufacturing sector. 

Table 10 also lists total employment of each IP-intensive industry. Employment refers to wage

and salary jobs as well as self-employment, which accounts for a sizeable portion of employment

in the copyright-intensive industries.75 Employment in IP-intensive industries totaled

27.1 million jobs in 2010. The next section will examine in more detail their contribution to

overall employment and gross domestic product in the U.S. economy as well as workers’ wages,

educational attainment, and foreign trade.

75 Unpaid family workers also are included in the employment estimates from the BLS Industry Productivity program.

However, because unpaid family workers account for only about one percent of the combined total of the self-employed

and unpaid family workers outside of agriculture, they are not referred to or analyzed elsewhere in this report.
Intellectual Property and the U.S. Economy: Industries in Focus

36

Table 10. IP-Intensive Industries and Selection Criteria

Selection criteria

NAICS Employment 

in 2010 Patent- Trademark- Copyright- code Industry title 

(1000 jobs) intensive intensive intensive

2111 Oil and gas extraction 163.3 X

2361 Residential building construction 934.3 X

3112 Grain and oilseed milling 58.3 X

3113 Sugar and confectionery product 

manufacturing 69.9 X

3115 Dairy product manufacturing 130.4 X

3119 Other food manufacturing 165.5 X

3121 Beverage manufacturing 169.5 X

3162 Footwear manufacturing 13.5 X

3221 Pulp, paper, and paperboard mills 112.7 X

3222 Converted paper product manufacturing 285.9 X

3231 Printing and related support activities 524.4 X

3251 Basic chemical manufacturing 143.1 X X

3252 Resin, rubber, and artificial fibers 90.1 X X

3253 Agricultural chemical manufacturing 36.7 X

3254 Pharmaceutical and medicine 

manufacturing 277.6 X X

3255 Paint, coating, and adhesive 

manufacturing 56.4 X

3256 Soap, cleaning compound, and toiletries 104.2 X X

3259 Other chemical product and 

preparations 84.9 X X

3261 Plastics product manufacturing 501.5 X

3322 Cutlery and handtool manufacturing 42.1 X

3329 Other fabricated metal product 

manufacturing 256.4 X

3331 Ag., construction, and mining 

machinery manufacturing 208.9 X

3332 Industrial machinery manufacturing 102.2 X X

3333 Commercial and service industry 

manufacturing 91.3 X X

3334 HVAC and commercial refrigeration 124.4 X

3335 Metalworking machinery manufacturing 156.1 X

3336 Turbine and power transmission

equipment manufacturing 91.5 X X

3339 Other general purpose machinery 

manufacturing 229.8 X X

3341 Computer and peripheral equipment 161.9 X X

3342 Communications equipment 

manufacturing 118.5 X X

3343 Audio and video equipment 

manufacturing 20.2 X X
Table 10. IP-Intensive Industries and Selection Criteria—Continued

Selection criteria

NAICS Employment 

in 2010 Patent- Trademark- Copyright- code Industry title

(1000 jobs) intensive intensive intensive

3344 Semiconductor and electronic 

component manufacturing 373.8 X

3345 Electronic instrument manufacturing 408.7 X X

3346 Magnetic media manufacturing and 

reproducing 26.3 X

3351 Electric lighting equipment 

manufacturing 46.2 X

3352 Household appliance manufacturing 60.7 X X

3353 Electrical equipment manufacturing 137.3 X X

3359 Other electrical equipment and 

components 118.7 X X

3361 Motor vehicle manufacturing 151.8 X

3371 Household and institutional furniture 245.8 X

3391 Medical equipment and supplies 

manufacturing 311.5 X X

3399 Other miscellaneous manufacturing 309.6 X X

4234 Commercial equip merchant 

wholesalers 615.4 X

4242 Druggists’ goods merchant wholesalers 193.3 X

4244 Grocery and related product 

wholesalers 735.3 X

4451 Grocery stores 2,521.6 X

4481 Clothing stores 1,114.4 X

4511 Sporting goods and musical

instrument stores 514.6 X

4541 Electronic shopping and 

mail-order houses 303.9 X

5111 Newspaper, book, and directory pub 530.9 X X

5112 Software publishers 259.8 X X

5121 Motion picture and video industries 414.6 X X

5122 Sound recording industries 36.4 X

5151 Radio and television broadcasting 216.7 X X

5152 Cable and other subscription 

programming 85.6 X X

5174 Satellite telecommunications 14.6 X

5179 Other telecommunications 127.5 X

5191 Other information services 145.5 X X

5221 Depository credit intermediation 1,735.6 X

5239 Other financial investment activities 427.4 X

5241 Insurance carriers 1,368.2 X

5311 Lessors of real estate 823.9 X

5331 Lessors of nonfinancial intangible 25.5 X

Intellectual Property and the U.S. Economy: Industries in Focus

37
Intellectual Property and the U.S. Economy: Industries in Focus

38

Table 10. IP-Intensive Industries and Selection Criteria—Continued

Selection criteria

NAICS Employment 

in 2010 Patent- Trademark- Copyright- code Industry title

(1000 jobs) intensive intensive intensive

5414 Specialized design services 242.6 X

5415 Computer systems design and

related services 1,595.1 X

5416 Management and technical consulting 1,233.8 X

5417 Scientific research and development 638.2 X

5418 Advertising, PR, and related services 461.2 X

5419 Other professional and 

technical services 673.4 X

5614 Business support services 883.9 X

5615 Travel arrangement and reservation 201.7 X

6214 Outpatient care centers 636.6 X

7111 Performing arts companies 132.1 X

7115 Independent artists, writers, 

and performers 306.1 X

7132 Gambling industries 133.9 X

Source: ESA calculations using data from the Bureau of Labor Statistics’ Industry Productivity program.

Note: Employment includes wage and salary jobs, the self-employed, and unpaid family workers and is measured in

thousands of jobs.
Intellectual Property and the U.S. Economy: Industries in Focus

39

III. IP-Intensive Industries in the Economy

Employment

E mployment totaled 27.1 million jobs in IP-intensive industries in 2010, representing

18.8 percent of all jobs in the economy. (See Figure 1.) Our definition of jobs includes

not just payroll (or wage and salary workers), but also the self-employed and unpaid

family workers.76 Labor market analyses of this type often overlook the self-employed, but as

will be seen, they are a critical source of staff for copyright-intensive industries, and to a lesser

extent, for trademark-intensive industries. 

Figure 1. Employment in IP-Intensive Industries, 2010

Given that 60 of the 75 IP-intensive industries were considered trademark-intensive, it

follows that these industries would account for the majority of IP-intensive jobs (22.6 million

or 83 percent of all IP-intensive jobs). Indeed, employment in the patent- and copyright22,590

5,100

27,065

0

5,000

10,000

15,000

20,000

25,000

30,000

Patent-intensive Trademark-intensive Copyright-intensive IP-intensive

Jobs in thousands

3,891

Source: ESA calculations using data from the Bureau of Labor Statistics' Industry Productivity program.

Note: Estimates include wage and salary employment, the self-employed, and unpaid family workers. Because several 

industries were found to be trademark-intensive and patent- or copyright-intensive, total employment in IP-intensive 

industries is less than the sum of employment in patent-, trademark-, and copyright-intensive industries.

76 As noted earlier, the employment data cited here were provided by the Bureau of Labor Statistics’ Industry

Productivity program. Employment covers the sum of payroll jobs, self-employed persons, and unpaid family workers

and totaled 144.2 million jobs in 2010. Because the unit of measure is jobs (as opposed to persons) and because about

5 percent of all workers have more than one job, the total number of jobs is greater than the 139.1 million employed

persons in 2010, as estimated from the Current Population Survey (www.bls.gov/cps).
intensive industries was significantly lower. In 2010, patent-intensive industries had 3.9 million

jobs and copyright-intensive industries had 5.1 million jobs. The 24 industries that were

considered intensive with respect to more than one form of IP protection had 4.5 million jobs.77

As can be seen in Figure 2, employment growth over the past two decades has varied

considerably across IP-intensive industries. The figure compares the relative job growth in the

various industry groupings since 1990. Employment in IP-intensive industries in 2010 was

little changed from 1990 as the 12-percent growth in employment during the 1990s was

subsequently reversed during the 2000s. In contrast, non-IP-intensive employment grew in the

1990s and had relatively flat employment in the 2000s.78 As a result, the IP-intensive industries’

share of total employment edged down from 21.7 percent in 1990 to 20.7 percent in 2000 and

declined nearly 2 more percentage points by 2010 to 18.8 percent.

Figure 2. Indexed Employment in IP-Intensive Industries, 1990-2011

Overall employment in IP-intensive industries has lagged other industries over the past two

decades due primarily to historic losses in manufacturing jobs. This decline tracks with other

statistics showing that during the last decade the economy was underinvesting and

underperforming in manufacturing. For much of the 2000s, manufacturing capacity remained

stagnant, and for the first time in decades, manufacturing firms’ real investment in fixed assets

Intellectual Property and the U.S. Economy: Industries in Focus

40

60

80

100

120

140

160

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

1990 = 100

Non-IP-intensive 

IP-intensive 

Trademark-intensive 

Patent-intensive 

Copyright-intensive

Source: ESA calculations using data from the Bureau of Labor Statistics' Industry Productivity program.

Note: Black dotted lines represent ESA projections of 2011 employment growth based on data from the Bureau 

of Labor Statistics' Current Employment Statistics program.

77 The 4.5 million jobs figure can be calculated by subtracting overall IP-intensive employment from the sum of

employment of the trademark-, patent-, and copyright-intensive industries.

78 Non-IP-intensive employment refers to employment in private sector industries not selected as IP-intensive, plus

employment in government and in private households.
Intellectual Property and the U.S. Economy: Industries in Focus

41

stagnated.79 During this same period, the U.S. manufacturing sector lost more than

3 million jobs.80

Over the two decades, shrinking employment in patent-intensive industries was offset by

expansion in the copyright-intensive ones. Patent-intensive industries are a subset of the

manufacturing sector, and its job losses are much like those experienced throughout the nation’s

manufacturing sector. The copyright-intensive industries largely belong to the information and

professional and technical services industry sectors in NAICS, and their employment trends

parallel the trends seen in those sectors: steady growth in the 1990s and offsetting gains and

losses in the 2000s.81 That is, job growth between 2000 and 2010 in professional and technical

services was largely offset by employment declines in the information industries. 

As the economic recovery has unfolded, real business fixed investment in equipment and

software has rebounded, growing by nearly 33 percent from the second quarter of 2009 through

the end of 2011.82 At the same time, manufacturing production surged at a 5.7 percent annual

rate from June 2009 through December 2011, the fastest pace of growth of production in a

decade.83 The resurgence in production led manufacturers to add 346,000 factory jobs in 2010

and 2011, the strongest two-year period of manufacturing job growth since the late 1990s.84

Preliminary employment projections from the Economics and Statistics Administration for

2011 show that as the economic recovery has taken hold, IP-intensive industry employment has

rebounded and contributed disproportionately to overall employment growth. As shown in

Figure 2, job growth was widespread, with a 1.6 percent rise in employment in IP-intensive

industries outpacing the 1.0 percent increase in non-IP-intensive industries. Breaking IPintensive industries out into its constituent parts uncovers 2.4 percent job growth in copyrightintensive industries, 2.3 percent growth in patent-intensive industries, and 1.1 percent growth

in trademark-intensive industries.

79 Data on industrial capacity published by the Federal Reserve Board and data on private fixed investment by industry

from the Bureau of Economic Analysis’ Fixed Assets Accounts Table 3.8ES, as cited in White House 2012, 1 and 7.

The data are available at www.federalreserve.gov/releases/g17/caputl.htm and www.bea.gov/iTable/index_FA.cfm.

80 Data from the Bureau of Labor Statistics’ Current Employment Statistics program, available at www.bls.gov/ces.

81 The copyright-intensive industries from the information sector are newspaper, periodical, book and directory

publishers; software publishers; motion picture and video industries; sound recording industries; radio and television

broadcasting; cable and other subscription programming; and other information services. The copyright-intensive

industries drawn from the professional and technical services sector are specialized design services; computer systems

design and related services; advertising, public relations, and related services; and other professional, scientific, and

technical services.

82 See Bureau of Economic Analysis’ National Income and Product Accounts, Table 1.1.6, available online at

http://www.bea.gov/iTable/index_nipa.cfm.

83 Data on industrial production are published by the Federal Reserve Board, with historical data available at

www.federalreserve.gov/releases/g17/table1_2.htm.

84 Data from the Bureau of Labor Statistics’ Current Employment Statistics program, available at www.bls.gov/ces.
Intellectual Property and the U.S. Economy: Industries in Focus

42

2.2%

16.5%

8.9% 8.8%

0%

4%

8%

12%

16%

20%

Patent-intensive Trademark-intensive Copyright-intensive IP-intensive Non-IP-intensive

7.3%

Source: ESA calculations using data from the Bureau of Labor Statistics' Industry Productivity program.

Note: Estimates show the self-employed and unpaid family workers as a share of all jobs. However, unpaid family 

workers account for only about one percent of the combined total of the self-employed and unpaid family workers 

outside of agriculture. 

In 2010, the self-employed filled 2.4 million jobs in IP-intensive industries. This 8.9 percent

self-employment share was essentially equal to the 8.8 percent share in other (non-IP-intensive)

industries; however, there was notable variation across IP-intensive industries (See Figure 3).

Trademark-intensive industries had the largest number of self-employed persons at 1.7 million

or 7.3 percent of all trademark-intensive jobs. The highest self-employment share, however,

was in the copyright-intensive industries, in which the 0.8 million self-employed workers filled

16.5 percent of all jobs. This high share is not surprising as many jobs in the creative and

performing arts are contract rather than payroll jobs, usually related to the completion or

performance of a specific authored work. 

Figure 3. Self-Employed Share of All Jobs in IP-Intensive Industries, 2010
Intellectual Property and the U.S. Economy: Industries in Focus

43

Total Employment Supported

by IP-Intensive Industries

While IP-intensive industries had 27.1 million jobs either on their payrolls or under contract in

2010, these industries indirectly supported an additional 12.9 million jobs in other (non-IPintensive) industries throughout the economy. In other words, IP-intensive industries

supported 40.0 million jobs (or 27.7 percent of all jobs) directly and indirectly, through a

supply chain that stretches across the economy.85

Figure 4 expands on Figure 1, showing employment in IP-intensive industries (medium blue

bar) plus indirect employment in the supply chain (the rectangle below the blue bar). The

figure also shows the jobs that the patent-, trademark-, and copyright-intensive industries

support in their respective (non-patent-, trademark-, and copyright-intensive) supply chains.

Thus, as shown, patent-intensive industries supported an additional 3.3 million workers

indirectly. Likewise, trademark-intensive industries supported 13.1 million jobs indirectly, and

copyright-intensive industries indirectly via the supply chain supported 2.5 million jobs.

Figure 4. Total Employment Supported by IP-Intensive Industries, 2010

3,252

13,111

2,483

12,910 3,891

22,590

5,100

27,065

0

5,000

Jobs in thousands

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

39,975

7,583

35,701

7,143

Patent-intensive Trademark-intensive Copyright-intensive IP-intensive

Source: ESA calculations using data from the Bureau of Economic Analysis' Industry Accounts office and the Bureau of

Labor Statistics' Industry Productivity program.

Note: Estimates include wage and salary employment, the self-employed, and unpaid family workers.

Total employment 

supported by the 

IP-intensive industries

=

Jobs in patent, 

trademark, copyright, or 

IP-intensive industries

+

Supply-chain jobs 

in other industries

85 These estimates are derived from unpublished input/output tables computed and analyzed by staff from the Bureau of

Economic Analysis’ Industry Accounts office. Data are consistent with the December 2010 annual revision to the

annual input/output tables and are based on the 2009 after-redefinition domestic make and use tables and estimates of

the share of 2010 employment attributable to final demand in IP-intensive industries. Total output requirement tables

were calculated based on the make and use table following the methodology published in mathIO.doc, which are

available at www.bea.gov/industry/zip/cxctr2002detail.zip.
Intellectual Property and the U.S. Economy: Industries in Focus

44

86 In Miller and Blair 1985, these multipliers are referred to as “type I employment multipliers,” while in the Bureau of

Economic Analysis 1997, they are referred to as direct-effect employment multipliers.

87 The 16.2 million jobs in IP-intensive industries directly linked to final demand was found by examining the share of

IP output associated with final demand (excluding imports). We then fed the vector of final demand IP-intensive

employment into a jobs-to-jobs total requirements matrix in several iterations until we accounted for all 27.1 million

jobs in the IP-intensive industries. The first iteration told us that a total of 29.4 million jobs were associated with the

16.2 million final-demand, IP-intensive jobs, giving us the 1.8 multiplier figure we cite. This first iteration, however,

only accounted for about 20 million jobs in IP-intensive industries. Subsequent iterations uncovered the full set of

supply chain jobs in IP-intensive industries as well as the full supply chain in other (non-IP-intensive) industries.

As these data suggest, patent-intensive industries relied more deeply than the trademark- and

copyright-intensive industries on an outside supply chain and indirectly supported a relatively

large number of jobs. Consider that the patent-intensive industries, despite being smaller in

terms of employment than the copyright-intensive ones, supported a larger multiple of outside

supply chain employment. This is because patent-intensive industries come from the

manufacturing sector, which typically has a larger multiplier effect than the service sector, from

which the copyright-intensive industries are drawn.

Additionally, as the “intensive” industry lists become longer, the number of “non-intensive”

industries, which is the source of the indirect, supply chain jobs, becomes shorter. This is why

trademark-intensive industries alone indirectly supported 13.1 million workers, while IPintensive industries as a whole indirectly supported only 12.9 million workers. This is also why

the 60 trademark-intensive industries were more likely to self-supply some of their inputs than

the 26 patent-intensive industries and less likely to rely on outside industries. Put another way,

the potential outside supply chain (indirect jobs) for patent-intensive industries was larger

(covers more industries) than the potential supply chain for the trademark-intensive industries.

These results may appear conservative relative to multiplier analyses often cited in the economic

literature with employment multipliers of about 2. Such multipliers tell us that if growing

demand for final goods and services (as opposed to intermediate inputs to production) spurs

companies to add 100 new jobs, then an additional 100 jobs will be added indirectly throughout

the economy.86 We estimated that for IP-intensive industries this multiplier would be about 1.8,

which is close to the multiplier of 2 found in similar industry analyses. As noted earlier, because

a relatively large number of industries are considered IP-intensive, much of the IP supply chain is

internal to these industries, which reduces the multiplier effect relative to analyses that focus on a

single industry. At the extreme, the jobs-to-jobs multiplier could be calculated for the entire

economy and would be 1 because there would be no external supply chain left. 

In this report, the question that is being addressed differs subtly from the question that can be

answered by a traditional multiplier analysis. Rather than focusing on a hypothetical change in

final demand for IP-intensive goods and services, we were interested in learning which IPintensive jobs were tied to final demand, which were in the supply chain, and how many jobs in

other industries were part of that supply chain. Teasing out these data from the input/output

framework, we estimated that 16.2 million jobs in IP-intensive industries were associated with

producing goods and services to satisfy final demand while 10.9 million jobs in these industries

were associated with production for the supply chain. An additional 12.9 jobs in other (nonIP-intensive industries) also were part of the IP supply chain.87
Intellectual Property and the U.S. Economy: Industries in Focus

45

As is typical with input/output analyses, these data emphasize upstream industries (supply

chain) that provide intermediate inputs needed to produce goods and services in IP-intensive

industries. They do not, however, capture the significant downstream channels that facilitate

the distribution and trade in IP-intensive goods and services. Therefore, the estimate that there

were 40.0 million jobs supported by IP-intensive industries is actually a conservative estimate of

employment linked to these industries.

Value Added

While IP-intensive industries accounted for 18.8 percent of all jobs in the economy in 2010,

their $5.06 trillion in value added in 2010 represented 34.8 percent of total GDP.88 This total

share of GDP has edged down since 2003. Because 60 of the 75 IP-intensive industries were

considered trademark-intensive, it is unsurprising that this segment alone accounted for almost

31 percent of GDP with $4.5 trillion in value added in 2010. (See Figure 5.) Patent-intensive

and copyright-intensive industries accounted for 5.3 and 4.4 percent of GDP, with $763 billion

and $641 billion in value added, respectively.

Figure 5. Value Added and Employment Shares of IP-Intensive Industries, 2010

88 Value added is defined as the difference between an industry’s total output (its sales plus the change in inventories

arising from production) and the value of its intermediate purchases from other industries (that is, from its supply

chain). GDP can be defined as the sum of value added across all industries in the economy. When value added is

summed across all industries, industry sales to and purchases from each other cancel out, and the remainder is industry

sales to final users, or GDP.

30.8%

4.4%

34.8%

65.2%

2.7% 3.5% 5.3%

15.7%

18.8%

81.2%

0%

15%

30%

45%

60%

75%

90%

Share of GDP

Share of GDP

Share of employment

Share of 

employment

Source: ESA calculations using data from the Bureau of Economic Analysis, National Income and Product Accounts 

and the Bureau of Labor Statistics' Industry Productivity program.

Patent-intensive Trademark-intensive Copyright-intensive IP-intensive Non-IP-intensive
Intellectual Property and the U.S. Economy: Industries in Focus

46

89 The data used to examine state employment are from the Bureau of Labor Statistics’ Quarterly Census of

Employment and Wages (QCEW) and measure covered employment. Covered employment refers to jobs covered

by state and Federal unemployment insurance law, and includes practically all civilian wage and salary employment.

These data do not include the self-employed or unpaid family workers. For more information on QCEW,

see www.bls.gov/cew.

110 to 125% of national average (20.76 to 23.60% of jobs)

105 to 109% of national average (20.00 to 20.75% of jobs)

100 to 105% of national average (19.05% to 19.99% of jobs)

Below national average (<19.05% of jobs)

Payroll Employment by State in

IP-Intensive Industries

The IP-intensive share of all covered employment varies notably across states and regions,

as shown in Map 1.89 Four of the top five states in IP-intensive employment share were in

New England: Massachusetts (23.6 percent), New Hampshire (22.0 percent), Connecticut

(21.7 percent), and Vermont (21.6 percent). Wisconsin, with a 23.0 percent share, occupied

second place on the list. Overall there were 16 states above the national average of

19.1 percent. These states were spread throughout the mid-Atlantic, Northeast, and Midwest

and also include California, Colorado, and Utah. 

Map 1. IP-Intensive Industries’ Share of Covered Employment by State,

2010

Source: ESA calculations using data from the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.
Intellectual Property and the U.S. Economy: Industries in Focus

47

Given that 60 of the 75 IP-intensive industries were designated as trademark-intensive, it is not

surprising to find that 15 of the 16 states with above-average shares of IP-intensive jobs also had

above-average shares of trademark-intensive jobs. (See Map 2.) Only Virginia had a high

percentage of IP-intensive jobs, but a below-average share of trademark-intensive employment,

as 14.2 percent of employment in the state was in trademark-intensive industries, below the

national average of 16.2 percent.

Map 2. Trademark-Intensive Industries’ Share of Covered Employment

by State, 2010

Source: ESA calculations using data from the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.

110 to 125% of national average (17.85 to 20.29% of jobs)

105 to 110% of national average (17.04 to 17.84% of jobs)

100 to 105% of national average (16.23% to 17.03% of jobs)

Below national average (<16.23% of jobs)
Intellectual Property and the U.S. Economy: Industries in Focus

48

150 to 176% of national average (4.38 to 5.20% of jobs)

120 to 150% of national average (3.50 to 4.37% of jobs)

100 to 120% of national average (2.92 to 3.49% of jobs)

Below national average (<2.92% of jobs)

As highlighted in Map 3, there were 21 states with patent-intensive employment shares above

the 3.0 percent national average. States from New England and the Midwest had the highest

shares, led by New Hampshire (5.2 percent), Wisconsin (4.9 percent), and Minnesota, Indiana,

and Vermont (4.4 percent each). Essentially all regions of the country had at least one state with

an above-average percentage of employment in patent-intensive industries, including the South

with North Carolina, South Carolina, and Tennessee.

Map 3. Patent-Intensive Industries’ Share of Covered Employment

by State, 2010

Source: ESA calculations using data from the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.
Intellectual Property and the U.S. Economy: Industries in Focus

49

The 13 states with above-average employment shares in copyright-intensive industries were

mostly spread along the East and West coasts, as seen in Map 4. The District of Columbia

(6.4 percent), Virginia (5.9 percent), and New York (4.9 percent) had copyright-intensive

employment shares more than 1.5 times above the national average of 3.3 percent. They were

followed by Washington State, California, and Colorado (4.7 percent each). Utah and

Minnesota were the only other non-coastal states on the list.

Map 4. Copyright-Intensive Industries’ Share of Covered Employment

by State, 2010

Source: ESA calculations using data from the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.

Putting these rankings together, we found six states that had above-average employment shares

for patent-, trademark-, and copyright-intensive industries: California, Connecticut,

Massachusetts, Minnesota, New Jersey, and Utah. These results echo an underlying theme of

this report—intellectual property permeates our entire economy. Industries from a broad range

of economic sectors are IP-intensive, and the jobs they support span all regions of the

United States.

150 to 191% of national average (5.00 to 6.36% of jobs)

125 to 150% of national average (4.16 to 5.00% of jobs)

100 to 125% of national average (3.33% to 4.16% of jobs)

Below national average (<3.33% of jobs)
Average Weekly Wages

Private wage and salary workers in IP-intensive industries had average weekly wages of $1,156

in 2010, or 42 percent higher than workers in non-IP-intensive industries in the private sector.90

(See Figure 6.) This difference was even higher for workers in patent-intensive industries, who

earned $1,407 per week on average, and in copyright-intensive industries, with weekly wages of

$1,440. Workers in trademark-intensive industries earned $1,111 per week, less than their

counterparts in patent-intensive and copyright-intensive industries. This may reflect the fact

that trademark-intensive industries represent a wider range of industries than patent-intensive

and copyright-intensive industries. As was outlined earlier, patent-intensive industries are a

subset of manufacturing industries, while copyright-intensive ones are concentrated in the

information sector and the professional and technical services sector. Workers in

manufacturing, information, and professional and technical services all have relatively high

average weekly wages. 

Figure 6. Average Weekly Wages of Private Wage and Salary Workers

in IP-Intensive Industries, 2010

Intellectual Property and the U.S. Economy: Industries in Focus

50

90 This section focuses on the average weekly earnings of private wage and salary workers using data from the QCEW.

According to QCEW data, there were 24.5 million private wage and salary jobs in IP-intensive industries in 2010.

Wages represent total compensation paid during the calendar year, regardless of when services were performed. Included

in wages are pay for vacation and other paid leave, bonuses, stock options, tips, the cash value of meals and lodging, and

in some states, contributions to deferred compensation plans (such as 401(k) plans).

$0

$400

$800

$1,200

$1,600

$815

Non-IP-intensive

$1,407

Patent-intensive

$1,111

Trademark-intensive

$1,440

Copyright-intensive

Source: ESA calculations using data from the Bureau of Labor Statistics' Quarterly Census of Employment and Wages. 

IP-intensive

$1,156
Intellectual Property and the U.S. Economy: Industries in Focus

51

The premium for working in an IP-intensive industry has grown over time, as shown in Figure

7. In 1990, IP-intensive jobs paid 22 percent more than jobs in other industries and a decade

later this premium had risen to 38 percent. It lost some ground early in the 2000s before

edging back up and reaching a new high of 42 percent in 2010. Trademark-intensive industries

followed a similar but slightly lower upward path over the past two decades. In 1990,

trademark-intensive industries paid 20 percent more on average than non-IP-intensive

industries, with this premium climbing to 31 percent by 2000 and 36 percent in 2010. Wages

in patent-intensive industries started out at a 46 percent premium in 1990, and this premium

grew through the 1990s before surging up to 69 percent by 2000. This surge was reversed in

2001, and the premium changed little in the last decade before rising again over the past few

years. In 2010, patent-intensive workers earned 73 percent more per hour than workers in

non-IP industries.

Copyright-intensive industries followed a more extreme version of the trends outlined above.

Workers in these industries earned 30 percent more than non-IP workers on average in 1990,

and this premium tripled during the following decade to 88 percent in 1999. Over the next

five years, the premium decreased to 64 percent before growing again to 77 percent in 2010. 

Figure 7. Average Weekly Wage Premium of Workers in IP-Intensive

Industries Relative to Non-IP-Intensive Industries, 1990-2010

Source: ESA calculations using data from the Bureau of Labor Statistics' Quarterly Census of Employment and Wages. 

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

IP-intensive

Patent-intensive

Trademark-intensive

Copyright-intensive
Intellectual Property and the U.S. Economy: Industries in Focus

52

91 These estimates are calculated from 2010 Current Population Survey public-use microdata, as accessed through the

Census Bureau’s DataFerrett tool at dataferrett.census.gov. 

Non-IPintensive

9.2%

28.9%

27.7%

21.1%

13.1%

IP-intensive

5.0%

25.2%

27.4%

29.6%

12.8%

Patentintensive

6.4%

28.9%

26.0%

25.6%

13.1%

Trademarkintensive

5.6%

27.4%

28.3%

27.2%

11.6%

0%

20%

40%

60%

80%

100%

Graduate 

degree

Bachelor's 

degree 

Some college 

or associate 

degree 

High school 

diploma 

Less than 

high school 

Source: ESA calculations using Current Population Survey public-use microdata.

Note: Estimates are for employed persons age 25 and over. 

Copyrightintensive

1.7%

13.5%

23.6%

43.1%

18.1%

Educational Attainment

In competitive labor markets, wages are closely correlated to worker productivity, and

educational attainment is a common gauge of workers’ skills and expected productivity. Thus,

it would be expected that employees in IP-intensive industries have relatively high educational

attainment. The data bear that out as 42.4 percent of workers age 25 and older in the IPintensive industries in 2010 had a bachelor’s degree or higher, compared with 34.2 percent in

private non-IP-intensive industries.91 (See Figure 8.) Workers in copyright-intensive industries

were the most educated of the three IP-intensive segments with 61.2 percent having attained a

bachelor’s degree or higher, and only 1.7 percent having less than a high school diploma.

Essentially identical shares of workers in the patent- and trademark-intensive industries (38.7

and 38.8 percent, respectively) had at least a bachelor’s degree.

Figure 8. Distribution of Employed Persons in IP-Intensive Industries

by Educational Attainment, 2010
Intellectual Property and the U.S. Economy: Industries in Focus

53

Foreign Trade

Although trade statistics do not tell us anything about the IP content of exports or imports,

U.S. IP-intensive industries are a major part of U.S. trade. Merchandise exports of IP-intensive

industries totaled $775 billion in 2010, accounting for 60.7 percent of total U.S. merchandise

exports, while merchandise imports of IP-intensive industries stood at $1,336 billion or

69.9 percent of total U.S. merchandise imports. From 2000 to 2010, exports of IP-intensive

industries increased 52.6 percent while imports of IP-intensive industries rose 61.6 percent. 

Manufacturing industries were responsible for almost 99 percent of IP-intensive merchandise

exports in 2010, with oil and gas extraction and software publishing accounting for the rest.

Exports from the semiconductors and electronic parts sector led the way, totaling $64.0 billion

or 8.3 percent of IP-intensive industries’ merchandise exports. (See Figure 9.) The next largest

export categories were basic chemicals ($58.4 billion), motor vehicles ($52.4 billion),

pharmaceuticals and medicine ($49.4 billion), and computer and peripherals ($44.1 billion). 

Figure 9. Merchandise Exports of Selected IP-Intensive Industries, 2010

$25.4

$26.2

$28.0

$34.0

$34.8

$35.7

$36.7

$49.4

$52.4

$58.4

$64.0

$0 $25 $50 $75

Industrial machinery

Other fabricated metal products

Turbine and power transmission equip.

Medical equipment and supplies

Communications equipment

Other general purpose machinery

Other miscellaneous mfg. goods

Resin, rubber, and artificial fibers

Agr., construction, and mining machinery

Electronic instrument

Computer and peripheral equipment

Pharmaceuticals and medicine

Motor vehicles

Basic chemicals

Semiconductor and electronic component

Billions of current dollars

Source: ESA calculations using data from the Census Bureau's Foreign Trade Division.

Note: The selected industries accounted for 74 percent of merchandise exports of IP-intensive industries.

$21.2

$18.2

$43.5

$44.1
Intellectual Property and the U.S. Economy: Industries in Focus

54

92 An estimated 53 percent of U.S. merchandise imports were intermediate products in 2007, according to unpublished

data from Koopman et al. 2010.

93 Linden, Dedrick, and Kraemer 2010.

94 Linden, Dedrick, and Kraemer 2009.

On the imports side, manufacturing accounted for 79 percent of total imports of IP-intensive

industries while oil and gas represented 21 percent and software publishing less than 1 percent.

Among imports of manufactured goods, the largest category was motor vehicles (9.7 percent of

all imports of IP-intensive industries), followed by computers and peripheral equipment

(6.7 percent) and pharmaceuticals and medicines (6.5 percent).

It should be noted that the imports of goods of IP-intensive industries included those produced

by U.S.-owned establishments located overseas and by foreign producers under U.S. licenses. In

2009, Americans received $89.8 billion from royalties and license fees, which included

industrial processes and trademarks, while paying foreigners $25.2 billion. Imports also provide

benefits for American consumers and industries. Imports tend to increase market competition

and thus lower prices, making some products affordable to more American consumers.

Likewise, many imports are intermediate inputs for American industries which make their

finished products more competitive.92

More generally, one must keep in mind that trade statistics do not convey the importance of

IP-intensive products to the U.S. economy. For instance, U.S. electronics companies like Apple

tend to capture a significant portion of the value added in their global supply chain from

products like the iPod and iPhone, two products that are assembled offshore.93 These

companies also tend to capture a large share of the profits from their global supply chains while

retaining market share and an innovative edge globally. At home, these companies employ

many high-skilled workers who earn much more than the low-wage, low-skill workers that

assemble products overseas.94 Trade statistics themselves do not capture this complete picture of

the contribution of these industries to the U.S. economy and its competitiveness. A casual

examination of the trade balance in the IP-intensive electronics-related sectors misses this

nuanced and important reality. 

Data on foreign trade of services are more limited. We used the 2007 Economic Census in

order to get the most detailed accounting of services exports and to calculate total exports of

IP-intensive service-providing industries. Exports of IP-intensive service-providing industries

totaled about $90 billion in 2007, accounting for approximately 19 percent of total U.S. private

services exports. As shown in Figure 10, exports of software publishers, at $22.3 billion, were

the largest group of services exports in 2007, followed by the motion picture and video industry

at $15.3 billion. Other major services export categories in 2007 included financial investment

activities ($12.3 billion, excluding securities and commodity contracts intermediation and

brokerage), scientific research and development ($10 billion), depository credit intermediation

($6.9 billion), and management and technical consulting ($6.3 billion).
Figure 10. Exports of IP-Intensive Service-Providing Industries, 2007

Intellectual Property and the U.S. Economy: Industries in Focus

55

Source: ESA calculations using data from the Census Bureau's 2007 Economic Census. 

$5.9

$1.2

$1.3

$3.0

$5.6

$6.3

$6.9

$10.0

$12.3

$15.3

$22.3

$0 $5 $10 $15 $20 $25

Others

Business support services

Advertising, PR, and related services

Newspaper, book, and directory publishing

Computer systems design and related

Management and technical consulting

Depository credit intermediation

Scientific research and development

Other financial investment activities

Motion picture and video industries

Software publishers

Billions of current dollars
Appendix

Revenue Generated from the

Licensing of Rights to Use Protected

Intellectual Property

Every five years, the Census Bureau conducts an Economic Census of U.S. business

establishments, with the latest conducted in 2007. Data collected include number of

employees, annual payroll, and value of sales by specific product lines. As a robustness measure

of our list of IP-intensive industries, we examined the extent to which industries with high

revenue share from IP-related product lines were among our 75 IP-intensive industries.

Specifically, we identified 91 product codes from the Economic Census that were associated

with licensing, royalties, and other forms of trade of intellectual property.

Examples of such product codes include: 

■ Licensing of rights:

● to use intellectual property (product code 39400)

● to use intellectual property-protected by copyright (39401)

● to use intellectual property-protected as industrial property (39402)

● to use intellectual property-protected by trademark (39403)

● to use intellectual property-protected by patent (39404)

■ Outright sale of:

● original works of intellectual property (39250)

● intellectual property protected by copyright (31500)

■ “Contract production” of various forms of intellectual property (product codes 30150,

31510, 31520, 35113, 35111, 35114, 35115, 35112, 35110, 35540) and “exclusivity”

rights (product code 31256)

Table 11 shows the 31 four-digit NAICS industries that had at least some IP-related revenue,

ranked by the IP share of total revenue in 2007. The distribution of IP-related revenue was

fairly concentrated. Ten industries had IP revenue shares above the 6.6 percent average (among

industries with IP-related revenue), and these industries accounted for about 95 percent of total

revenue from IP-related products. All but one of the ten industries also were identified in this

Intellectual Property and the U.S. Economy: Industries in Focus

56
Intellectual Property and the U.S. Economy: Industries in Focus

57

report as IP-intensive. The sole exception was promoters of performing arts, sports, and similar

events (NAICS 7113). This industry generated 6.2 percent of its revenue in 2007 from a few

IP-related areas, including exclusivity rights; licensing of rights to use property protected by

trademark; licensing of rights to use property protected by copyright; contract production

services for intellectual property protected by copyright, excluding live performing arts; and

contract production services for intellectual property protected by trademark.95

Overall, 14 of the 31 industries with any revenue generated by the protection of IP products

and services in 2007 made it into our IP-intensive industry list. Of the 17 industries that were

not defined as IP-intensive, four were in the broader education sector and four were in the

“other services (except public administration)” sector.

95 See factfinder.census.gov/servlet/IBQTable?_bm=y&-ds_name=EC0771I3&-NAICS2007=7113&-_lang=en.
Table 11. Industries with IP-Related Revenue, Ranked

by IP-Revenue Intensity, 2007

IP-revenue IP-related NAICS IP- intensity revenue

Cumulative

code intensive (IP/total Industry title

($millions) share

revenue)

7115 X Independent artists, writers, 

and performers $9,776 6.8% 76.6%

5331 X Lessors of nonfinancial 

intangible assets 24,473 23.7% 74.3%

5121 X Motion picture and 

video industries 51,132 59.2% 64.1%

5152 X Cable and other subscription 

programming 17,256 71.1% 38.4%

5122 X Sound recording industries 5,290 74.8% 34.8%

7111 X Performing arts companies 3,208 77.0% 23.6%

5112 X Software publishers 12,868 86.0% 9.5%

5417 X Scientific research and 

development services 8,532 91.9% 9.0%

5191 X Other information services 2,812 93.8% 7.5%

7113 Promoters of performing arts, 

sports, and similar events 999 94.5% 6.2%

7112 Spectator sports 1,024 95.2% 3.4%

8139 Professional and similar 

organizations 1,822 96.5% 3.2%

7114 Agents and managers for 

public figures 80 96.5% 1.6%

5511 Management of companies

and enterprises 1,349 97.5% 1.3%

5151 X Radio and television 

broadcasting 628 97.9% 1.1%

6114 Business schools and computer

and management training 107 98.0% 1.1%

5111 X Newspaper, periodical, book,

and directory publishers 883 98.6% 0.6%

5413 Architectural, engineering,

and related services 1,130 99.4% 0.4%

6117 Educational support services 37 99.4% 0.4%

8132 Grantmaking and giving services 258 99.6% 0.3%

8133 Social advocacy organizations 64 99.6% 0.3%

5419 X Other professional, scientific,

and technical services 86 99.7% 0.2%

5179 X Other telecommunications 54 99.7% 0.2%

8134 Civic and social organizations 23 99.7% 0.2%

Intellectual Property and the U.S. Economy: Industries in Focus

58

Above mean +1std. dev.

Above mean
Intellectual Property and the U.S. Economy: Industries in Focus

59

Table 11. Industries with IP-Related Revenue, Ranked

by IP-Revenue Intensity, 2007—Continued

IP-revenue IP-related NAICS IP- intensity revenue

Cumulative

code intensive (IP/total Industry title

($millions) share

revenue)

5415 X Computer systems design and

related services 287 99.9% 0.1%

7121 Museums, historical sites, and

similar institutions 20 100.0% 0.1%

6116 Other schools and instruction 19 100.0% 0.1%

5171 Wired telecommunications 

carriers 19 100.0% 0.0%

5418 X Advertising, public relations,

and related services 16 100.0% 0.0%

5172 Wireless telecommunications 

carriers (except satellite) 4 100.0% 0.0%

6115 Technical and trade schools 3 100.0% 0.0%

Total All industries with 

IP-related revenue 144,259 100.0% 6.6%

Source: ESA calculations using data from the Census Bureau’s 2007 Economic Census.

Note: The intensity measure is the percent of overall revenue generated for each four-digit NAICS industry from the

licensing of intellectual property protected assets.

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