Each franc invested in the ETH Domain generates more than five times its value in Switzerland, and each job creates another five jobs. This is the result of a study that has just been published. This demonstrates that the ETH Domain is an important actor in the Swiss national economy. With the education of specialists, its top-level research and close cooperation with business and the authorities, it makes a vital contribution towards Switzerland’s competitiveness and the quality of life in this country.
With its approx. 21,000 employees, 30,000 students and doctoral students and a budget of CHF 3.5bn, the ETH Domain contributes considerable amounts to Switzerland’s economy and society, be it on account of the education of specialists, investments in research infrastructures, cooperation with SMEs and industry or through the establishment of spin-offs. The independent consultancy firm BiGGAR Economics from the UK has calculated these amounts for 2016. According to its report, the ETH Domain generated a gross value added of CHF 13.3bn on the basis of federal funding amounting to CHF 2.5bn in 2016. Thus each franc invested in the ETH Domain generates a gross value added of CHF 5.40 in Switzerland. Furthermore, 21,000 employees bring about another 98,000 jobs, which means that each job in the ETH Domain creates another five jobs in Switzerland. It is estimated that worldwide, the ETH Domain generated a gross value added of CHF 16.5bn and created 123,800 jobs.
However, the ETH Domain also provides many services which are difficult to quantify. In particular, this concerns the field of public goods, i.e. air, water and soil. Thus research conducted in the ETH Domain contributes to the reduction of air pollution, to better water quality and the avoidance of damage caused by natural hazards; the Swiss Seismological Service and the avalanche bulletin are cases in point. Also, the ETH Domain makes a crucial contribution to Switzerland’s good reputation in other countries and to the fact that Switzerland occupies a top position with regard to innovation and competitiveness.
23,000 jobs thanks to spin-offs from the ETH Domain
The services that the ETH Domain provides and the value added that it creates for Switzerland are diverse. Thus foreign companies settle in its environment in order to profit from specialists and from cooperation with the institutions of the ETH Domain. Prominent examples include Google and Disney in Zurich, as well as Intel and Texas Instruments in Lausanne. These companies create numerous jobs with a high degree of value creation in Switzerland. Thus more than 2,000 people are now working for Google in Zurich; in the future, the workforce is expected to rise to 5,000.
The institutions of the ETH Domain also create jobs themselves. Every week, a spin-off emerges from the ETH Domain. In this way, state-of-the-art products and technologies find their way from research to the market. One out of seven new highly innovative enterprises in Switzerland is a spin-off from the ETH Domain. These companies are funded by more than half of the venture capital in Switzerland. The BiGGAR study estimates the gross value added by the spin-offs from the ETH Domain at CHF 2.2bn and 22,900 jobs.
The backgrounds of the study
In spring 2017, the ETH Board invited BiGGAR Economics to assess the ETH Domain’s contribution to the Swiss economy and worldwide for 2016. BiGGAR is an independent consultancy company in the UK and specialises in studies of the economic contributions made by universities. Its methodology is internationally established and broadly based. BiGGAR calculated the direct demand of the institutions of the ETH Domain, on the one hand, and the indirect increase in service and competitiveness, on the other hand. The former includes the demand of staff and students, as well as investments in buildings and research infrastructures. The latter includes the additional income which ETH graduates earn in the course of their professional lives in comparison with graduates of a university of applied science, the transfer of knowledge and the commercialisation of research results. BiGGAR has already produced similar studies about more than 50 European universities, among them the University of Oxford and the 23 universities of the League of European Research Universities (LERU). The study on the economic contribution of the ETH Domain, as well as a short version, can be found here.