Research and development in Estonia is driven by the business sector

Posted on 2 December 2020, 8:00

According to Statistics Estonia, in 2019, the expenditures on research and development (R&D) in Estonia amounted to 453 million euros, which is 24% more than in 2018. The share of R&D expenditures in the gross domestic product was 1.61%, making it the highest share in the last five years.

According to Tiina Pärson, leading analyst at Statistics Estonia, the expenditures on research and development had already shown a significant growth in the two preceding years, but the level reached in 2019 is unprecedented. “More than a half of the R&D expenditures can be attributed to the business enterprise sector where these expenditures increased by 56% year on year. The last time that the business sector spent this much on R&D was in 2011, when there were major investments in the oil industry,” added Pärson.

The biggest amounts on R&D were spent by information and communication enterprises with a total of 100 million euros. They were followed by manufacturing enterprises with 66 million euros, and enterprises engaged in professional, scientific and technical activities with 20 million euros.

In the government sector, R&D expenditures grew by 11% and totalled 46 million euros. There was a decrease in R&D expenditures in the higher education sector and in the private non-profit sector.

In the last three years, the share of investments in R&D expenditures has increased. In 2019, their volume increased by 70% compared to 2018. Investments grew significantly in both the government sector and the business enterprise sector, but showed a decrease in the higher education sector. Labour costs, which account for more than a half of R&D expenditures, grew by 25% compared to 2018, amounting to 241 million euros.

Research and development expenditures by type of expenditure, 2011–2019

37% of the R&D expenditures came from the state budget. The majority of the state budget allocations went to the higher education sector and the government sector. In the business sector, allocations from the state budget accounted for 8% of R&D expenditures.

Nearly a half of the R&D expenditures was spent on experimental development. Basic research accounted for 24% and applied research for 29% of total R&D expenditures. Compared to the preceding years, there was an increase in the share of applied research in nearly all subsectors.

In 2019, the number of employees in R&D in full-time equivalents was 6,448; there were a total of 4,992 researchers and engineers. The share of women has fallen by a few percent both among the entire R&D personnel and among researchers and engineers.

See also the dedicated section on research and development.

More detailed data have been published in the statistical database.


For further information:

Kadri Kütt
Media Relations Manager
Marketing and Dissemination Department
Statistics Estonia
Tel +372 625 9181