Gothenburg driving Swedish growth via high R&D intensity

Lindholmen in Gothenburg
Gothenburg is a prominent hub for Swedish R&D and is an innovation leader in Europe, according to the European Commission.

Gothenburg maintains its position as a prominent driver of Swedish innovation. Businesses in Gothenburg’s county continue to invest more in R&D than those in the Stockholm County, despite the Swedish capital being twice the size in terms of population and employment in the private sector. The R&D intensity in Gothenburg’s county is also twice as much as the rest of Sweden, shows a new report from Business Region Göteborg. 

The report, Business R&D in West Sweden 2022, shows that businesses in Västra Götaland, Gothenburg’s county, account for 34 per cent of the business R&D expenditure in Sweden. In total, companies in the county invested SEK 44.5 billion in R&D during 2021. This is SEK 1 billion more than companies in the Stockholm County. 

In terms of value-added, the difference is considerable. In Gothenburg’s county, the business R&D expenditure is 5.2 per cent of the gross regional product (GRP) – which is twice as much as for Sweden as a whole (2.5 per cent of GDP) and for the Stockholm County (2.6 per cent of GRP). The same pattern is evident when we look at business R&D expenditure in relation to the number of employees in the private sector.   

“That our business R&D expenditure is the highest in the country mirrors the strength our companies have in developing competitive products, services and processes for the global market. It also illustrates companies’ willingness and capacity to increase the knowledge content in each step up to the customer's final delivery,” says Patrik Andersson, CEO at Business Region Göteborg.

Large global companies including the Volvo Group, Volvo Cars, SKF, AstraZeneca, Preem, Essity, Ericsson, Stena and CEVT accounted for a majority of Gothenburg county’s business R&D expenditure.  

“The investments of these large companies open doors and create opportunities for other parts of the business community. The surge we have seen in tech in recent years in many ways is connected to the R&D investments of large companies in the region. When it comes to deep tech, Gothenburg has started to attract a lot of interest,” says Patrik Andersson.   

The massive investments that have been announced during 2022, such as Volvo Cars and Northvolt’s new battery production plant and R&D centre and Heart Aerospace’s expansion, as well as initiatives within Gothenburg Green City Zone, Transzero Initiative or GoCo Health Innovation City are not included in the data as yet.   

“We can see that companies in our region invest more of their profits in their future competitiveness than in other parts of Sweden. They are investments in sustainable products and services, often developed in collaboration with academia and other actors in the West Swedish ecosystem,” says Maria Strömberg, director of Clusters and Innovation at Business Region Göteborg and co-author of the report.

Gothenburg stands out

Sweden had a total annual R&D expenditure (private, public and academia) of SEK 183 billion. The Stockholm County is the biggest contributor (SEK 59 billion), thanks to it having more universities and public agencies and institutions. Gothenburg’s county was not far behind (SEK 53 billion).  

When we look at total R&D expenditure in relation to the number of employees, the R&D intensity in Gothenburg’s county is 34 per cent higher than in the Stockholm County, and 69 per cent higher than the national average. 

Why is Gothenburg developing so strongly? 

“We get a good picture of what has happened during the past decade if we look at employment within knowledge-intensive business services, which has increased compared with employment within manufacturing. Gothenburg has transformed from an industrial city to an engineers’ epicentre, where knowledge-intensive business services in symbiosis with our base industry is driving growth in the region. This is not the case in the rest of Sweden,” says Peter Warda, senior analyst and co-author of the report.  

With the transition that industry in Gothenburg is going through, this trend will continue explains Peter. Not least within electromobility and autonomous systems where Gothenburg has developed into a progressive leader with global recognition.

“The high R&D share is a reflection of the fact that these types of jobs are created here. We see a strong growing demand for IT and technology graduates, and preferably a combination of these two. This is strongly linked to our advanced export industry,” says Peter Warda. 

Access the report: Business R&D in West Sweden

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