The Netherlands told to train more scientists and spend more on research

Science and Technology Commissioner Janez Potočnik

This was the assessment of the Science and Technology Commissioner Janez Potočnik, speaking at the Innovation 2008: Onshoring of R&D Activities conference, at the Hague last week.

Knowledge and innovation are acknowledged as the main engines of labour productivity and structural economic growth. But the Netherland’s overall R&D intensity, a measure which compares overall expenditure on R&D to gross domestic product, is lower than the EU-27 average, at 1.67 versus 1.84 in 2006. What’s more, it is declining, from 1.82 in 2000, to 1.67 in 2006.

Meanwhile the share of R&D financed by business in the Netherlands, at 51.1 percent in 2003, trails the EU-27 average, which itself is not very impressive.

“So, the Netherlands is faced with a challenge of increasing R&D in its business sector, which is of particular importance for innovation,” Potocnik told delegates.

He added that, “Foreign R&D-related investment can help raise the Netherlands’ business and overall R&D intensity. But it can also generate knowledge spill-overs and efficiency effects.”

However, in the Netherlands a scant 30 percent of corporate R&D expenditure comes from foreign-owned companies, In Ireland, by comparison the figure is 70 percent, in Hungary, 60 percent; in Belgium, 50 percent.

So what factors determine the attractiveness of a particular country as a place to carry out business R&D? According to Portocnik the top five R&D location criteria are: the presence of profitable or innovation-friendly markets; the availability of qualified people; International accessibility; world class institutes and universities; and good cooperation with knowledge institutions and companies

As far as the availability of qualified people is concerned, the Netherlands’ performance is below average. “You do not have enough researchers,” said Potocnik. In 2006, the Netherlands had 4.8 researchers per 1,000 members of its labour force, compared to the EU-27 average of 5.5.

A major factor is the low number female researchers. Surprisingly for such an egalitarian country, the Netherlands’ standing on this metric is the worst in Europe.  In 2006, only 18 percent of researchers in the Netherlands were women, compared to the EU-27 average of nearly 30 percent.

And, said Potocnik, “Not only are there not enough women researchers, it seems that the future supply of all researchers, both men and women is by no means certain, because there are a relatively low number of science and engineering graduates waiting in the wings.”

In 2004, 23 percent of graduates in the EU-27 qualified in science and engineering, compared to 16.5 percent in the Netherlands. On average, 31.2 percent of EU-27 tertiary education graduates in science and engineering were women. In the Netherlands this percentage was much lower at 19.5 percent.

Potocnik found some silver linings among these clouds noting that the Netherlands has world class institutes and universities, “which continue to perform excellently.”

The country has also made a good showing under the first two calls for the European Research Council, ending up in 4th place in the Starting Grants scheme, while in the Advanced Grants Call over 6 percent of the successful applications have gone to Dutch host institutions, and 18 Dutch nationals have been selected for funding among the top 256 proposals.

However, said Potocnik, the Netherlands needs to ask itself how much of the current excellent scientific performance is the result of past investments in research and human capital.

“Is there no risk that today’s relatively low and declining investment in research combined with an insufficient inflow of new, especially female, researchers - which itself is to an important extent determined by the investment in research - poses a threat to sustaining economic performance and prosperity?”

The policy lessons to be drawn from this are self-evident but worth stating,” Potocnik concluded. “To put it bluntly, if you want to ensure future labour productivity and structural economic growth and attract more foreign R&D-related investment, you have to spend more on research and get more people into research careers.”

Only by doing this will the Netherlands safeguard its supply of highly qualified people and the quality of its knowledge institutions.