Analytics, Education and Science, Estonia, Financial Services, Technology

38% of R&D expenditure came from the State Budget in 2016. The government has been funding a substantial share of R&D spending and this has remained stable for the past five years. In 2016, compared to 2015, the share of public funds in R&D expenditure decreased. The financing of R&D in Estonia depends to a large extent on the finances granted under the Structural Funds, which are included in the State Budget, and are therefore counted as government allocations. The year 2016 was an interim year – one financing period of the Structural Funds had just ended and the new period had not started yet.

Last year, 52% of R&D expenditure came from the business enterprise sector. Total R&D expenditure in the business enterprise sector was 139 million euros, from which 5% was received from the State Budget. The share of government funding in the R&D expenditure of the business enterprise sector has declined by almost a half over the past five years. In 2016, by economic activity, the share of government funding was the largest in professional, scientific and technical activities, as well as in construction (incl. road construction). 11 million euros of the R&D expenditure of the business enterprise sector originated from foreign sources. Labour costs accounted for 62% of the R&D expenditure of the business enterprise sector. The share of investments in the R&D expenditure was 13%.

In 2016, the decline in the total R&D expenditure came from the non-profit institutional sector (higher education, government and non-profit private sector), where the R&D expenditure declined 20% compared with the previous year. As in the business enterprise sector, labour costs accounted for the greatest share of R&D expenditure also in the non-profit institutional sector (57%). The share of investments was 3%.

The share of R&D expenditure in gross domestic product (GDP) amounted to 1.28% in 2016. According to Eurostat’s preliminary data, with this R&D indicator, Estonia retained its intermediate position among the EU Member States, although Estonia has moved away from the EU average quite a lot over the past four years.

In 2016, the number of persons employed in R&D calculated in full-time equivalents was 5,772, which is 2% more than the year before. The number of researchers and engineers calculated in full-time equivalents was 4,338, which is 3.6% more than in 2015. The increase in the number of full-time researchers and engineers came from the business enterprise sector, where this figure increased 14% compared to 2015. In the non-profit institutional sector, the number of researchers and engineers calculated in full-time equivalents declined by 0.5% over a year. In 2016, females accounted for 45% of the persons employed in R&D, and 41% of researchers and engineers.

For the statistical activity “Research and development”, the main representative of public interest is the Ministry of Education and Research, commissioned by whom Statistics Estonia collects and analyses the data necessary for performing this statistical activity.