This is one of the main conclusions put forward by the European Commission's 2011 Innovation Union Competitiveness Report, which also point out the need for Europe to attract more and "smarter" investment in both public and private research and development. The Report also highlights the need for more cooperation in research within the EU and internationally, as well as a better use of its results and the adaptation of education systems to the requirements in business innovation.

The European Commission's 2011 Innovation Union Competitiveness Report analyses the strengths and weaknesses of the different research and innovation systems put in place in Member states. Its results ans recommendations are based on the Innovation Union Scoreboard, and it also includes a factsheet detailing each country's research and innovation performance.

A few months after the Commission presented its Innovation Union flagship initiative aimed to turn ideas into jobs, green growth and social progress, this Report highlights the need for the European Union to accelerate investment in research and innovation. Although the Union is is slowly advancing towards its target of investing 3% of GDP in research and development, it is still lagging behind the US and Japan in terms of innovation.

In the international scope, the Report also underlines that despite being the first producer of peer-reviewed scientific publications in the world, the rate of growth of Patent Cooperation Treaty (PCT) patent applications in Japan and South Korea is almost double that of the EU. In this respect, the Report shows that further steps are needed to offer more cost-efficient intellectual property protection and management.

One of the main arguments to increase investment in research and innovation lies in its counter-cyclical effect. As highlighted by European Research, Innovation and Science Commissioner Máire Geoghegan-Quinn, putting in practice the Innovation Union flagship Initiative is a key element to achieve the objectives for sustainable growth set up in the Europe 2020 strategy.

“Smarter” investments in innovation

The Report highlights that the most successful innovation performers have focused their investments in a smart specialisation strategy combining policies including public subsidies to higher education, business R&D, venture capital and scientific & technological infrastructures, with actions which include public procurement of innovative products, performance-based standardisation and pro-competitive product market regulations.

It also shows that the development of highly-skilled people needs to be matched with the needs of business and that more innovative and fast-growing SMEs are required. Higher research intensity of high-tech and medium high-tech industries is needs, which means that the EU has to achieve a structural change both within and between sectors. Furthermore, the Report also underlines that the gender gap in science and research must be closed, an element where the European Research Council (ERC) has launched a Plan in order to raise awareness among the scientific community.