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Published: 17.02.2005, 06:00
Modified: 17.02.2005, 09:02
Genetic technology generates jobs–KOF confirms a forecast it made in 1996.
More jobs

Over the past ten years developments in biotechnology and genetic technology have led to the creation of a considerable number of jobs. This is the conclusion reached by the Swiss Institute for Business Cycle Research (KOF) (1) at ETH Zurich following a query from ETH Life. The conclusion accords with a forecast for 2005, which KOF published at a time when Switzerland was preparing to vote on the Genetic Protection Initiative.

By Michael Breu

One argument that is always trotted out when a ballot is in the offing is the effect the result will have on the employment market. It was also present in the public debate seven years ago, in the period leading up to the Genetic Protection Initiative. "What is to be gained by investing billions in the USA?“, asked the Genetic Protection Paper in August 1997 and claimed: "For the moment genetic technology is a huge money-eating machine“. Alone in the USA Swiss pharmaceutical industry had invested 10 billion dollars in genetic technology–without any great expectations of return. The same applied to the situation on Switzerland's job market. "A study estimates 4000 new jobs each year for Switzerland alone […] The genetic technology industry in the USA is 30 times greater than Switzerland's today. To date it has grown by 10,000 jobs each year. Applied to Switzerland this would mean an increase of just 350-400 more jobs," wrote the historian Günter Spaar. In the "alternative", left-leaning weekly WochenZeitung (WoZ) in December 1997 he was even more explicit and wrote emphatically: "Genetic technology doesn't generate jobs." Spaar's conclusion was based on a study that he had carried out for the activist group Basler Appell against Genetic Technology and which had been published in September 1996 under the title of "The New Eldorado?" (Das neue Eldorado?) (2).

Profitable business

Around this time, Interpharma–the industry's representative association, comprising Hoffmann-La Roche, Novartis (still Ciba and Sandoz at the time), Serono, Actelion and Vifor–commissioned an economic forecast. In June 1994 the Swiss Institute for Business Cycle Research (KOF) at ETH Zurich (KOF) was charged with the project and the results were presented in August 1996 (3). KOF's forecast for genetic technology was far more favourable than Spaar's: For 2005 the experts estimated an increase in the total production of bio- and genetic technological products to around two per cent with a corresponding increase in jobs of around 1.4 per cent. "In absolute terms in 2005 the effect within the economy as a whole is about 17,000 (from genetic technology in the chemical industry in Basle alone) or 42,000 people respectively (genetic technology over the whole of the chemical industries)," predicted Bernd Schips and Spyros Arvanitis in their report.

Indeed, in the intervening years biotechnology and genetic technology have become big business. "Scientists are celebrating and shares on the stock exchange are climbing out of the doldrums–biotechnology lends upwind to optimism“, reported Technology Review in September 2003. The branch had developed strongly, above all in the USA. David Baltimore, Nobel laureate in Medicine, Member of the Board of Directors for the investors group BB Biotech in Küsnacht and President of the California Institute of Technology speaks of a "steep growth curve".

Rice plants in the lab: Genetic technology is widely used today in plant research. Picture: genfakten.ethz.ch large


continuemehr

Product from the branch of bio-technology: Gene chips used to characterise the activities of genes. large

Following a query from ETH Life KOF has undertaken an estimation of the current situation in Switzerland's biotech industry. The increase in the number of workers in the pharmaceutical industry from 20,000 in 1995 to 28,000 in 2001 confirms the predicted growth tendency in the branch–especially in view of the fact that the number of workers declined in other areas of industry over the same period.

No biotechnology: more unemployment

Spyros Arvanitis sums up: "Without biotechnology we would have seen a decline in jobs in the pharmaceutical industry." Exactly how big the increase in the number of employed has been in absolute numbers is something that the chemical scientist and economist cannot tell. "We can't go out with a clipboard and count every single worker,“ he says and points out that in addition to the pharmaceutical industry in Switzerland, suppliers of laboratory equipment, diagnostic machines and special products had also grown in recent years, making an exact tally of the number of jobs extremely difficult. Arvanitis, however, estimates that the greater part of the growth in the pharmaceutical industry had been generated in the areas of bio- and genetic technology.

Further studies also confirm the assessment of KOF's experts. In its August 2004 edition of "Spotlight" (4) Credit Suisse estimates the number of jobs in the biotech industry in a strict sense (without the multis) to be 8000, andthe 11th European biotechnology report (5) from the professional services firm Ernst & Young, published in May 2004 puts the number at 13,000 (also excluding the multis). Excellent perspectives for the industry, considers Spyros Arvanitis from KOF. "And the potential has not yet been fully exploited, not by a long way."

Overcoming latent hostility to technology

In what measure Switzerland as a centre of research can profit from the industry is still an open question. For Jürg Zürcher from Ernst & Young the chances are good, because "Switzerland's biotech industry is in an excellent position in the European context." ETH scientist Spyros Arvanitis sees great potential above all for the chain of suppliers. He does not see any chance for green genetic technology. Thomas Veraguth from Credit Suisse also foresees "favourable conditions" for growth. "Biotechnology companies in Switzerland can draw from a pool of highly-qualified workers. In addition they can count on a well-developed infrastructure and economic framework conditions that are relatively business friendly." Just as KOF researcher Arvanitis, Veraguth is not optimistic with regard to green genetic technology and believes that Switzerland missed a "big opportunity" in this area. According to the financial expert Veraguth Switzerland would do well to overcome its "latent hostility to technology."


Footnotes:
(1) Swiss Institute for Business Cycle Research at ETH Zurich (KOF): www.kof.ethz.ch/
(2) Günter Spaar: "Das neue Eldorado? Die wirtschaftliche Bedeutung der Gentechnologie“, Basler Appell gegen Gentechnologie, September 1996: www.baslerappell.ch/
(3) Spyros Arvanitis, Bernd Schips: "Lage und Perspektiven der Gentechnologie in der Schweiz. Eine ökonomische Analyse anhand von Firmendaten“, KOF Zürich, August 1996
(4) Thomas Veraguth: "Spotlight. Technologiestandort Schweiz: Zukunft der Biotechnologie“, Credit Suisse, August 2004: https://entry4.credit-suisse.ch/csfs/research/p/d/de/publikationen/media/pdf/spo_0409_biotechnologie_de.pdf
(5) 11th European biotechnology report from Ernst & Young. Press release of 13th May 2004: www2.eycom.ch/media/mediareleases/releases/20040513/de.aspx



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