Industrial R&D spending creeps up: StatsCan

Increases to 0.9% over 2011 to $15.5 billion, but still below 2007 peak.

October 3, 2012

OTTAWA—Canadian businesses are anticipating expenditures of $15.5 billion on industrial research and development (R&D) in 2012, edging up 0.9% from 2011, according to Statistics Canada.

Still, R&D spending remains below its 2007 peak of $16.8 billion.

The statistics agency says the recovery is being driven by growth in the manufacturing sector, up by $228 million (3.1%) to $7.6 billion. Within the manufacturing sector, communications equipment intends to invest $1.5 billion, up $129 million from 2011.

Overall, businesses in the services sector anticipate spending slightly less at $6.8 billion this year than in 2011 (down 0.2% or $12 million), with most of the decline occurring in scientific research and development services (down $22 million or 1.3%).

Respondents to a survey said 61% of total spending will be concentrated in the wages and salaries for R&D personnel, a level last seen in 2009 (60%).

Businesses are also suggesting they will dedicate 5% of their total industrial R&D expenditures to purchase land, buildings and equipment. The most recent peak in the importance of capital expenditures to total industrial R&D spending occurred in 2001 at 11%. Since 2009, this ratio has been under 6%.

In 2010, industrial R&D spending continued predominately in Ontario ($6.8 billion) and Quebec ($4.7 billion). R&D spending in Quebec edged up 0.5% from 2009, while spending in Ontario declined by 4.2%. All other provinces except Manitoba (1.4%) saw decreases in industrial R&D spending from 2009.