Springboard Atlantic

Login

Lost your password?

Spending On Research And Development To Decline To $15.5 Billion In 2015

Businesses in Canada anticipate spending $15.5 billion to perform research and development (R&D) in 2015, down 2.6% from 2014 intentions of $15.9 billion and 3.6% lower than the actual expenditures of $16.0 billion in 2013, according to a new report from Statistics Canada.

Businesses perform R&D to create and commercialize new technology, products and processes. Industrial R&D is composed of two categories: current and capital R&D spending. Current R&D spending of $14.2 billion is expected to account for 92% of industrial R&D spending in 2015.

Wages and salaries are projected to total $9.6 billion in 2015 and will constitute the largest component of current R&D expenditures. The remaining current costs, such as the purchase of non-capital materials, contracts for on-site consultants and products to support R&D are forecast to be $4.6 billion.

Spending on R&D capital, such as machinery, equipment, land and buildings, is anticipated to be $1.3 billion, accounting for 8% of total industrial R&D spending in 2015.

Research and development spending intentions by industry, 2015

The manufacturing sector is anticipated to spend $6.4 billion in 2015, or 42% of all industrial R&D. Manufacturing R&D performance remains well below its 2001 peak of $9.2 billion.

Service industries are anticipated to spend $7.3 billion or almost half (47%) of all industrial R&D in 2015. The most recent peak in R&D spending in service industries was $7.6 billion in 2011. R&D performance in the service industries has stabilized since then.

R&D spending in mining, quarrying and oil and gas extraction is anticipated to be $1.4 billion in 2015, down $246 million from its most recent peak of $1.6 billion in 2012.

The agriculture, forestry, fishing and hunting; utilities; and construction sectors will perform the remaining $380 million of industrial R&D.

Characteristics of industrial research and development performance, 2013

In 2013, the most recent year for which these R&D characteristics data are available, companies performing R&D funded $12.8 billion or 80% of total industrial R&D ($16.0 billion).

Foreign sources were the second-largest source of funds for industrial R&D in 2013 at $1.7 billion or 11%. The remaining $1.5 billion of industrial R&D funding came from governments, private non-profit organizations as well as other companies and organizations.

Canadian-controlled businesses performed $10.1 billion or 63% of industrial R&D in 2013, while foreign-controlled businesses performed $5.9 billion or 37%.

American-controlled businesses performed $3.6 billion or 62% of the R&D performed by foreign-controlled businesses in Canada in 2013.

Energy-related research and development

Businesses in Canada spent $2.0 billion on energy-related R&D in 2013, unchanged from 2012.

Fossil fuel-related R&D performance accounted for over two-thirds of all energy-related R&D in 2013 at $1.4 billion, down slightly from $1.5 billion in 2012.

R&D for energy efficiency-related technologies reached $128 million in 2013, up from $80 million in 2012.

Industrial research and development performance in engineering and technology

The top four fields of engineering and technology accounted for two-thirds of all industrial R&D in Canada in 2013: electrical engineering, electronic engineering and information technology ($3.5 billion); other engineering and technology ($2.7 billion); software engineering ($2.6 billion) and mechanical engineering ($2.0 billion).

R&D spending in emerging technologies, such as biotechnology and nanotechnology, was $404 million or 3% of industrial R&D in 2013.

Medical biotechnology R&D spending totalled $295 million and accounted for three-quarters (76%) of the $386 million performed by businesses on biotechnology-related R&D in 2013.

Nanotechnology-related R&D spending was $18 million in 2013, up from $14 million the previous year.

Industrial research and development personnel

Most industrial R&D is performed by scientists and engineers, who are assisted by technical and support staff. There were 89,165 full-time equivalent scientists, engineers and R&D administrators in 2013, accounting for two-thirds (67%) of industrial R&D personnel.

Technicians and technologists—technically trained personnel who support the activities of scientists and engineers—accounted for 33,551 full-time equivalents, while other support personnel constituted the remaining 9,615 full-time equivalents.

Overview of industrial research and development spending by province

Ontario and Quebec continued to account for the majority of the $16.0 billion of industrial R&D performed in Canada in 2013. Spending on industrial R&D declined 7.0% to $7.0 billion in Ontario and edged down 0.6% to $4.7 billion in Quebec.

In 2013, 97% of R&D performance in Ontario was distributed between services ($3.5 billion) and manufacturing ($3.3 billion).

In Quebec, 95% of industrial R&D spending was performed by manufacturers ($2.6 billion) or by businesses in service industries ($1.8 billion).

About $2.0 billion worth of industrial R&D was performed in Alberta in 2013, primarily by mining, quarrying and oil and gas extraction ($1.1 billion) and in service industries ($687 million).

Service industries performed over half (61% or $993 million) of the $1.6 billion spent on industrial R&D in British Columbia in 2013.

Among the remaining provinces, $283 million was spent on industrial R&D in Saskatchewan in 2013, with mining, quarrying and oil and gas extraction performing $113 million and service industries $103 million. Industrial R&D performed in Manitoba totalled $232 million, led by service industries at $154 million, followed by manufacturers ($73 million).

In Atlantic Canada, businesses performed $222 million in industrial R&D, down 18.7% from 2012. Newfoundland and Labrador led in industrial R&D performance spending with $81 million, followed by New Brunswick ($60 million), Nova Scotia ($60 million) and Prince Edward Island ($20 million).