Research and development of Canadian private non-profit organizations, 2019 (actual), 2020 (preliminary) and 2021 (intentions)
Archived Content
Information identified as archived is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please "contact us" to request a format other than those available.
Released: 2021-06-04
Research and development spending intentions, 2020 and 2021
Private non-profit organizations in Canada indicated their intentions to spend less on in-house and outsourced research and development (R&D) activities in 2021 (down to $141 million and $470 million, respectively). This follows similar declines reported in the preliminary estimates of in-house and outsourced R&D spending in 2020 (declining to $145 million and $534 million, respectively).
The data in this release were gathered during the COVID-19 pandemic, which has profoundly disrupted the Canadian economy. Despite this, most organizations in the private non-profit sector that engage in R&D activities (85.2%) indicated that they did not intend to make significant changes in the amount of their spending on R&D in 2020.
Research and development activities in 2019
Spending on in-house R&D activities by private non-profit organizations in Canada increased from $171 million in 2018 to $183 million in 2019. The growth in spending coincided with a rise in Canada's gross domestic product (GDP) for the community non-profit sector. As a result, the intensity ratio of total in-house R&D expenditures as a share of GDP remained at 0.6%, the 2018 level.
Chart 1
Intensity ratio of total in-house research and development expenditures to gross domestic product for the community non-profit sector
Current in-house R&D expenditures, which accounted for the vast majority of R&D expenditures, increased 6.7% to $176 million in 2019. Wages and salaries, which accounted for more than half of all current in-house expenditures (59.7%), rose 12.9% to $105 million.
Total capital in-house R&D expenditures increased 16.7% to $7 million in 2019.
In-house research and development personnel increases in 2019
Private non-profit organizations employed 1,308 full-time equivalent (FTE) in-house R&D personnel in 2019, an increase of 5.1% over 2018 levels. This growth is attributable to an increase in the number of R&D technicians, technologists and research assistants, which rose from 361 FTEs in 2018 to 465 FTEs in 2019. The number of researchers and research managers (552 FTEs) and on-site R&D consultants and contractors (76 FTEs) employed in 2019 decreased slightly from 2018.
Fields of research and development: In-house research and development spending largely targets medical and health sciences
R&D expenditures by private non-profit organizations are broken down into two broad science categories—natural sciences and engineering; and social sciences, humanities and the arts.
In 2019, organizations spent more than three-quarters ($151 million) of all in-house R&D expenditures on natural sciences and engineering, of which $91 million (60.3%) was concentrated on R&D activities related to medical and health sciences. Of particular note, the share of expenditures in medical and health sciences has trended downwards since 2014, when they accounted for 82.4% of total expenditures.
R&D expenditures in social sciences and humanities increased 6.5% to $33 million in 2019.
Chart 2
In-house research and development (R&D) expenditures, by field of R&D
In-house research and development activities concentrated in Ontario
R&D spending in Ontario increased from $123 million in 2018 to $131 million in 2019. The province has had the highest share of R&D spending since 2014. British Columbia was a distant second, at $15 million.
Government remains the largest source of funds for in-house research and development
Funding from provincial, territorial and federal levels of government continued to account for the majority of funds to private non-profit organizations in 2019. Provincial and territorial grants ($59 million) were the largest source of funds reported, followed by federal government grants, at $34 million.
Private non-profit organizations also saw a notable increase in R&D funding in 2019 through other Canadian funds, which rose 41.7% to $34 million, and through direct self-funding, which increased 20.0% to $30 million.
Expenditures for research and development focus on applied research
In 2019, more than half of all R&D expenditures were spent on applied research ($110 million), as opposed to basic research or experimental development. Private non-profit organizations spent $53 million on basic research and $21 million on experimental development. This breakdown of core types of R&D spending is consistent with previous years.
Chart 3
In-house research and development (R&D) expenditures, by nature of R&D
Outsourcing of research and development remains stable in 2019
In addition to in-house spending, private non-profit organizations also outsource R&D to other organizations through contracts and grants. Outsourcing is often used to minimize costs and gain access to various technologies and expertise. In 2019, the amount of outsourced R&D increased 2.6% to $560 million.
Much like the previous year, most outsourced R&D funds were sent to other sectors in Canada, particularly hospitals and the higher education sector. Hospitals received $307 million in funding, while universities received $163 million.
Payments made to organizations outside Canada for outsourced R&D activities decreased from $21 million in 2018 to $14 million in 2019. Foreign universities, which receive the majority of international spending, received less than in the previous year, down from $17 million in 2018 to $12 million in 2019.
Chart 4
Expenditures for outsourced research and development, by sector and location, 2019
Outcomes of research and development
From 2017 to 2019, expenditures for both in-house and outsourced R&D led to new or significant improvements for 70.2% of private non-profit organizations. Most of the organizations (65.1%) reported that their investments resulted in improvements in services, including ongoing knowledge transfer to physicians, first responders, patients and the general public. Other reported improvements were related to the procurement of goods, methods, logistics and supporting activities.
Note to readers
Private non-profit organizations provide services to households either without charge or at prices that are not economically significant. For purposes of measuring research and development (R&D) performance, private non-profit organizations include voluntary health organizations, private philanthropic foundations and private research institutes.
The private non-profit sector is residual in nature. Private non-profit organizations that are controlled and financed by government (at least 50%) or affiliated with higher education institutions are excluded from the survey population. R&D expenditures for these excluded private non-profit organizations are included in the R&D expenditures for the government and higher education sectors. Control over private non-profit organizations may change over time, causing volatility within the sector's population.
Contact information
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).
- Date modified: