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Spending on research and development, 2015 (final), 2016 (preliminary) and 2017 (intentions)

Released: 2018-01-30

Spending on research and development (intentions)

32.8 billion

2017

0.5% increase

(year-over-year change)

Canada's gross domestic expenditures on research and development (GERD) intentions rose 0.5% to $32.8 billion in 2017, following declines in 2015 (-3.8%) and in 2016 (-0.8%).

Business enterprises led the decline in 2015 research and development expenditures

In 2015 business enterprise research and development (R&D) spending fell by more than $1.0 billion from 2014 expenditures, primarily the result of declines in services-producing and oil and gas extraction industries. The business enterprise sector reported a 3.1% spending decrease on R&D for 2016, with minimal change anticipated for 2017.

Research and development funding and performing expenditures by sector

The business enterprise sector has led all other sectors since 1985 in both the funding and performing expenditures of total national R&D. The business enterprise sector has historically performed more R&D than it funds. In 2015, business enterprises performed 52% of GERD activities ($17.2 billion) while funding 42% of activities ($13.7 billion). The higher education sector and provincial research organizations also typically perform more R&D activity than they fund. Conversely, the government sector and private non-profit institutions generally fund more R&D than they perform.

The higher education sector has been the second-largest R&D performer in Canada for 30 years, representing 40% of GERD in 2015. Higher education sector R&D performing expenditures rose 2.8% from 2014 to 2015, to $13.3 billion. With respect to R&D funding, the higher education sector was the third-largest R&D funding contributor in Canada until 2012, when it became the second largest. Higher education R&D funding was up 4.2% to $6.7 billion in 2015, with additional increases in 2016 and 2017 anticipated to reach $6.8 billion.

The federal government remains the third-largest R&D performing sector, with $2.0 billion intramural R&D expenditures reported for 2015, down 22.2% from $2.6 billion in 2014. Planned spending for 2016 was up 6.9% to $2.2 billion, followed by an anticipated 4.7% decline to $2.1 billion in 2017. Since 2012, the federal government has also been the third largest funder of R&D activities in Canada. Federal government R&D funding was $5.6 billion for 2015 and $5.8 billion for 2016, with preliminary estimates showing a 0.4% decline to $5.7 billion for 2017.

Chart 1  Chart 1: Distribution of gross domestic expenditures on research and development, by performing sector, 2015 (final), 2016 (preliminary) and 2017 (intentions)
Distribution of gross domestic expenditures on research and development, by performing sector, 2015 (final), 2016 (preliminary) and 2017 (intentions)

Chart 2  Chart 2: Distribution of gross domestic expenditures on research and development, by funding sector, 2015 (final), 2016 (preliminary) and 2017 (intentions)
Distribution of gross domestic expenditures on research and development, by funding sector, 2015 (final), 2016 (preliminary) and 2017 (intentions)

Research and development spending by science type

Total R&D expenditures are grouped into two fields of science: natural sciences (consisting of natural sciences and engineering) and social sciences (consisting of the social sciences, humanities and the arts). While total R&D spending is primarily concentrated in the natural sciences, the social sciences comprised 11% of GERD in 2015 and 2016, a record share which is expected to persist in 2017.

The higher education sector has historically been the largest contributor to social science R&D performing expenditures, ranging from 85% of total social science R&D performing expenditures in 1985 to a peak of 92% in 2004. In 2015, 90% of all social science R&D performing expenditures occurred in the higher education sector. Funding for social science R&D is also concentrated in the higher education sector, which encompassed 61% of total social science expenditures in 2015. The federal government was the next largest funder at 22%.

Research and development spending by geography

Ontario continues to contain the most R&D activity in Canada. In 2015, R&D expenditures fell 4.7% from the previous year, accounting for 44% ($14.4 billion) of total R&D spending in Canada. R&D spending in Quebec declined 6.3% to $8.5 billion, representing 26% of the national total. British Columbia and Alberta, which have taken turns in the third spot nationally since 1992, each represented 11% of total GERD in 2015, collectively undertaking $7 billion of R&D spending.

International research and development intensity indicator

The Organisation for Economic Co-operation and Development (OECD) publishes member nation GERD-to-gross domestic product (GDP) ratios, an internationally comparable measure of R&D intensity. Canada's GERD-to-GDP ratio fell from 1.73 in 2014 to 1.65 in 2015. In comparison, the OECD average was 2.38 in 2015, with Israel recording the largest ratio at 4.25. Among G7 nations, Japan ranked highest with a GERD-to-GDP ratio of 3.29, while Canada's ranking fell to sixth place.

Chart 3  Chart 3: Gross domestic expenditures on research and development (GERD) as a percentage of gross domestic product (GDP), by G7 country, 2015
Gross domestic expenditures on research and development (GERD) as a percentage of gross domestic product (GDP), by G7 country, 2015

  Note to readers

This release presents actual gross domestic expenditures on research and development (GERD) for 2015 and preliminary data for 2016 and 2017 at the national level. Provincial level data are only available for 2015.

Data for GERD are available in current and constant dollars for both performing and funding sectors by science type, province, territory and region in CANSIM table 358-0001.

There are six GERD performing sectors in Canada: business enterprise, private non-profit, higher education, federal government, provincial government and provincial research organizations. The funding sectors are the same as the performing sectors, but also include the foreign sector.

Revised time-use coefficients have been applied to Statistic's Canada higher education research and development (R&D) model, starting with the 2012 reference year. Data from previous years for the higher education sector are not comparable. GERD data prior to 2012 should be used with caution.

GERD data presented in this release are performance based and correspond to the sum of intramural R&D expenditures reported by performing sectors. Funding sector data are derived from the source of funds indicated by the performing sectors. As a result, GERD funding sector values will not equal funding data collected and released by individual sectors.

Data for the provincial government performing sector are currently modelled and based on results from the 2011 Provincial Scientific Activities Survey. However, this release includes 2015 data on R&D activities performed by the provincial government of Quebec, as the province conducted its own survey and provided the information to Statistics Canada. Provincial research organization data are collected through a Statistics Canada survey.

Provincial and territorial expenditures are assigned to the province or territory in which the performing organization is located. Provincial and territorial funding sector expenditures represent R&D funding distributed in a province or territory. The funds do not necessarily originate from within the province.

The business enterprise data source for the gross domestic expenditure on research and development program has been redesigned, including concepts and methodology starting in 2014. Users should therefore exercise caution when comparing data with historical datasets. To learn more about these survey changes, consult the Research and Development in Canadian Industry (RDCI) page on our website.

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).

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