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PwC: World record in corporate Research & Development spending

17/01/2018 14:13

Annual worldwide corporate R&D spending broke through $700bn in annual investment, according to an annual analysis of R&D spending across 1000 global public companies by PwC’s Strategy&.

It shows corporate R&D spending increased a steady 3% in the past year, bouncing back from less than 1% increase previously.

However, in a global survey with562 executive participants, R&D leaders expressed concerns about the growing heat of rhetoric about economic nationalism – and its potential impact on where companies invest in R&D how they conduct innovation.

52% of respondents say that a general move toward economic nationalism will have a moderate or significant impact on their companies’ R&D efforts.

Major companies have been conducting some R&D outside their headquarters countries for decades. In 2015 it was determined that 94% of major corporations conduct their R&D in multiple countries.  But increasing attention on regulations and policies for visas, labor movement, and the regulations governing the sharing of knowledge and technology are causing some companies to question how sustainable their integrated global innovation networks are.

Nearly 33% of R&D executives surveyed, report that they have already felt the effects of economic nationalism on their R&D talent acquisition or retention because of visa or work restrictions — either losing employees, seeing less talent available, or in hiring more local talent.

Global Innovation 1000

The Strategy& Global Innovation 1000 study analyses spending at the world’s 1000 largest publicly listed corporate R&D spenders and is now in its 13th year

·         Amazon is the largest spender on R&D in the Global Innovation 1000 study, the first time the top spender is a high tech firm. It is worth noting thatall top four spenders are high tech companies.

·         In general, Software &Internet industry companies continue to increase their year-on-year R&D spending, and the analysis shows that Healthcare companies will surpass Computing & Electronics to become the largest industry in terms of R&D spending - the first time in 12 years of analysis.

·         Overall, Computing & Electronics, Healthcare, and Automotive are the top three industry sectors and represented 61.3% of global R&D spending in 2017.

·         Alphabet, Amazon, GE, IBM and Microsoft all increased their ranking in the 10 Most Innovative Companies list, according to a global survey of R&D executives

·         R&D spending by companies based in China declined for the first time in the study, it increased in Japan for first time in 4 years, and continued to grow moderately in North America.