New Zealand computer services and machinery manufacturing firms led the way in a nearly 30% lift in business spending on research and development (R&D) in 2016.
Stats NZ says companies spent $1.6 billion on R&D in 2016, up $356 million (29%) from 2014.
The computer services sector had the biggest dollar-value increase in R&D within the business community, up $125 million (40 percent) to $436 million in 2016.
Computer services firms include New Zealand businesses providing services such as producing and distributing software, and web design.
The second-largest increase in business-related R&D spending was for machinery and equipment manufacturing, up $105 million (37%) to $392 million in 2016.
These firms include high-tech manufacturing companies developing new products and services for sale in New Zealand or overseas.
Total spending on R&D by businesses, government, and higher education were $3.2 billion in 2016, up $531 million (20%) from 2014.
R&D in the higher education (university) sector lifted, and government R&D had a modest rise, but the bulk of the overall increase was from business spending.
“R&D spending is about investing in New Zealand’s future. It paves the way for new and better products or more efficient ways of doing things, although the process can take years,” says business performance senior manager Daria Kwon.
“While higher R&D spending is a key driver of economic growth according to some studies, it is not a guarantee that a business will be more creative or profitable,” says Kwon.
All services sector groups spent more on R&D in 2016 than in 2014, with an overall $203 million (32%) increase to $835 million.
In the higher education sector, universities’ R&D spending was up $143 million (18%) from 2014 to $960 million in 2016.
