Research and development in the business enterprise sector, 2008, preliminary figures

This is the fourth year running with marked growth of R&D activity in business enterprises, but it seems as if the trend stops in 2009. The business enterprise sector, as a whole, expects unchanged R&D activity in 2009 compared with 2008. This is based on the estimates made by the enterprises in the second quarter of 2009. It is worth noting that the estimates have been lower than the final figures in recent years.

For the second time, enterprises with 5-9 employees are included in the 2008 survey. These enterprises reported almost NOK 1.3 billion in R&D expenditure. The total R&D expenditure for all business enterprises for 2008 thus amounts to NOK 20.2 billion.

The number of R&D man-years increased by 6 per cent, from 15 268 in 2007 to 16 187 in 2008. Enterprises with 5-9 employees reported an additional 1 327 R&D man-years in 2008.

Increased R&D expenditure in the service industry

According to new industry classification, the manufacturing industry spent NOK 8.6 billion on R&D activity in 2008; an increase of 6 per cent compared with 2007. The service industry spent NOK 8.4 billion on R&D; an increase of 13 per cent. The number of R&D man-years also increased more in the service industry than the manufacturing industry. In the manufacturing industry, the number of R&D man-years remained unchanged in 2008 while the service industry had a growth of 12 per cent compared with 2007.

Moderate negative impact of the financial crisis

Business enterprises’ estimates of R&D activity indicate a moderate negative impact of the financial crisis that started in autumn 2008. The estimate indicates stabilisation in 2009 after a strong growth in the period 2005-2008.

This year’s survey includes a question about how the financial crisis has affected the enterprises’ R&D activity in 2009. Two thirds of the enterprises reported that the financial crisis did not affect the R&D activity. These enterprises reported that they will use about as much R&D resources as planned. The rest of the enterprises reported on the other hand that the financial crisis does have consequences for their R&D activity. A total of 29 per cent of the enterprises reported that the financial crisis contributes to use of less R&D resources than planned in 2009, while 6 per cent reported that the financial crisis contributes to use of more R&D resources than planned.

The enterprises reporting no effect of the financial crisis on R&D activity makes up 57 per cent of total R&D costs in 2008, while the enterprises reporting use of less R&D resources than planned due to the financial crisis makes up 38 per cent of total R&D costs.

The financial crisis has a different impact on R&D activity in the manufacturing industry and the service industry. The manufacturing industry seems to be more affected than the service industry. In the manufacturing industry, 33 per cent of the enterprises reported that the financial crisis contributes to use of less R&D resources than planned, while the share in the service industry was 25 per cent. The share of enterprises where the financial crisis had no effect on the R&D is lower in the manufacturing industry than in the service industry. In addition, the estimates of R&D expenditure in 2009 indicate a decrease in the manufacturing industry and an increase in the service industry.

The figure clearly indicates a certain correlation between the financial crisis’ impact and the enterprises’ estimated change in R&D expenditure from 2008 to 2009. Among the enterprises reporting that the financial crisis contributed to less R&D resources than planned, almost two-thirds of the enterprises estimated a decrease in R&D expenditure in 2009. Among the enterprises reporting that the financial crisis will contribute to more R&D resources than planned, more than two-thirds of the enterprises estimated an increase in R&D expenditure. Slightly less than half of the enterprises reporting no impact of the financial crisis still expected an increase in R&D expenditure.

New industry classification

Since January 2009, a new version of Norwegian industry classification (SIC2007) has been in use. One important change is that publishing and recycling are no longer classified as manufacturing industry. Publishing is now part of a new service industry; Information and communication.

The transition to the new industry classification makes it difficult to compare figures for 2008 with figures for earlier years. The figures for 2007 and 2008 presented in this article are comparable. To make this possible, the populations for the two years are slightly adjusted. This means that the figures for 2007 may differ slightly from earlier published figures. This is a link to a general overview of the transition to the new industry classification.

Tables:

• Table 1 R & D expenditure and R & D man-years in the business enterprise sector, by size class and industry. 2007 and 2008. NOK million and number
• Table 2 Impact of financial crisis on R & D activity in 2009, by industry. (+5 employees.) Share of enterprises. Per cent