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Record spend on research and development in 2011

Enterprise Minister Arlene Foster today welcomed figures that show Northern Ireland saw the highest ever Research and Development (R&D) expenditure in 2011.
Tuesday, 20 November 2012

Investment was up by 9% in cash terms, also equating to a 6% real terms rise.

Total R&D investment rose from £521.4million in 2010 to £567.5million in 2011.

Over the year, total Business R&D expenditure increased in cash terms by £44.8million (13%) to £388.8million. There was also an increase of £2.5million (2%) in Higher Education expenditure to £164.3million.

The increase in Business R&D expenditure was due to higher spend by externally owned companies – up 23% (from £234.1m in 2010 to £287.7m in 2011). Northern Ireland Businesses’ (in–house) R&D expenditure has shown the sixth highest percentage annual increase (9%) of the UK regions, with a rise in R&D investment from £324million in 2010 to £354million in 2011.

Enterprise Minister, Arlene Foster said: “I very much welcome the latest figures which show the highest expenditure ever on R&D in Northern Ireland. It is very encouraging to see that Business Research & Development (R&D) expenditure is the highest figure on record. Businesses spent some £389 million on R&D in 2011, an increase of 13% over the year. This shows that despite the difficult economic conditions, businesses are still prepared to invest heavily in their future competitiveness.

“It is also encouraging to see an increase in the total R&D expenditure for Small and Medium-sized Enterprises. This continues to be a priority area as well as continuing to further exploit our reputation for excellence in specific niche areas as identified by the science/industry MATRIX panel. “

The Minister added: “Best practice research illustrates the vital role that innovation and R&D has to play in Northern Ireland’s economic development. Those companies that continue to invest in R&D, despite difficult trading conditions, will be best placed to exploit future opportunities.

“We must continue to extend the number of companies who devote resources to R&D and to make this an integral part of business culture in Northern Ireland. Investing in R&D, innovation and collaborative ventures will provide the high quality jobs and the critical mass of successful businesses that this economy needs to grow.”

Notes to editors:

1. Of the £567.5 million spent on total R&D, £388.8 million (69%) was spent by Businesses, £164.3 million (29%) by the Higher Education sector and the remainder was Government expenditure.

2. The change in total R&D to 2011 was due to increases of £44.8 million (13%) in Business R&D expenditure and £2.5 million (2%) in Higher Education expenditure coupled with a decrease of £1.2 million (-8%) in Government R&D expenditure over the year.

3. Companies with ownership outside Northern Ireland continue to play an important role in financing R&D. Such externally owned companies accounted for 74% of expenditure compared to 26% by locally owned companies. R&D expenditure by locally owned companies decreased by 8% (£8.8million) over the year compared to an increase of 23% (£53.6million) by externally-owned companies.

4. Northern Ireland is dependent on a relatively small number of companies for a significant proportion of R&D expenditure. The ten biggest spending companies accounted for 62% of the total R&D spend in Northern Ireland in 2011, slightly higher than in 2010 (59%).

5. Small and Medium-sized Enterprises (SMEs - enterprises with less than 250 employees) accounted for 36% of Business R&D expenditure. Total R&D expenditure for SMEs increased by £7.2 million (5%) from 2010 to 2011, in cash terms. Since 2006 it has increased by 72% to £140.6 million.

6. Of the 12 UK regions, nine showed an increase in in-house business R&D expenditure in cash terms over the period 2010 to 2011. Northern Ireland Businesses’ (in–house) R&D expenditure has shown the sixth highest percentage annual increase (9.2%) of the UK regions, with a rise in R&D investment from £324million in 2010 to £354 million in 2011. In-house R&D expenditure for the UK as a whole increased by 8.4% over the year.

7. The Northern Ireland in-house business R&D expenditure as a proportion of Gross Value Added (GVA) (1.2%) was the sixth highest of the twelve UK regions based on 2010 Regional GVA data published by the Office for National Statistics on 14th December 2011. The corresponding figure for the UK was also 1.2%. In 2005, the Northern Ireland figure was 0.6%.

8. In real price terms, total R&D expenditure rose by £32.1 million (6%). Business R&D expenditure rose by £35.6 million (10%), Higher Education R&D expenditure fell by £1.8 million (-1%) and Government expenditure fell by £1.6m (-10%) over the year.

9. Please note that R&D expenditure may vary from year to year due to the influence of one or two large-scale projects, especially where there is significant capital expenditure.

10. For further information – full detailed results will be available in the Research & Development Statistics Bulletin, which will be published on 14 December 2012 at the following website: DETI Website link to external website

11. For media enquiries, please contact DETI Press Office on 028 9052 9604. Outside office hours, please contact the Duty Press Officer via pager number 07699 715 440 and your call will be returned.

12. General information on R&D can be obtained from Patrick McVeigh, DFP Economic and Labour Market Statistics Branch, on Tel: 028 9052 9606.