R&D spending in OECD countries rose again in 2020

R&D spending in OECD countries rose again in 2020

Spending on research and development increased in OECD countries in 2020, despite the sharp decline in economic activity due to the COVID-19 pandemic, according to the latest update of the OECD’s Main Science and Technology Indicators. R&D growth was lower than in recent years, but this still marks the first time on record that a global recession has not translated into a drop in R&D spending.

R&D spending across OECD economies rose by 1.8% in real terms in 2020, much lower than the roughly 4-5% growth of previous years but still a reflection of how investments in R&D have been an integral part of the economic and societal response to the COVID-19 crisis.

At 2.7%, growth in R&D spending by government institutions outpaced growth at universities (2.4%) and businesses (1.5%). The business sector had led R&D growth in OECD countries since the 2009 financial crisis, accounting for nearly three quarters of total spending.

R&D expenditure trends in OECD countries, 2007-20 (2007=100)


The US and China consolidated their positions as R&D powers in 2020 while the EU lost some ground. Real R&D spending growth in the OECD area was driven primarily by growth of 5% in the United States, while spending in Germany and Japan declined by 5.3% and 2.7% respectively. In the EU27 area, lower business R&D pulled down overall spending, with much of the EU’s business R&D concentrated in industries that were hit hard by the COVID-19 crisis. China’s reported R&D expenditure grew by 9% in 2020, a figure comparable with previous years.  

OECD R&D intensity (a headline measure of domestic expenditure on R&D expressed as a percentage of GDP) rose from 2.5% in 2019 to nearly 2.7% in 2020, however this increase was exaggerated by the major decline in GDP (-4.5% across OECD countries).

Although official statistics on R&D spending for 2021 will only be available in the first quarter of 2023, leading indicators developed and monitored by the OECD suggest there may be a return to normal spending by governments in 2021 and a significant recovery in business spending.

Further detail on these data trends, and interactive charts, are available at the following links, and OECD R&D analysts are available for interview by emailing the OECD Media Office.


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