Provincial and Territorial Ranking
- Quebec and Ontario rank fourth and fifth, respectively, but earn only “C” grades given the very strong performance by top-ranked Finland.
- Seven provinces earn “D–” grades, ranking below the poorest-performing peer country, Switzerland.
- Researchers in Ontario, Quebec, B.C., and most peer countries are much more likely to be employed in industry than are researchers in the remaining seven provinces.
Why are researchers important to innovation?
There is an important link between research and innovation. Although research activity does not necessarily lead to new innovations, and although certain types of innovation (e.g., ICT adoption) depend less on research than other types (e.g., ICT development), much innovation nevertheless depends on research conducted in the public and private sectors. Researchers are an essential part of that activity. According to the OECD, researchers are “professionals engaged in the conception or creation of new knowledge, products, processes, methods and systems, as well as in the management of the projects concerned.”1 They play lead roles in, for example, developing new technologies, creating and testing new products, engineering new processes, assessing market potential for products and services, and managing R&D projects from conception to commercialization.
Therefore, researchers provide a useful indicator of both innovation capacity and activity in an economy. In terms of capacity, the more researchers employed, the better prepared public and private sector organizations are to initiate and complete complex research projects that could lead to innovations. Second, in terms of activity, the more researchers engaged in R&D, the more likely it is that research that could lead to innovation is actually occurring.
How are researchers measured?
The report card indicator “researchers engaged in R&D” is measured as the number of full-time equivalent researchers employed for every 1,000 individuals employed in a province or country. Full-time equivalent “is a measure of the time actually devoted to research and development.”2 Conventionally, a full-time position entails working full-time hours for a full year. If an employee spends half her time on R&D and half on something else, she would count as 0.5 full-time equivalent. Similarly, if five people each worked 1 day per week on R&D for a year, together they would count as 1 full-time equivalent.
The indicator includes individuals classified as “researchers” but excludes those classified as “technicians” and “other R&D personnel.” Researchers are defined as scientists and engineers “engaged in the conception or creation of new knowledge, products, processes, methods and systems” and includes managers “engaged in the planning and management of the scientific and technical aspects of a researcher’s work.”3
We include researchers employed in government, higher education, and business. Focusing on only the business sector would create a measurement bias against those provinces and countries whose innovation ecosystems place more emphasis on research conducted in government and higher-education labs and facilities. We calculate the rate as the number of researchers per 1,000 individuals employed, rather than per total population, because we are interested in capturing how research-intensive the employed labour force is, rather than the research capacity of the population more broadly.
How do the provinces rank relative to international peers?
Quebec and Ontario rank fourth and fifth, respectively, relative to international peers on the researchers indicator. However, because the top country, Finland (15.7 researchers per 1,000 population), performs so well, Quebec (11) and Ontario (10.8) manage to earn only “C” grades. Based on the performance of these two large provinces, Canada as a whole ranks 11th but earns a “D” grade.
With 7.7 researchers per 1,000 employed, B.C. earns a “D” and ranks 18th overall, placing it behind all but Switzerland among international peers. The remaining seven provinces all earn “D–” grades and take up the bottom seven positions in the international rankings. Newfoundland and Labrador has 5.7 researchers per 1,000 employed, which is only slightly more than a third of top-performer Finland’s rate (15.7). At the bottom of the rankings is New Brunswick, whose 3.9 researchers per 1,000 employed is less than a quarter of Finland’s rate and less than half the Canadian average (9).
How do the provinces rank relative to each other?
Quebec and Ontario are the highest-ranking provinces and score “C” grades. With fewer than 8 researchers per 1,000 employed, the third-ranked province, B.C., earns only a “D.” This is lower than the Canadian rate of 9 researchers per 1,000 employed. The remaining seven provinces earn “D–” grades with researchers per 1,000 employed ranging from only 3.9 (New Brunswick) to 5.7 (Newfoundland and Labrador).
Has provincial performance on researchers engaged in R&D changed over time?
All provinces have increased the number of researchers per 1,000 employed since 2000. B.C. saw especially strong growth, rising from 5.2 to 7.7 researchers between 2000 and 2013. Researchers per 1,000 employed in Newfoundland and Labrador rose from 3.5 in 2000 to 5.7 in 2013. Overall, the number of researchers per 1,000 employed increased by an average of 1.6 across the provinces. This suggests that innovation capacity in the provinces, and Canada as a whole, has improved over the past decade.
At the same time, however, among international peers, the number of researchers grew by a much larger factor of 2.4 researchers per 1,000 employed, on average. So, most provinces actually lost ground relative to international peers even as their rates increased. Growth was especially strong in Denmark, which more than doubled its rate from 7.1 researchers per 1,000 employed in 2001 to 14.9 in 2013, improved from a “D” to an “A” grade, and moved from 11th to 2nd place among international peers and provinces.
Despite modest growth, the seven lowest-ranking provinces have remained consistent “D–” performers relative to international peers since 2000. B.C. has been a consistent “D” performer. Quebec and Ontario perform no better than they did in 2000. However, Ontario managed to earn a “B” grade for three years—from 2007 and 2009—before returning to the “C” it now holds, while Quebec was a “B” grade performer for five years—from 2007 to 2011—before settling back to a “C” in the current ranking.
Where are researchers employed?
Ontario and Quebec have the highest proportions of researchers employed in business, at 61 per cent and 59 per cent, respectively. By contrast, only 29 per cent of researchers in Saskatchewan, 32 per cent in Nova Scotia, and 33 per cent both in Newfoundland and Labrador and in New Brunswick work in the business sector. Although research performed in higher education and government facilities is critically important—and important to more than just innovation—jurisdictions with higher proportions of researchers active in industry are likely to be better at transforming ideas into new products and services and at implementing new processes, marketing methods, and business models.
Among international peers, the largest share of researchers is employed in industry, rather than government or higher education. On average, 56 per cent of researchers are employed by business in peer countries, ranging from a high of 74 per cent in Japan to a low of 35 per cent in the United Kingdom. Overall, Canada matches the international norm, with 57 per cent of researchers employed in business.
Do the provinces lack researchers or research positions?
That so many provinces perform poorly on this indicator is likely a result of both the supply of and demand for—specifically industry demand for—researchers.
Overall, Canada has a relatively high proportion of university graduates and thus a good foundation for developing researchers. Five provinces earn “A”s or “B”s on university attainment in the education and skills report card, while Canada as a whole earns a “B” and ranks seventh among international peers. But Canada and the provinces lag international peers in terms of graduates of advanced research programs—specifically doctoral programs. The five provinces with the lowest shares of researchers—Saskatchewan, Nova Scotia, P.E.I., Manitoba, and New Brunswick—also have the lowest-shares of PhD graduates. By contrast, the top performers on the researcher indicator—Finland, Denmark, and Sweden—are also among the top-ranked on PhD graduates, earning grades of “A” (Finland and Sweden) or “B” (Denmark) and taking three of the top seven positions. In short, while Canada has a strong record on undergraduate education, the country lags international peers in graduating people from the higher levels of education more often associated with research occupations.
At the same time, other evidence points to the role of employer demand in explaining researcher rates. Not surprisingly, the share of researchers is correlated with R&D spending in provinces and peer countries. Jurisdictions with higher R&D spending employ more researchers, while those with lower R&D spending employ fewer researchers. The top-ranking countries on researchers per 1,000 employed—Finland, Denmark, and Sweden—are also among the top five in R&D spending (business enterprise R&D (BERD) + public R&D ). By contrast, the bottom-ranking jurisdictions on researchers—New Brunswick, Manitoba, and P.E.I.—are among the bottom five in R&D spending.
As a whole, Canada employs more researchers than its R&D spending would predict (owing to a more labour-intensive, rather than capital-intensive, approach to R&D), though it earns only a “D” relative to international peers on the share of researchers.4 Even this labour-intensive approach to R&D, together with a low average researcher wage relative to international peers, cannot compensate for the country’s exceptionally low levels of BERD.5 The demand for researchers simply is not there.
How can provinces improve?
Provinces are unlikely to do better on the researcher report card until R&D activity, including BERD and public R&D, increases. Moreover, many employers still need to be convinced that hiring advanced researchers can contribute to better performance. Many employers continue to hold negative views about advanced researchers, particularly PhDs—such as that they work too slowly and lack teamwork and communication skills for professional environments. Yet evidence increasingly shows that organizations that work with advanced researchers subsequently develop more robust research and innovation programs and achieve better business performance overall.6
For example, employers in Canada who have worked with masters or PhD students through paid internship programs organized by the national organization Mitacs have seen improvements across a range of innovation and related business outcomes. Two-thirds of surveyed companies report that they have already, or soon will, commercialize the result of research projects conducted with Mitacs research interns. A quarter of respondents report that they have hired research interns into newly created permanent research positions, while 40 per cent note that they invested $100,000 of new money into R&D as a result of working with a Mitacs intern—including 10 per cent that invested more than $500,000 of new R&D money.7
This suggests that not only can increasing R&D spending stimulate greater researcher employment but also that working with researchers can stimulate new R&D spending—and that both outcomes contribute to more robust innovation potential. In that case, provinces should find ways to spark virtuous circles of rising R&D spending and researcher employment. The key will be to convince more employers to offer opportunities to researchers, giving researchers a chance to change misperceptions and make valuable contributions, and, simultaneously, to encourage more firms to increase R&D spending.