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ZEW - Centre for European Economic Research

02/04/2020 | Press release | Distributed by Public on 02/04/2020 09:41

ZEW Innovation Survey 2019 – German Firms Increase Innovation Expenditure

The share of total turnover of the German economy spent on innovation - the so-called 'innovation intensity' - increased for the fourth time in a row, reaching a new record high of 3.3 per cent in 2018. At 4.9 per cent, the innovation intensity in the manufacturing industry is significantly higher than in the services sector (1.6 per cent), but the latter recorded stronger growth. In 2018, the electrical industry continues to top the list with an innovation intensity of 11.1 per cent, followed by the automotive industry (10.1 per cent), technical services (8.3 per cent), the chemical and pharmaceutical industry (8.2 per cent), information and communication services (7.4 per cent) and mechanical engineering (5.9 per cent).

Turnover generated through product innovations, i.e. total market novelties including imitations, amounted to 759 billion euros in 2018, about five per cent less than in the previous year. However, German companies were able to increase the turnover generated through market novelties, i.e. product innovations that had not been introduced by another company before, to a total of 177 billion euros. This corresponds to a 4.4 per cent increase compared to 2017. In 2018, turnover generated through product innovations accounted for 14.4 per cent of the total turnover of all economic sectors and company sizes covered by the innovation survey.

As of the reporting year 2018, the definition of innovations was adapted to the new internationalstandard. In particular, process innovations were defined more broadly than before and the recording of innovations in connection with digitalisation was improved. 'As a result, significantly more companies are now counting as innovators, namely almost 181,000,' says Rammer. Based on this new definition, the so-called innovator rate, i.e. the share of companies that have introduced new or improved products or processes, is 60.5 per cent.