There are indications – nothing concrete, but indications nonetheless – that Atlantic Canada is beginning to improve its performance in research and development.

The region has historically been a weak player in Canadian R&D, especially in the private sector. Canada itself ranks poorly in international rankings in R&D and its East Coast is especially weak. But the most recent data on R&D spending shows the region is spending more on R&D, and the increases exceed the growth in the country overall.

But the picture is not 100 percent positive. There is also data showing that the number of people employed in R&D has declined in the region, mainly because of Nova Scotia.

R&D data is usually murky. It’s always years out of date, and it’s difficult to nail down exactly what activity constitutes R&D and which jobs are devoted to it. The best metrics available come from Statistics Canada, and I’d like to thank David Campbell of Jupia Consultants in Moncton for his help in finding and understanding them.

The most recent data in overall spending only goes up to 2017, but it shows an improvement. Over five years, the region’s gross domestic spending on R&D rose by about one-fifth, led by a surge in Nova Scotia and New Brunswick. That almost doubles the roughly 10 percent growth rate in Canada overall (though it falls short of national leader British Columbia, whose R&D spending rose by more than one-third).

Gross Domestic Spending on R&D ($M)

Source: Statistics Canada

There are other stats that are more worrisome. For example, StatsCan data on people employed in R&D – which goes up to 2018 -- shows an actual decline in the region.

Source: Statistics Canada

To be fair, the decline in R&D employment is mild on the East Coast compared with the country overall, which was dragged down by reductions in Ontario and the Prairies.

Overall, the increase in spending is the more important number and suggests the region’s R&D performance was improving in the middle of the last decade.

Critics might claim that the increase in R&D spending is simply due to more research at universities – a category Atlantic Canada has always done well in. But the money the East Coast universities received for R&D in the past few years has been pretty steady. Dalhousie University has received about $140 million to $150 million each year for several years to lead the region. The only university whose research budget has increased dramatically is Memorial University of Newfoundland. According to Re$earch Infosource, research income at MUN has increased 66 percent in the seven years to 2018, when it was $116.8 million.

The trend in Atlantic Canadian R&D seems to be moving in the right direction, with more private sector activity taking place. But on an international level we still have a dreadful performance. In 2017, the region accounted for just 4.2 percent of the R&D in Canada, and Canada placed 23rd in R&D spending in a list of 44 countries listed by the Organization for Economic Cooperation and Development in 2017.

The growth in R&D spending is important because the region's policy makers are intent on improving the "innovation economy". That means we need more startups and faster-growing startups, but it also means more innovation by traditional businesses and academic institutions. The spending data suggests that we're improving.