Lack of skilled workers: innovation potential is lost

Nine out of ten of the companies surveyed carried out R&D activities in 2022. 59% of companies recorded rising R&D expenditure in 2022, 35% stable and only 6% declining. R&D expenditure is also likely to rise again in 2023: 54% of the companies surveyed expect R&D expenditure to increase. Only every second company that does not conduct R&D actually has no need to do so. The other companies usually lack the personnel to do so. This very much affects companies with fewer than 100 employees.

"The mechanical engineering sector is keeping up the pace of R&D and relying on Germany as a location for innovation," emphasizes Hartmut Rauen, Deputy Managing Director of the VDMA, on the occasion of the publication of the survey, which was conducted for the first time. "But because there is a lack of R&D personnel, innovation potential is still being lost, especially in medium-sized industrial companies."

Bottlenecks in the labor market

According to the survey, 90 percent of respondents are currently observing bottlenecks in the labor market for academics and R&D specialists. Every second company in the survey even speaks of severe bottlenecks. Smaller companies are often more affected than large ones. In addition to a lack of personnel, the increased costs for energy and materials are among the negative factors influencing R&D activities in the sector. Companies also mentioned increasing regulatory requirements and bureaucracy.

The survey shows that companies are responding to megatrends such as decarbonization, automation and digitalization with increased research efforts. "Thanks to high-performance engineering sciences and innovation networks such as joint industrial research, we have an outstanding innovation area in this country," emphasizes Rauen. "It is not without reason that around 50 percent of companies see their most innovative competitors in Germany, particularly in southern Germany." China, the USA and Italy follow at a considerable distance.

Demand for tax incentives for research

Demand for the tax-based research subsidy ("research allowance") introduced in 2020 is increasing in the mechanical and plant engineering sector. Among users of public funding programs, every second company is already benefiting from the new funding instrument. Other specialist federal programs and the Central Innovation Program for SMEs (ZIM) follow some way behind. The research allowance is particularly popular among companies with between 250 and 1,000 employees.