What is R&D in German business?

Germany is Europe’s strongest economy. And no other country on this continent invests more in R&D. German companies alone spent around 76 billion euros on their own research in 2021. 

Additionally, nearly 27 billion euros went on research contracts awarded to other companies, universities or state research institutions. This makes the German business economy one of the most research-oriented in the world.

Innovation through research

Finding solutions is one of the real strengths of German enterprises. Whether it is a question of developing cancer vaccines or creating AI applications for the control of wind power plants – German companies are committed to resolving the most important issues of the future. They run their own research institutes, establish research associations and cooperate with universities and other research institutions all over the world. And they do so with striking success: Germany ranks eighth in the “Global Innovation Index” of 132 countries studied, and holds fifth place in terms of global patent applications filed under the Patent Cooperation Treaty, PCT. This is thanks in particular to the R&D activities pursued by German companies.

SMEs also conduct research

Naturally, it is primarily the big companies like Volkswagen, SAP or Boehringer that are among the world’s biggest investors in R&D. Small and medium-sized enterprises (SMEs) are also committed to research, however, and have greatly increased their expenditure on R&D in recent years. This is especially true of smaller companies in the areas of biotechnology, artificial intelligence and cloud computing.

Facts and figures

Approx. 75.8 billion euros in internal expenditure on business R&D (2021)

Approx. 478,000 R&D personnel in German enterprises (2021)

Business enterprise R&D expenditure as a percentage of GDP: 2.1% (2021)

More than 66% of total R&D funding in Germany is investment by companies

More than 17,000 international patent applications (PCT)