In 2022, the German machinery and equipment manufacturing industry invested nearly 8.7 billion euros in research and development, an increase of nearly 6% year-on-year and a record high.

In 2022, the German machinery and equipment manufacturing industry invested nearly 8.7 billion euros in research and development. According to Stifterverband’s latest report, this number is up nearly 6% from last year, reaching a new high.

“Our response to megatrends such as carbon neutrality, automation and digitalisation is to step up research and innovation,” Hartmut Rauen, vice president of the VDMA, the German machinery manufacturers’ federation, said at the launch of the new Stifterverband data. In almost every industry, the production, scale and competitiveness of products are dependent on innovative solutions in mechanical engineering.”

According to the Stifterverband report, employment in the research and development sector in the German machinery and equipment manufacturing industry reached a new high of 54,000 in 2022, an increase of more than 5% over the previous year.” Our industry is a major employer of engineers, especially professionals in the fields of mathematics, Information Sciences, Natural Sciences and Technology (MINT), “Rauen stressed.

8440-2165A

Despite the increase in personnel numbers, according to the latest VDMA membership survey, talent shortage remains the biggest challenge facing mechanical engineering R&D activities.” This results in a loss of innovation potential, especially among small and medium-sized industrial enterprises, “explains VDMA Vice Chairman. As an innovative country, Germany urgently needs to close the gap between Labour supply and demand.”

Looking ahead to 2023, the importance of research and development is expected to remain high or even grow further. According to Stifterverband, R&D investment in the machinery and equipment manufacturing industry is expected to increase by about 5% in 2023. “As a core enabler of the industry, we will continue to accelerate the pace of research and development,” Rauen said optimistically. The research subsidy will provide additional impetus to mechanical engineering as it is applicable to a variety of topics and is easily accessible to smes.”

The Growth Opportunity Act

Growth Opportunity Act

Germany’s Growth Opportunities Act plans to help small and medium-sized enterprises remain competitive and promote energy efficient and environmentally friendly technologies through tax cuts and other measures by 2028. The measures of the bill mainly involve two major aspects: first, encourage enterprises to adopt more energy-saving and emission-reduction technologies through tax breaks, with a total tax reduction of up to 7 billion euros per year; Second, the government will directly provide financial subsidies to enterprises to encourage their technological innovation, especially for small and medium-sized enterprises, the subsidy rate will be increased from 25% to 35%.

The Growth Opportunity Act is expected to significantly expand the scope of research grants.” We look forward to the swift implementation of this measure, “Rauen stressed. Ultimately, this will help smes (companies with up to 3,000 employees) bridge the gap in innovation funding.”