Product development in Canada spans new products, improved products, design work, software, research, commercialization, and intellectual-property protection. The latest figures below cover mainly 2020–2022, with activity measures from 2022 and comparisons with earlier survey periods. They show both the scale of innovation and the different ways businesses turn ideas into offerings.
Contents
- Product innovation rates and recent trends
- Product development by industry
- How novel new products were
- Activities used to develop and commercialize products
- The role of enterprise size
- Who develops products and how they are protected
Product innovation rates and recent trends
Statistics Canada’s Survey of Innovation and Business Strategy, 2020–2022 reports a decline in several broad innovation measures compared with 2017–2019. The share of Canadian businesses reporting product innovation fell from 52.7% in 2017–2019 to 46.6% in 2020–2022. Business-process innovation also declined, from 72.7% to 63.0% over the same periods. The share reporting either product or business-process innovation decreased from 79.8% to 71.9%.
The survey also records how the COVID-19 pandemic related to product innovation during 2020–2022. Among Canadian product innovators, 5.1% introduced products exclusively in response to the pandemic. A further 38.8% said that at least some of their product innovations were in response to COVID-19. These percentages describe product innovators, not all Canadian businesses.
The proportion of Canadian businesses conducting innovation activities fell from 52.5% in 2019 to 47.2% in 2022. Within the 2022 group that conducted innovation activities, 89.9% introduced an innovation during 2020–2022. Among businesses that did not conduct innovation activities in 2022, 55.7% nevertheless introduced an innovation during 2020–2022. That distinction matters: a business can report a recent innovation without reporting innovation activity in the later reference year.
Product development by industry
The Innovation rate by sector, 2020 to 2022 measures the share of businesses introducing a new or improved product or business process. It is broader than product innovation alone, so these industry figures should not be read as product-development rates in isolation.
| Canadian industry | Innovation rate, 2020–2022 |
|---|---|
| Information and cultural industries | 79.5% |
| Finance and insurance, excluding monetary authorities | 79.0% |
| Professional, scientific and technical services | 78.2% |
| Wholesale trade | 77.4% |
| Construction | 74.4% |
| Utilities | 72.6% |
| Manufacturing | 72.0% |
| Retail trade | 70.8% |
| Administrative and support, waste management and remediation services | 69.3% |
| Postal services, couriers and messengers, warehousing and storage | 67.7% |
| Real estate and rental and leasing | 67.1% |
| Transportation | 62.8% |
| Mining, quarrying, and oil and gas extraction | 61.0% |
| Management of companies and enterprises | 58.2% |
| Agriculture, forestry, fishing and hunting | 50.9% |
Information and cultural industries had the highest listed rate at 79.5%, followed closely by finance and insurance at 79.0% and professional, scientific and technical services at 78.2%. Wholesale trade recorded 77.4%, while construction recorded 74.4%.
Manufacturing’s rate was 72.0%, compared with 70.8% in retail trade and 72.6% in utilities. The listed rate was 67.7% for postal services, couriers and messengers, warehousing and storage, and 67.1% for real estate and rental and leasing. Transportation recorded 62.8%, mining, quarrying, and oil and gas extraction 61.0%, and management of companies and enterprises 58.2%. Agriculture, forestry, fishing and hunting had the lowest listed rate, at 50.9%.
How novel new products were
The Statistics Canada table on novelty of product innovations separates products that were new to a market from products that were new only to the business. Among Canadian businesses with product innovations in all surveyed industries during 2020–2022, 32.9% introduced a product new to one of their markets. Another 44.1% introduced a product new to the business only, while 15.2% reported products that were both new to one of their markets and new to the business.
The categories describe different degrees of novelty and are not interchangeable. A product new to a business may already exist elsewhere, while a product new to one of its markets represents a different competitive position. The reported percentages should therefore be retained as separate measures rather than combined into an unsupported total.
Industry patterns varied. Among businesses with product innovations in agriculture, forestry, fishing and hunting, 52.4% introduced a product new to one of their markets, 57.0% introduced a product new to the business only, and 38.4% reported products new both to a market and to the business. In manufacturing, the corresponding figures were 39.2%, 46.0%, and 15.5%.
Construction businesses with product innovations reported 26.2% for products new to one of their markets, 51.8% for products new to the business only, and 22.1% for products new in both ways. These figures are percentages among product innovators in each industry, not shares of all businesses in the industry.
Activities used to develop and commercialize products
The Statistics Canada table on innovation activities shows which activities Canadian businesses conducted in 2022. Overall, 47.2% conducted at least one innovation activity. The most frequently reported listed activity was software development and database work, at 24.7%. Employee training specifically for innovation projects followed at 22.6%, while research and experimental development, conducted in-house or outsourced, was reported by 20.9%.
Marketing and brand-equity activities linked to introducing new goods, services, or processes were reported by 19.9% of businesses. Acquisition or development of advanced technology was reported by 19.1%, and engineering, design, and other creative work by 17.2%. Intellectual-property activities to realize innovation projects were reported by 11.9%.
Less common listed activities included innovation management, at 8.6%, and other innovation activities, at 5.5%. The figures describe the incidence of each activity; they do not establish that every business conducting one activity also conducted another.
Together, the measures cover more than laboratory research. Product development can involve software and databases, advanced technology, design and creative work, training, marketing, and intellectual-property work. In 2022, engineering, design and other creative work appeared in 17.2% of businesses, while research and experimental development appeared in 20.9%.
The role of enterprise size
Enterprise size was associated with the incidence of innovation activity in 2022. Small enterprises, defined here as having 20–99 employees, recorded 45.0% conducting at least one innovation activity. The rate was 53.7% among medium-sized enterprises with 100–249 employees and 66.5% among large enterprises with 250 or more employees.
The same size gradient appeared in research and design activity. Research and experimental development, in-house or outsourced, was reported by 18.7% of small enterprises, 26.3% of medium-sized enterprises, and 42.1% of large enterprises. Engineering, design and other creative work was reported by 15.8% of small enterprises, 22.3% of medium-sized enterprises, and 27.2% of large enterprises.
| Enterprise size | At least one innovation activity | Research and experimental development | Engineering, design and other creative work |
|---|---|---|---|
| Small, 20–99 employees | 45.0% | 18.7% | 15.8% |
| Medium, 100–249 employees | 53.7% | 26.3% | 22.3% |
| Large, 250+ employees | 66.5% | 42.1% | 27.2% |
These measures indicate how often activities were reported within each size group. They do not measure the amount spent, the number of products developed, or the success of a product launch. A higher incidence of activity also does not by itself show that larger enterprises produce more novel products.
Who develops products and how they are protected
Among Canadian businesses introducing new or improved products during 2020–2022, 65.0% developed the products themselves, according to the Survey of Innovation and Business Strategy. This measure concerns businesses introducing new or improved products, not all businesses.
Among businesses that developed product innovations during 2020–2022, 38.4% filed or registered those innovations in Canada to protect intellectual property. Among businesses that developed new products, 45.0% used non-disclosure agreements, 43.7% used trademarks, and 33.0% used patents to protect them.
The protection measures represent different tools and should not be treated as mutually exclusive choices. A business may use confidentiality through a non-disclosure agreement, brand protection through a trademark, and patent protection for an invention. The available figures show reported use during 2020–2022; they do not indicate the legal strength, commercial value, or outcome of any individual protection strategy.
Collaboration was reported by 14.0% of Canadian businesses for innovation activities during 2020–2022. That cooperation measure is broader than product co-development alone, so it should not be interpreted as the share of products created with an external partner. It does, however, place the 65.0% self-development figure alongside a separate measure of innovation cooperation.