Australia’s business investment in research and development (R&D) surged by 18% to reach $24.4 billion in 2023-24, with artificial intelligence (AI) emerging as the fastest-growing area, according to new data from the Australian Bureau of Statistics (ABS).
Spending on AI R&D skyrocketed by 142% over two years, from $276.3 million in 2021-22 to $668.3 million in 2023-24, highlighting the accelerating shift of Australian businesses towards AI-driven innovation.
“The strongest growth in R&D was seen in the Information and computing sciences research field,” said Robert Ewing, ABS head of business statistics. “This includes AI, which has clearly become a key priority for Australian firms.”
Software engineering remained the dominant sub-category within this field, rising 26% to $4.9 billion.
The professional, scientific and technical services industry led overall R&D spending, contributing $9.2 billion (38% of total expenditure), followed by manufacturing ($5 billion) and financial and insurance services ($3.5 billion). Despite changes in sector priorities, business R&D investment held steady at 0.9% of GDP.
In terms of socio-economic objectives (SEO), R&D aimed at information and communication services became the top category, jumping 50% to $5.9 billion, surpassing manufacturing, which dipped 3% to $4.6 billion. Health, energy, and mineral resources also saw increased allocations.
Ewing noted the importance of tracking R&D by intended outcome, saying the data “helps inform policy and strategy decisions to support businesses to improve research outcomes.”
How can businesses capitalise on the AI-led R&D momentum? Share your thoughts in the comments.
