ITIF report finds Germany outscoring US, Italy, and Canada in Innovation Competitiveness

A report from ITIF exploring the factors involved in ecosystem strength found that states in Germany generally perform better than states in the U.S., Italy, and Canada in terms of globalization, knowledge economy, and innovation capacity.

The Index reported that the critical factors influencing an ecosystem are the quality of education (especially in STEM fields), public and private R&D investments, the range of highly trained R&D personnel, economic dynamism, and entrepreneurship. Based on these indicators, ITIF ranked Massachusetts, California, Baden-Württemberg, Berlin, and Washington as the leading regions for innovation competitiveness.

While the U.S. outperforms its peers in higher education attainment (Knowledge Economy), Germany shows strength in technical and scientific employment. To prevent stagnation, ITIF recommends the U.S. promote industry-university partnerships supporting both R&D and STEM education efforts, as there is room for improvement in terms of increasing skilled immigration and levels of professional employment.

The United States ranks lower than Italy and Germany in R&D personnel and lower than Germany in R&D intensity (Innovation Capacity). ITIF recognized the significance of the CHIPS and Science Act in stimulating R&D investments; the report predicts it will mitigate disparities in innovation and economic growth, creating high-paying jobs in areas struggling in the innovation economy.

As efforts in innovation continue, strategies focused on the knowledge economy and globalization may strengthen existing policies from the CHIPS Act.