Industry Canada 2007 Business Survey

Subgroup Variations

This section presents subgroup variations for the issues explored in this survey. This includes business size, region, age of firm, and location (i.e. rural/urban).

Business Size

For the purposes of this analysis, businesses were grouped as follows:

• Small business: 1-49 employees;
• Medium: 50-199; and
• Large: 200 and above.

Overview

Overall, there were considerable differences based on firm size. Variations often followed a pattern, either increasing or decreasing with firm size or separating small firms from larger ones. Differences were most evident in executives' assessments of the federal government's priorities and performance and their views of issues related to R&D and telecommunications. Small firms were more likely to offer positive ratings of government performance in many priority areas and less apt to be involved in R&D, while executives of larger firms tended to be more satisfied with the telecommunications services in Canada.

Industry Canada Priorities and Performance

In assessing federal government priorities to support businesses in Canada, numerous variations were evident. Executives of small firms were more likely to attribute importance to making government services available online (79% vs. 73% each of larger firms), helping SMEs use the Internet (67% vs. 57–58%), and supporting regional economic development (76% vs. 69–72%). In contrast, executives of large firms were more apt to assign priority to ensuring smarter regulations (83% vs. 74–77%) and encouraging innovation and R&D (88% vs. 83% each of smaller firms).

When the focus shifts to assessing federal government performance in these same areas, executives of small firms stood out. Compared to larger firms, they were more likely to provide positive ratings of government performance vis-à-vis promoting inter-provincial trade (30% vs. 24–25%), supporting commercialization of products and ideas (42% vs. 37–38%), making government services for businesses available online (54% vs. 48–51%), and supporting regional economic development (40% vs. 36–38%). Note that online government services and regional economic development are also two of the three areas which executives of small firms were more apt to consider a priority. Other variations tended to be small and did not follow any pattern.

Turning to perceived and preferred roles of the Government of Canada in the economy, executives of large firms were more inclined to think the government should be a catalyst for innovation (28% vs. 22–23%); however, they were least apt to think it currently plays this role (13% vs. 19–21%). For other potential priorities, differences in perceptions based on firm size were minimal.

Research and Development (R&D)/Science and Technology (S&T)

Not surprisingly, the extent to which firms undertake a moderate amount of R&D activity increased with firm size (from 60% to 83%). In terms of barriers preventing more R&D activity, the importance of money/cost was more salient among medium-sized firms (30% vs. 25% each of the others), while executives of small firms were more likely to say that R&D was not appropriate for their firm (42% vs. 35% each for larger firms). When seeking help with or access to R&D, executives of larger firms were more likely to look inhouse (18–19% vs. 8%) or to hire consultants and experts (9–11% vs. 3%). Additionally, executives of firms employing at least 200 employees were more than twice as likely as smaller ones to identify universities (11% vs. 3–5%). Conversely, the likelihood of pointing to the federal government (9% vs. 6–7%) and financial institutions (8% vs. 1–2%) was highest among the smallest firms.

Turning to perceived benefits of federal government support for R&D, executives of larger firms were more likely to cite most outcomes as benefits to the economy. While they were more apt to identify reducing the brain drain (15% vs. 4–8%), the likelihood of pointing to the following increased with firm size: increased productivity (7–15%) and competition (18–32%), economic/financial benefits (20–28%), and the development of new and better quality products (6–14%). Conversely, the larger the firm, the less inclined executives were to identify improved quality of life a benefit to the economy (8–12%). In terms of their business, executives of larger firms were more likely to see financial gains (19–21% vs. 14%), increased competitiveness (12% vs. 6–7%), and increased company size (8% vs. 26%) as main benefits of federal support for R&D.

Focusing on commercialization, executives of smaller firms were more likely to view Government of Canada investment as a big issue for their firm (21% each vs. 11% of large firms). The larger the firm, the more likely tax incentives were to be an important source of help in terms of transforming ideas/research into marketable products and/or services (from 7% to 19%). Executives of large firms were also more apt to point to financial support (28% vs. 19–24%) and decreased regulations (9% vs. 2–4%) as ways for the government to assist their company with commercialization.

Firm size played a role in the perceived usefulness of government programs aimed at supporting S&T research. The smaller the firm, the more likely executives were to attribute value to providing SMEs with access to government labs and equipment (from 25% to 34%) and providing business, technical and financial assistance (from 28% to 46%). That said, the larger the firm, the more likely executives were to see value in supporting S&T skills development in universities (from 39% to 44%).

Investment

In terms of ensuring responsible public investment in the economy, small firms were more likely to say that investments should be repayable (76% vs. 65–66% of larger firms), regionally equitable (73% vs. 59–64%), and business-government partnership-based (63% vs. 58–60%). Executives of larger firms were least apt to attribute importance to safeguards against political influence (80% vs. 84–87%).

There was just one notable difference related to growth sectors of the economy — executives of larger firm were more inclined to feel that the natural resources sector will experience fast growth in the coming years (22–24% vs. 16% of small firms).

When asked to assign importance to various industries, business leaders of medium-sized firms were least likely to view the automotive (71% vs. 75–77%) and biotechnology (82% vs. 88–89%) industries as important to ensuring a healthy Canadian economy. Conversely, those from smaller firms were more inclined to attribute importance to the aerospace industry (64–66% vs. 60%).

Views on Telecommunications

Overall, executives of larger firms tended to be more satisfied with the various aspects of telecommunications services in Canada. They were more likely to express satisfaction with the degree of technology, product and service innovation (84% vs. 76–79% of smaller firms), the extent of Canadian ownership (76% of medium- and large-sized firms vs. 69% of small firms), and the extent to which the telecommunications system helps Canada to be internationally competitive (79–81% vs. 71%). Conversely, business leaders of large firms were the least apt to be satisfied with access to telecommunications services in rural areas (41% vs. 45–48%).

The larger the executive's firm, the more likely he/she was to prefer a hands-off form of telecom regulation. Specifically, as firm size increased, executives were more likely to prefer that government provide general rules for services and pricing, and intervene only when necessary (from 76% to 87% of large firms), and that telecoms not have to seek government approval for services they offer (from 73% to 84% of large firms).

Region

For the purposes of this analysis, businesses were grouped into the following regions:

• Atlantic;
• Quebec;
• Ontario; and
• West.

Overview

Regional differences were widespread and tended to be pronounced on many issues. While there was no consistent pattern, differences often separated Quebec from the rest of the country. Overall, executives in Quebec tended to offer more positive assessments of government performance, were least likely to engage in R&D, and were most apt to need help with S&T commercialization.

Industry Canada Priorities and Performance

Perceptions of what the Government of Canada should be doing to support businesses in Canada varied by region and sometimes widely, with differences ranging from a low of 7% to a high of 23%. While no consistent patterns emerged, differences often separated Ontario from the rest of the country. Executives in Ontario were the least likely to attribute importance to supporting regional economic development (68% vs. 74% in Quebec, 81% in the West, and 87% in Atlantic Canada), and making government services available online (67% vs. 77–79% in Quebec and Atlantic region, and 89% in the West). In contrast, they were more apt to emphasize promoting a fair and competitive marketplace (90% vs. 72–78% elsewhere), and together with Atlantic Canadians, to view as priorities supporting commercialization (80–81% vs. 74–75%) and promoting sustainable development (81–82% vs. 77%).

The likelihood of assigning priority to smarter regulations was highest in the West (78%) and decreased moving east (from 76% in Ontario to 66% in Atlantic Canada). Having an internationally comparable tax regime was more important in the West (89%) and Ontario (80%), while promoting inter-provincial trade was more of a priority among executives in Quebec (77%) and Atlantic Canada (73%).

Turning to assessments of the government's performance in these areas, executives in Quebec offered the most positive ratings, with three exceptions. Ontario executives were the most likely to say that the government was doing a good job making government services available online (59% vs. 55% Quebec, and 48–49% elsewhere), and supporting commercialization (52% vs. 49% in Quebec, 39% in the Atlantic, and 29% in the West). The likelihood of providing a favourable assessment regarding promoting and maintaining a fair and competitive marketplace increased from West to East (from 22% to 37% in Ontario, 45% in Quebec, and 53% in the Atlantic region).

Perceptions of the government's perceived and preferred roles in the economy varied by region. Executives in Ontario were most likely to see the government as an economic leader or activist (12% vs. 4–7%), while those in Atlantic Canada were most apt to view it as a partner to Canadian business (26% vs. 24% in the West and 12–15% elsewhere). Western executives were significantly more likely to think that the government acts as a catalyst (32% vs. 11–18%). The belief that it currently plays a minimalist role was highest in Quebec (50%) and lowest in the West (32%).

When it came to preferred roles, there was a disconnect: executives in Quebec were most likely to prefer that government act as an economic leader (27% vs. 20–24%), those in the West as a partner (45% vs. 41% in the Atlantic region and 31–35%), and those in Ontario (27%) and Quebec (26%) as a catalyst. Executives in Quebec and Atlantic Canada were the less likely to prefer the government play a minimalist role in the Canadian economy (5% each vs. 10–13%).

Research and Development/Science and Technology

Firms in Quebec were the most likely to have not undertaken any R&D activities at all (44% vs. 34–37%). In terms of barriers preventing more R&D activity, money/cost was more likely to be emphasized in Ontario (28%) and the West (27%), compared to elsewhere (19–23%). Executives in the West were least likely to say that R&D was not appropriate for their firm's activities (36% vs. 42–48% elsewhere) and most apt to report that there are no barriers (14% vs. 9–12%).

Quebec executives were most likely to identify the federal (12% vs. 6–10%) and provincial (16% vs. 3–10%) governments and private companies (9% vs. 1–6%) as sources of assistance. They were also the only executives to not identify in-house resources (0% vs. 9% in Ontario and 12% in Atlantic Canada and the West), universities (0% vs. 4% each in the Atlantic and West and 10% in Ontario), or the Internet (0% vs. 5–8% elsewhere). Executives in the Atlantic region were most apt to identify trade associations (13% vs. 57% elsewhere).

In terms of perceived benefits of federal R&D support, business leaders in Quebec were most likely to see improved quality of life as the main benefit to the economy (21% vs. 712%). Increased competitiveness was more salient among Ontario executives (25% vs. 20% in Quebec, and 12–17% elsewhere), while Ontario and Atlantic executives were more likely to point to reduced brain drain (11–14% vs. 2–7%) and increased productivity (12% each vs. 3–4%). When the focus shifts to their own business, executives in Quebec and the West were much more likely than others to point to financial benefits (20% each vs. 612%). Additionally, compared to executives in other regions, those in Quebec were more inclined to cite all of the other top benefits to their business: financing options, creating new products, retaining skilled workers and increasing the size of their company.

Turing to commercialization, executives in Quebec were more likely to view this type of assistance as an issue for their firm (57% vs. 45% in Ontario and 28–31%). Not unexpectedly, they were the most likely to suggest that financial support would be the best way to help them commercialize their ideas and products (36% vs. 26% in Ontario, and 17% elsewhere). Those in Ontario and the Atlantic region were more likely than others to suggest tax incentives (12% vs. 7% or less).

Distinct regional differences were evident in terms of the initiatives the federal government could take to support businesses undertaking S&T activities. Atlantic executives were more likely to say that providing SMEs with access to government labs and equipment (54% vs. 48–51%) would be valuable to their industry, as well as encouraging businesses to work with universities (69% vs. 57–59%) and supporting S&T skills development (69% vs. 63% in the West and 54–58% in Quebec and Ontario). Quebec executives were slightly more inclined to attribute value to government tax credits for S&T research (62% vs. 57–59%), while those in Ontario were much less likely to see value in government providing business, technical and financial support to SMEs (56% vs. 64–65%).

Compared to elsewhere in Canada, business leaders in the Atlantic region (60%) and Quebec (60%) were more likely to be at least moderately interested in receiving information on government S&T programs (vs. 44–48% in Ontario and the West).

Investment

In terms of ensuring responsible public investments in the economy, making investments repayable was similarly important in all regions, except the West, where it was considered more important (71–73% vs. 78%). With the exception of Ontario, executives also held similar views on basing investments on independent expert recommendations (77–81% vs. 68%). Business leaders in Quebec and the Atlantic region were more likely to attribute importance to requiring partnerships (70% each vs. 59–61%) and ensuring equitable regional distribution (78–81% vs. 73% in the West and 65% in Ontario). Clear reporting of investments was more important among Ontario and Atlantic executives (87–88% vs. 82–83%), while safeguards against political influence were of lesser importance in Atlantic Canada than elsewhere (78% vs. 84–86%).

Business leaders in Quebec and Atlantic Canada were more likely to expect the information technology sector to grow fastest over the next few years (23% each vs. 14% in Ontario, and 6% in the West). Conversely, executives in the West and Ontario were more apt to expect the communications technology sector to grow quickly (10–11% vs. 7% in Quebec and 2% in Atlantic Canada). As well, executives in the West were also much more likely to point to natural resources as a growth sector (29% vs. 19% in Atlantic Canada, 11% in Quebec and 7% in Ontario).

In terms of industries that are important to ensuring a healthy Canadian economy, significant regional differences were evident in two areas. Executives in Ontario and Atlantic Canada were more likely to attribute importance to the automotive industry (83–85% vs. 75% in Quebec and 66% in the West), while the aerospace industry was more likely to be important to Quebec (76%) and Atlantic Canada (72%) executives (compared to 66% in the West and 55% in Ontario).

Views on Telecommunications

Focusing on telecommunications services in Canada, executives in the West and Quebec were more likely to express satisfaction with rural access to telecommunications services (52–54% vs. 43% in the Atlantic region and 34% in Ontario). Executives in Atlantic Canada were the most likely to be satisfied that the telecommunications system helps Canada to compete internationally (76% vs. 70–72%) and that there are strong Canadian-owned telecommunications companies (78% vs. 67–71%). Business leaders outside Quebec held similar views on the degree of technology and product innovation (79–80% vs. 75% in Quebec), while those outside Ontario were similarly likely to express satisfaction with Canadian-based R&D (70–73% vs. 64% in Ontario).

Executives in the West and Ontario share similar views on regulating telecommunications. They were more likely to think government should provide general rules and rely on oversight and competition for the best mix of service and pricing (79–81% vs. 66–68%) and to prefer that telecom services be offered to consumers without first seeking government approval (85% in the West, and 72% in Ontario vs. 69% in Atlantic Canada and 58% in Quebec).

Age of firm

For the purposes of this analysis, businesses were grouped as follows:

• 1–10 years old ('young firms');
• 11–20 years old ('medium firms');
• 21–40 years old ('old firms'); and
• Over 40 years old ('oldest firms') Overview

Overview

Differences based on the age of firms were widespread and pronounced at times. While they did not follow a regular pattern, differences often separated older firms from younger ones. This was particularly evident with respect to government priorities and performance. Only occasionally did differences increase or decrease with age of firm.

Industry Canada Priorities and Performance

Firm age had an impact on executives' views vis-à-vis government priorities. Executives of the oldest firms (i.e. those over 40 years) were more likely than others to attribute priority to many of the areas examined, including:

• Encouraging innovation (96% vs. 75% of young firms and 84–85% of others);
• A competitive tax regime (95% vs. 84% of young firms, and 73–78% of others);
• A fair and competitive marketplace (89% vs. 78–82%);
• Promoting sustainable development (88% vs. 72% of young firms and 80–83% or others);
• Making government services available online (88% vs. 67% in old firms, and 8083% of others); and
• Ensuring smarter regulations (86% vs. 72–77%).

Business leaders in old firms (i.e. 21–40 years) were the least likely to view as important priorities supporting commercialization (67% vs. 78–83%) and encouraging investment (78% vs. 86–88%). Helping SMEs take advantage of the Internet was more likely to be a priority for executives of young firms (75% vs. 61–68%), while promoting inter-provincial trade was more important for those working for medium-aged firms (i.e. 11–20 years) (71% vs. 53% of young firms and 62–66% of others).

When assessing government performance in these same areas, subgroup variations were notable but did not follow a consistent pattern. Young firms were less likely to provide positive ratings of the government's efforts to help SMEs take advantage of the Internet (20% vs. 30–35%) and to promote a fair and competitive marketplace (28% vs. 36–40%). Executives of medium firms were less likely to feel that the government is doing a good job supporting commercialization (38% vs. 42–44%). The government's performance regarding a competitive tax regime was most likely to be viewed positively by executives of medium and old firms (i.e. between the ages of 11-40) (24–27% vs. 12–19%), while its performance in supporting regional economic development was viewed most positively by executives from medium-age and the oldest firms (46% vs. 36–37% of others). The likelihood of providing positive assessments increased with firm age for the following: ensuring smarter regulations (19–36%), promoting sustainable development (23–42%), and encouraging investment (29–48%). As well, executives of the oldest firms were more likely to give favourable evaluations of government performance in the all other priority areas.

Turning to the government's role in the economy, those from the oldest firms were most likely to think the government is currently acting as a partner to business (30% vs. 12% of old firms and 19–21% of others). Executives of medium-aged firms were the least apt to believe the government is playing a minimalist role (36% vs. 40–45%). When the focus shifts to the preferred role of government, executives from older firms (i.e. those in operation for over 20 years) were more likely to think it should be a partner to business (43–44% vs. 31–37% of younger firms), while the perception that it should be an economic leader was more likely to be held by executives of medium-aged firms (30% vs. 12% of old firms and 23–26%).

Research and Development/Science and Technology

The oldest firms were the least likely to undertake R&D (26% vs. 35–41%). Money/cost was a more important barrier to increased R&D activity among executives of young firms (33% vs. 16–25%). Executives of young firms were less likely to say that R&D was not appropriate for their firm (35% vs. 41–44%), while the likelihood of reporting no R&D barriers increased with the age of the firm (from 8% to 21%). For help with or access to R&D, executives from medium-aged firms were the most likely to turn to the National Research Council (10% vs. 2% of others). Those from the oldest firms were more apt to use in-house resources (18% vs. 2–12% of others) and the Internet (17% vs. 3–7%), while they were less likely than younger firms (i.e. those in business for up to 40 years) to cite the federal (2% vs. 8–12%) or provincial (1% vs. 4–10%) governments and business/trade associations (2% vs. 6–10%).

When it came to the main benefits of federal support for R&D, business leaders from the oldest firms were more likely to identify reduced brain drain (22% vs. 12% of young firms and 2–4% of others), increased competitiveness (29% vs. 17–19%), and new or better quality products (15% vs. 4–7%). The older the firm, the less likely its executives were to identify economic benefits (from 23% to 8%). Similarly, the likelihood of thinking that financial benefits would flow to their business from federal R&D support decreased as firm age increased (from 17% to 12%). That said, executives of the oldest firms were most likely to believe there would be no benefits (61% vs. 44–51%).

With the exception of executives of old firms (i.e. 21-40 years) (29%), the likelihood of considering commercialization an issue did not vary much by age (42–45%). Overall, executives of younger firms were more likely to view financial support as the best way for the government to help their company transform ideas/research into marketable products or services (28–32% vs. 11–16% of older firms). Conversely, business leaders working for old firms were more likely to suggest knowledgeable assistance (14% vs. 8% or less), while executives of the oldest firms were least likely to point to tax incentives (1% vs. 7–10%).

Focusing on federal government initiatives designed to support businesses that undertake S&T activities, executives of old firms were more likely to attribute value to encouraging business-post-secondary partnerships (64% vs. 51–59% of others). Executives of the youngest firms were more apt to consider important business, technical and financial help for SMEs (76% vs. 53–61%) and government tax credits for S&T research (68% vs. 63% of old firms vs. 47–52%). Supporting S&T skills development (48% vs. 54–68%) and providing SME access to government facilities (40% vs. 49–53%) were much less likely to be viewed as valuable initiatives by executives of the oldest firms.

Executives of the oldest firms were the least likely to be interested in receiving information about government S&T programs targeted at businesses (35% vs. 44% of old firms, and 54–57% of others).

Investment

In terms of ensuring responsible public investment in the economy, measures that executives deemed important varied significantly. Those from medium-aged and the oldest firms were more likely than others to attribute importance to clear reporting (90–91% vs. 82–84%) and basing decisions on independent expert recommendations (82–83% vs. 72–73%). The older the firm, the more likely executives were to assign importance to equitable regional distribution (from 61% to 77%) and safeguards against political influence (from 83% to 91%). Making investments repayable (82% vs. 72–77%) and requiring partnerships with government were more important to executives of the oldest firms (77% vs. 56–69% of others).

Executives of younger firms were more likely to expect the natural resources (18–20% vs. 11–14%), information technology (19% vs. 8–15%), and communication technology (11% vs. 3–9%) sectors to experience the fastest growth in the coming years. When assessing the importance of various industries to a healthy Canadian economy, executives of medium-aged firms were the most likely to attribute importance to the biotechnology (93% vs. 84–89%) and aerospace (77% vs. 61–62%) industries. The most established, or oldest, firms felt that the ICT or telecommunications (98% vs. 89–95%) and the automotive (86% vs. 66–82%) industries are of the most value to the economy.

Views on Telecommunications

Satisfaction with aspects of the telecommunications industry in Canada varied considerably by age of firm. Executives of the two middle aged groups were the most likely to be satisfied with the level of Canadian based R&D (69–73% vs. 64–66%) and rural access to telecommunications services (48–49% vs. 41–45%). Business leaders of medium-aged firms were also more likely to be satisfied that there are strong Canadian-owned telecommunications firms (78% vs. 63–72% of others), while those of the oldest firms (84% vs. 64–77%) were more likely to be satisfied that the telecommunications system helps the Canadian economy compete with the world. As firms increased in age, executives were more likely to express satisfaction with the degree of technology and product innovation (from 71% to 92%).

In terms of approaches to regulation, the proportion of executives who preferred that the government provide only general rules for service delivery and rely on market forces ranged from 66% among medium-aged firms to 92% among the oldest firms. The likelihood of preferring that telecommunications services be offered without prior government approval was fairly similar regardless of firm age.

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Location

For the purposes of this analysis, the comparison is between businesses located in urban and rural (smaller urban) areas of the country. Postal codes were used to determine location. The second letter of each postal code indicates whether the business is located in an urban or rural area of the country.

Differences based on firm location were evident in all areas but were most pronounced concerning government priorities and performance, and R&D/S&T issues. Executives of rural firms were more likely to view as important many of the priority areas and to provide positive ratings of the government performance in all areas. In addition, compared to urban executives, those located in rural areas were more likely to say their firm undertakes R&D activities and to view commercialization assistance as an issue for their firm.

Industry Canada Priorities and Performance

Executives, regardless of location, attributed similar levels of importance to the potential priorities of making government services accessible online, promoting and maintaining a fair and competitive marketplace, ensuring smarter regulations, having a tax regime for businesses comparable to Canada's competitors, and helping SMEs take advantage of the Internet. Beyond that, there were significant differences between executives from urban and rural firms. Executives in rural firms were more likely, and sometimes much more likely, to assign priority to the following:

• Promoting sustainable development (91% vs. 77%);
• Encouraging investment in the economy (89% vs. 84%);
• Encouraging innovation and R&D (88% vs. 82%);
• Supporting regional economic development (83% vs. 73%);
• Supporting commercialization efforts (82% vs. 78%): and
• Promoting inter-provincial trade (78% vs. 59%).

Executives in rural areas were also more likely to provide positive assessments of the government's performance in all areas. Differences were most pronounced for making government services accessible online (71% vs. 49%), helping SMEs use the Internet (57% vs. 19%), supporting regional economic development (53% vs. 35%), and promoting /maintaining a fair and competitive marketplace (47% vs. 29%). In addition, rural executives were more likely to offer favourable ratings for the following:

• Encouraging innovation and R&D (53% vs. 40%);
• Investment in the economy (48% vs. 32%);
• Supporting commercialization efforts (49% vs. 40%):
• Promoting sustainable development (42% vs. 27%);
• Ensuring smarter regulations (38% vs. 24%);
• Promoting inter-provincial trade (34% vs. 29%); and
• Having an internationally comparable business tax regime (33% vs. 20%).

Turning to the role of the federal government in the economy, there is an obvious disconnect between perceptions and preferences. Executives in urban firms were more likely to think the government currently plays a minimalist role (43% vs. 37%) or acts as a partner to Canadian business (21% vs. 15%). Conversely, those in rural firms were more likely to view the government as a catalyst for innovation (24% vs. 18%). Focusing on preferences, executives in urban firms were more likely to prefer the role of catalyst (23% vs. 20%), while those in rural firms were more likely to prefer the government assume the role of partner (45% vs. 38%).

Research and Development/Science and Technology

Rural firms were much more likely to undertake at least moderate R&D activities (58% vs. 34%). In terms of barriers preventing more R&D activity, money/cost was equally important to executives in urban and rural firms (26–27%). Executives in rural firms were more likely to say that R&D was not appropriate for their firm (43% vs. 38%). To obtain help with or access to R&D, business leaders in rural firms were considerably more likely to say they would go to trade associations (20% vs. 4%) and the provincial government (10% vs. 5%). Conversely, those working in urban firms were more apt to consult a financial institution (11% vs. 4%) or to use the Internet (7% vs. 3%).

In terms of the main perceived benefits of federal support for R&D, executives in rural firms were more likely to cite improved quality of life (14% vs. 9%). Urban executives, on the other hand, were slightly more apt to point to economic/financial benefits (21% vs. 17%) and increased competitiveness (19% vs. 15%). Focusing on benefits to their company, rural executives were much more likely to point to financial benefits (22% vs. 12%), financing options (10% vs. 3%), and creating new products (9% vs. 4%).

Executives in rural firms were more inclined to view commercialization assistance as an issue for their firm (48% vs. 37%). Thinking about the best way for the government to help them in this area, rural executives were more likely to suggest financial support (31% vs. 24%), knowledgeable assistance (13% vs. 4%), and decreased regulation (10% vs. 3%). Interestingly, they were also more likely to say that their firm did not need government assistance transforming ideas/research into marketable products or services (16% vs. 5%).

The federal government's initiatives aimed at supporting businesses that undertake S&T activities were more likely to appeal to executives working for rural firms. These executives were more apt to attribute value to all the initiatives: providing business, technical/financial assistance (74% vs. 59%), supporting S&T skills development (72% vs. 57%), encouraging partnerships (69% vs. 56%), offering government tax credits for S&T (64% vs. 58%), and providing access to government labs (58% vs. 47%). In addition, the majority of executives from rural firms (60%) were interested in receiving information on Government of Canada S&T programs for businesses (compared to 47% of urban firms).

Investment

In terms of ensuring responsible public investment in the economy, executives, regardless of location, were similarly likely to attribute importance to clear reporting, safeguards from political influence, basing decisions on the recommendations of independent experts, and requiring partnerships. That said, executives of rural firms were more apt to view as important making investments repayable (85% vs. 75%), while those in urban firms felt this way about equitable regional distribution (74% vs. 70%).

Executives in urban firms were more likely to predict fast-paced growth for the natural resources (21% vs. 9%), communications technology (10% vs. 4%), and health-care (8% vs. 4%) sectors of the economy. They were also slightly more apt to say that the ICT industry is important for ensuring a healthy Canadian economy (94% vs. 89%). Rural executives were more inclined to attribute importance to the aerospace (71% vs. 61%) and automotive (79% vs. 74%) industries.

Views on Telecommunications

A few differences warrant mention. Executives of rural firms were more likely to express satisfaction with the level of rural access to telecommunications service (55% vs. 44%). Conversely, urban executives were more apt to be satisfied with Canadian-based R&D (73% vs. 68%) and the competitiveness of the economy that results from the telecom industry (76% vs. 66%). When thinking about regulation, rural executives were more apt to prefer that telecommunications firms be allowed to offer service without prior government approval (81% vs. 74%).

Characteristics of Survey Participants

This section presents the characteristics of survey participants and their businesses, including position and language of respondent, size of firm, age of firm, sector, region and urban-rural location.

Position (unweighted data)

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Language (unweighted data)

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Number of Full-Time Employees (unweighted data)

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Age of Business (unweighted data)

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Sector (unweighted data)

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Region (unweighted data)

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Location (unweighted data)

Appendix

Detailed Note on Weighting

The final weighting scheme used for the survey was based on business size and region. The sample was weighted to correspond with the distribution of businesses according to Statistics Canada's Canadian Business Patterns (June 2006). The Statistics Canada "Indeterminate" category¹⁰ of businesses was excluded from the size distributions used to weight the survey data. Weighting by business size and region is important because size-based and region-based quotas were used to govern the data collection. Following this note is a design note that presents the sample frame for the survey.

Since quotas were used for both business size and region to guide the data collection, the process of applying weights was undertaken in multiple stages. First, the data were weighted to ensure that the results within each region were reflective of the distribution of businesses by size and sub-region in each region (e.g. for Atlantic Canada, ensuring that the weights reflects the distribution of businesses within this region by size and province). In this way, regional analyses were more accurate. Following this, efforts were taken to ensure that the overall, aggregate data were representative of the national distribution of business by size and region for the country as a whole.

Business Size

Categories	Actual Population*		Unweighted Survey Data		Weighted Survey Data
	N	%	N	%	%
*Source: Statistics Canada, Canadian Business Patterns, June 2006
Indeterminate Excluded	1255404
1 to 4	613820	57%	104	13%	57%
5 to 19	306213	29%	137	17%	29%
20 to 49	91640	9%	77	10%	9%
50 to 199	475492	4%	268	33%	4%
200 to 499	7769	1%	90	11%	1%
500+	3151	0%	130	16%	0%
DK/NR	–	–	2	0%	–
	1,070,139	100%	808	100%	100%

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¹⁰ The "Indeterminate" category includes businesses that do not maintain an employee payroll, but may have a workforce that consists of contracted workers, family members or business owners, and businesses that did not have employees in the last 12 months.

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Region

	Actual Population*		Unweighted Survey Data		Weighted Survey Data
Indeterminate Excluded	N	%	N	%	%
*Source: Statistics Canada, Canadian Business Patterns, June 2006
Province
British Columbia	167809	16%	88	11%	16%
Alberta	147803	14%	92	11%	14%
Saskatchewan	39191	4%	30	4%	4%
Manitoba	35633	3%	21	3%	3%
Ontario	356619	33%	217	27%	33%
Quebec	239311	22%	171	21%	22%
New Brunswick	26155	2%	52	6%	2%
Nova Scotia/P.E.I.	36774	3%	101	13%	3%
Newfoundland/Labrador	16909	2%	36	4%	2%
YT	1597	0%	-	-	0%
NWT	1714	0%	-	-	0%
Nunavut	624	0%	-	-	0%
Region
West	394371	37%	231	29%	37%
Ontario	356619	33%	217	27%	33%
Quebec	239311	22%	171	21%	22%
Atlantic Canada	79838	8%	189	23%	7%
Total	1070139	100%	808	100%	100%

The sample was also reviewed for sector distribution. As the tables below reveal, the sectoral distribution is close to the Statistics Canada data, although some variations are evident as would be expected

Sector

	Actual Population*		Survey Data*
Indeterminate Excluded	N	%	N	%
*Source: Statistics Canada, Canadian Business Patterns, June 2006
Accommodation/Food Services	74140	7%	89	11%
Administrative/Support	49974	5%	5	1%
Agriculture/Forestry	56961	5%	42	5%
Arts/Entertainment/Recreation	18608	2%	34	4%
Construction	119459	11%	52	6%
Educational Services	12190	1%	–	–
Finance and Insurance	39231	4%	42	5%
Health Care/Social Ass.	84595	8%	5	1%
Inform/Cultural Industry	13941	1%	14	2%
Management of Companies	13405	1%	5	1%
Manufacturing	60766	6%	140	17%
Mining/Oil, Gas Extraction	9374	1%	32	4%
Other Services	96688	9%	111	14%
Professional/Scientific/Technical	122247	11%	52	6%
Public Administration	7975	1%	–	–
Real Estate	42850	4%	20	2%
Registered charity		0%	–	–
Retail Trade	134372	13%	83	10%
Transportation/Warehousing	48062	4%	47	6%
Utilities	1369	0%	5	1%
Wholesale Trade	63932	6%	29	4%
DK/NR		0%	1	0%
Total	1070139	100%	808	100%

Industry Canada 2007 Business Survey

Hello, may I speak to ________________. (Use contact name/position from list)

• If person is available, continue.
• If not available, schedule call-back. If needed, explain purpose of the study (use introduction).

Hello, my name is ________. I'm calling on behalf of Phoenix, a public opinion research company. We've been commissioned by the Government of Canada to conduct a survey with senior corporate executives. The purpose is to explore the perceptions of business leaders on a number of important issues facing businesses and the Canadian economy. The survey is registered with the national survey registration system.

Would you be willing to take part in this survey? Your participation is voluntary, but would be extremely valuable. The findings will be used to help the Government of Canada better understand the needs of businesses, and to develop effective policies and programs that meet those needs. All responses will be kept entirely confidential. We can do the survey now or at a time more convenient for you.

• Yes, now (Continue)
• Yes, call later. Specify date/time:     Date:          Time:
• Refused (Thank and discontinue)

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Interviewer notes:

Participants must be the owner, CEO, president or senior decision maker/ executive for small firms, and vice-presidents or senior executives responsible for government relations/ public affairs/operations for medium-sized and large firms. Ask for appropriate referral if respondent does not fit criteria or discontinue interview.

If respondent asks about the length of the survey, inform him/her it is should take no more than 20 minutes.

If respondent questions the validity of the survey, ask him/her to call Lynn Patry of the Government of Canada at 613-948-1549 (or have Lynn call the respondent).

If respondent asks about national survey registration system, say:
The registration system has been created by the survey research industry to allow the public to verify that a survey is legitimate, get information about the survey industry or register a complaint. The registration system's toll-free phone number is 1-800-554-9996.

Participants' comments will be protected in accordance with the provisions of the Privacy Act. Indicate this if relevant. Also say if relevant: "Your responses to this survey will have no impact on your dealings with the Government of Canada".

Some questions are tracking questions that were used in earlier surveys, including the Industry Canada baseline survey (2002), The follow-up survey (2004), Or an SME information needs survey (2001). Tracking questions are identified as follows: T04 = tracking (t) from 2004 business survey.

Headings in blue should not be read to respondents

For all questions, include 'Don't Know/No Response' option

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1. Before we start, could you please confirm for me your position within your company or business? (Do not read list; see study requirements; ask for referral to appropriate executive if necessary) T02 / T04

• President/CEO
• Owner
• VP Public Affairs/Government Relations/Operations
• General manager (small business)
• Other (specify): ______________________

2. How many employees work for your company in Canada? By this, we mean both full-time and part-time staff. Please include part-time staff as the number of full-time equivalents. (Read list if helpful) (Note: Does not include contract staff or outsourced work) (Includes all locations in Canada) T02 / T04

• One (i.e. self employed)
• 2-4
• 5-9
• 10-19
• 20-49
• 50-199
• 200-499
• 500 and above

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Industry Canada Priorities and Performance

The Government Canada has identified a number of potential priorities it can pursue to support businesses in Canada. For each of the following, please tell me how much emphasis you think should be placed on that particular area. Please use a 7-point scale, where '1' means the lowest priority, and '7' the highest priority. How about...? (Rotate) T02 / T04

3. Encouraging innovation and research and development among Canadian businesses.

4. Promoting and maintaining a fair and competitive marketplace.

5. Supporting the commercialization or market success of products and services that are researched or developed in Canada.

6. Supporting regional economic development.

7. Encouraging investment in the economy and Canadian businesses.

8. Helping small and medium-sized companies take advantage of the Internet and e-business opportunities.

9. Making government services for business readily accessible on the Internet.

10. Ensuring smarter regulations to contribute to economic and business growth.

11. Promoting sustainable development — that is, achieving a balance between economic growth and environmental impact.

12. Promoting inter-provincial trade.

13. Having a tax regime for business comparable to those of Canada's international competitors.

How would you rate the performance of the Government of Canada in each of these same areas? Please use a similar 7-point scale, where '1' means a very poor job, and '7' a very good job. How about...? (Rotate) (If respondent has no knowledge or basis for making judgement; accept 'don't know' and do not require other response, but don't encourage this) T02 / T04

14. Encouraging innovation and research and development among Canadian businesses.

15. Promoting and maintaining a fair and competitive marketplace.

16. Supporting the commercialization or market success of products and services that are researched or developed in Canada.

17. Supporting regional economic development.

18. Encouraging investment in the economy and Canadian businesses.

19. Helping small and medium-sized companies take advantage of the Internet and e-business opportunities.

20. Making government services for business readily accessible on the Internet.

21. Ensuring smarter regulations to contribute to economic and business growth.

22. Promoting sustainable development — that is achieving a balance between economic growth and environmental impact.

23. Promoting inter-provincial trade.

24. Having a tax regime for business comparable to those of Canada's international competitors.

25. In your view, what is the main role the federal government currently plays in the Canadian economy? Is it that of...? (Read list; do not rotate; accept one response) T02 / T04

• One…an economic leader or activist,
• Two…a partner to Canadian business,
• Three…a catalyst to support innovation,
• Four…a minimalist role, or
• Five…some other role. If so, please specify: _________________
• No role (Volunteered)

26. And what role do you think the federal government should play in the Canadian economy? Should it be that of...? (Read list; do not rotate; accept one response) T02 / T04

• One…an economic leader or activist,
• Two…a partner to Canadian business,
• Three…a catalyst to support innovation,
• Four…a minimalist role, or
• Five…some other role. If so, please specify: _________________
• No role (Volunteered)

Research and Development / Science and Technology

Turning now to research and development, usually referred to as R&D,

27. To what extent does your business undertake R&D activities to improve your products, services or business processes? Would you say a great deal, a moderate amount, only a little, or not at all? T02 / T04

28. What barriers or obstacles, if any, prevent your firm from being more active in R&D? (Do not read list; accept two responses) T02 / T04

• None/no barriers
• Not appropriate for firm's products/services
• Money/cost
• Lack of time
• Lack of interest
• Lack of information
• Lack of expertise/necessary skills
• Market barriers
• Other (specify) _____________

If person says 'Not appropriate for firm' / 'Lack of interest' at Q28, skip Q29.

29. Where would your business go if you needed help with or access to R&D? (Do not read list; Accept one response) T02 / T04

• Business/trade association
• Federal government
• In-house
• Private company
• Provincial government
• Internet (Probe for specifics: _____________)
• National Research Council (NRC)
• Bank/financial institution
• Hire consultants/experts
• Suppliers
• Universities
• Technology Partnerships Canada
• Canadian Technology Networks
• Networks of Centres of Excellence
• Industrial Research Assistance Program
• Industrial or commercialization clusters (e.g. technology and talent groupings at public/private facilities including the NRC, CRC, MARS…)
• Other (specify)

30. In your view, what are the main benefits of federal government support for R&D to Canada and Canada's economy? Anything else? (Do not read list. Record first response. Accept multiple responses) T02 / T04 Modified

• Improved quality of life/standard of living of Canadians
• Increased competitiveness of Canadian firms/more globally competitive
• General economic benefits (Probe for specifics: _____________)
• Increased productivity of Canadian businesses
• Create new businesses
• Reduce brain drain/keep jobs in Canada
• Financial benefits
• Opening new markets
• Nothing/no benefits
• Other (specify): _____________

31. And what do you think are the main benefits of federal government support for R&D to your business? Anything else? (Do not read list. Record first response. Accept multiple responses)

• Financial benefits (increased revenues/profits)
• Financing options
• Create new products/services
• Retain skilled employees
• Increase size of company
• Create new spin-off businesses
• Tax breaks
• Nothing/no benefits
• Other (specify): _____________

If person said 'Not appropriate for firm'/ 'Lack of interest'/ at Q28, skip Q32-33

32. To what extent does your company need help transforming ideas or research into marketable products or services? Please use a 7-point scale, where '1' means it is not an issue at all for your company, and '7' means it is a very big issue. T04

33. What would be the best way for the Government of Canada to help your company transform ideas or research into marketable products or services? (Do not read list. Accept one response)

• Provide financial support
• Provide 'how to' information
• Help locate buyers/customers for new products/services
• Facilitate partnerships (Probe for specifics:_____________)
• Encourage commercialization clusters (e.g. MARS)
• Efficient marketplace regulations (patents, copyright)
• Tax incentives
• Other (specify) _____________
• Don't know / No response

I'd like to turn to issues related to science and technology, often referred to as S&T.

There are a number of initiatives targeting Canadian businesses that the Government of Canada could take or is already taking to support businesses that undertake S&T activities. Please tell me how valuable you think each of the following would be to your industry. To do this, use a 7-point scale, where '1' means not valuable at all, and '7' means very valuable. How about …? (Read/Rotate list)*

34. Government tax credits for businesses who undertake research in a field of science or technology. (Note to reviewers: This program is known as Scientific Research And Experimental Development Tax Credit or SRED)

35. Government providing business and technical advice, as well as financial support to small and medium-sized businesses who have new products they would like to bring to market (Note to reviewers: This program is known as the Industrial Research Assistance Program or IRAP)

36. Providing small and medium-sized businesses with access to government labs and equipment to carry out research and development on new high technology products and allowing these companies to have access to world-class researchers for advice. (Note to reviewers: This program is known as the Communications Research Centre Canada (CRC) and NRC Labs and centers)

37. Government encouraging businesses to work with Canadian universities and colleges for the development of technology.

38. Government supporting the development of science and technology skills in businesses, colleges and universities.

39. To what extent would your company be interested in receiving information on Government of Canada S&T programs targeted at businesses? Would you say very interested, moderately, not very or not interested at all?

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Views on Federal Government Investments in Canadian Economy

Turning now to investments in the Canadian economy and businesses, when the Government of Canada invests public funds in the economy, what level of importance would you place on each of the following to ensure responsible investment? Please use a 7-point scale, where '1' is not important at all, and '7' is very important. How about…? (Rotate) T02 / T04

40. Requiring partnerships with business and other levels of government.

41. Clear reporting of the investments and the anticipated results.

42. Investments in individual companies to be repayable.

43. Decisions on investments to be based on recommendations from independent experts.

44. Equitable regional distribution.

45. Safeguards against political influence on where investments would go.

46. In your view, which sector of the economy will experience the fastest growth over the next few years? (Do not read list; Accept one response) TF94 / T02

• Communications technologies Information technologies/systems
• Biotechnology
• Restaurant and food services
• Environmental technologies and services
• Knowledge-based services such as financial and consulting services
• Tourism
• Aerospace
• Agriculture/agri-food
• Hydro-electric power equipment/services
• Entertainment
• Health-care/therapeutic products
• Retail
• Construction
• Other (specify)________

Please tell me how important you feel each of the following industries are to ensuring that Canada's economy is healthy in the future. For each, please tell me if you feel it is very important that Canada succeeds in this sector, important, not all that important, or not important at all. How about…? (Read and rotate) (Modified: Tracking: Canadian Aerospace Partnership Research, Fall 2005)

47. The Automotive industry

48. The Aerospace industry

49. The Information Communications Technology (ICT) or Telecommunications industry

50. The biotechnology industry

51. The natural resources sector

52. The Environmental technologies industry

Views on Telecommunications

Turning now to telecommunications, (TF05 — Tracking; asked in Decima Survey)

Please tell me whether you are very satisfied, satisfied, dissatisfied or very dissatisfied with the following aspects of telecommunications services in Canada today. How about…? (Read/Rotate list)

53. A high degree of technology, product and service innovation.

54. Strong Canadian owned telecommunications companies.

55. Access in rural areas to the telecom services that people need.

56. Canadian-based research and development on new telecom technologies.

57. A telecom system that helps our economy compete with the rest of the world.

The Government of Canada can choose different approaches to meet its goals. I will present two situations to you, each one involving two different approaches. Please tell me which approach you would prefer:

58. Government should have detailed rules that spell out what services telecommunications companies can and can't offer and the prices they can charge or… Government should provide general rules and rely on oversight and competition in the marketplace to produce the best mix of services and pricing.

59. Whenever a company wants to introduce a new telecommunications service into the marketplace it should be approved by, and have its price set by, government before it can be offered to customers, or …Telecommunications services should be offered to customers without prior government approval, as long as government has the ability to oversee the market and intervene to make changes when necessary.

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Respondent/Corporate Characteristics

I have two last questions for statistical purposes. Please remember that your responses to these and other questions will be kept confidential.

60. Approximately how many years has your business been in operation? T02 / T04

Record year: _________________

61. In which industry or sector does your business operate? If you are active in more than one sector, please identify the main sector. (Do not read list; Accept one response) T02 / T04

• Agriculture/Fishing/Hunting/Forestry
• Oil/Gas/Mining
• Utilities
• Construction
• Manufacturing
• Wholesale Trade
• Retail Trade
• Transportation and Warehousing
• Information and Cultural Industries
• Finance and Insurance
• Real Estate and Rental/Leasing
• Professional, Scientific and Technical Services
• Management of Companies and Enterprises
• Administrative and Support, Waste Management, Remediation Services
• Art, Entertainment, Recreation
• Accommodation and Food Services
• Other (specify) ____________________

That completes the survey. Thank you very much for taking part.

Record Through Observation/Database:

• Gender
• Province
• Urban vs. rural location
• Language