Canada is no longer one of the world’s top 10 most innovative economies, according to the latest Global Innovation Index (GII).
The country fell from 8th place last year to 12th place this year, the only country to drop out of the top 10, noted French business school INSEAD, which compiles the annual survey.
Switzerland came in first -- a title it held in the previous year’s rankings as well -- while Sweden and Singapore came in second and third, respectively.
Canada did rank above some notable economic powerhouses, however, including Germany (15th) and France (24th).
INSEAD noted that Canada’s position fell across a wide swath of categories.
While the country ranked high on such measures as its institutions (second place) and market sophistication (seventh), it scored considerably lower on human capital and research, where it ranked 25th.
That suggests the country is not investing enough in higher education, has too few researchers and and is not spending enough on research and development.
Canada ranked particularly poorly in the number of science and engineering students it graduates, in which the country ranks only 46th in the world.
Canada did even more poorly on the GII’s ecological sustainability index, where it ranked 77th -- the country's worst score in the survey. The data showed inefficient use of energy and a relative lack of environmental certification by Canadian companies.
That Canada lags on innovation is nothing new, but it has been growing as a source of concern for economists and the business community. The Conference Board said in a report last week that Canada’s economy will face long-term challenges if it doesn’t improve on productivity and innovation.
The Organization for Economic Co-Operation and Development (OECD) made similar remarks in a report last month, noting that changing course on something as intangible as “innovation” is no easy task.
The organization called on Canada to increase business investment in R&D; open up “sheltered sectors” of the economy to more competition; and replace “inefficient” tax credits to companies with targeted direct grants.
The Conservative government has shown some concern about the issue, devoting some $1.1 billion in this year's budget to promoting research and development.
Here are the 15 most innovative economies in the world.