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With an increase of 3.5%, the mechanical engineering sector is above the average increase in the industry, said Hartmut Rauen , deputy managing director of the German Engineering Federation (VDMA). A look at the employment statistics shows that even in the age of Industry 4.0 qualified people make the difference. The number of employees in research and development grew by about 1,200 to 44,464 between 2015 and 2016, or an increase of 2.7%. Research contracts rose by 19.3% to hit 655 million euros.

Rauen, however, sees a “research funding dilemma.” Midrange companies – in other words, larger SMEs – are being disadvantaged. Large collaborative projects do not fit into the planning environments of the larger SMEs, and funding opportunities for SMEs are limited. Accordingly, there is a greater likelihood that small and large companies will receive funding. This dilemma must be resolved specifically through tax incentives for research .

The digitalization of the industry is not yet running smoothly, as a recent study by Porsche Consulting shows. Although two thirds of the 50 surveyed engineering companies in Germany, Italy, and Switzerland say they are undertaking digital activities to improve growth, efficiency, and customer experience, 88% are stuck in the pilot phase.