The 2021 NAB Business Innovation Index released today reveals that innovation is on the rise as businesses across Australia make difficult decisions to focus their efforts after a turbulent 2020. After falling to a survey low 51.2 pts at the height of the COVID pandemic, the NAB Business Innovation Index recovered to 53.3 pts in 2021.

With business conditions returning to multi-year highs and ongoing signs of improvement in the economy, innovation in 2021 is being driven by doing things more quickly and cost efficiently. While innovation arising from doing things differently has fallen post the initial COVID spike, it remains the biggest contributor to overall innovation.

Innovation was higher in all states in 2021 with Victoria once again crowned Australia’s most innovative state (up 2.0 pts to 55.7 pts, ahead of SA at 54.5 pts).  Meanwhile, Mining has emerged as the most innovative sector (up 13.2 pts to 58.6 pts), with notable improvements also in Manufacturing, Transport, Storage and Construction.

NAB Group Executive Business & Private Bank, Andrew Irvine, said last year presented many companies with a unique opportunity to take stock and focus their business on the strongest opportunities.

“After years of consistent GDP growth in Australia, the arrival of the pandemic was a real shock to the economic system and to companies across the country. This crisis, however, forced many businesses to clean up their balance sheets, sell off unnecessary stock or equipment and refocus their efforts where the real opportunities for growth lie.” Mr Irvine said.

“The innovation we are seeing now is more concentrated on investing in new equipment or new premises to take advantage of new ideas they developed during 2020. Pivot was a great catchphrase for 2020, but this year is all about doubling down on the opportunity.

“COVID-19 has created new opportunities for growth and those businesses that invest in innovation are likely to outperform post the pandemic.”

“NAB has been lending more than $2.4 billion a month to small businesses since the beginning of the pandemic and it is clear that businesses are finding amazing opportunities to invest in.”

Get the full picture in the NAB Business Innovation Index 2021