Businesses have boosted their spending on research and development by a quarter in the last two years.
Scientists say the increase is encouraging but they are disappointed the government spend on R&D is dropping.
Statistics New Zealand figures show business R&D spending rose to $1.2 billion in 2012, 25 more than in 2010.
However, they also show government research spending fell 5% and the country's total research budget as a proportion of GDP remains lower than many other OECD countries.
The head of the Association of Scientists, Shaun Hendy, says the boost in business research and development is very encouraging and will help broaden and grow the economy.
But Professor Hendy says more should be spent to allow the country to catch up with other advanced economies such as Finland.