We can't afford to trail competitors on innovation

AS VARIOUS research studies have shown, economies that consistently invest in innovation reap the rewards in higher productivity, better jobs and stronger exports.

- DYLAN JONES EVANS

For the UK, innovation matters more than ever and after more than a decade of sluggish productivity, we cannot afford to stand still as competitors improve their economies.

The recent figures on research and development (R&D) expenditure released by the Office for National Statistics show that the picture at the UK level is mixed but broadly positive. Total expenditure on R&D performed in the UK reached £72.6bn in 2023, an increase of £3bn compared with 2022 and £14.3bn more than in 2018, which is the first year for which comparable figures are available.

Business continues to dominate R&D activities, undertaking £50bn (or 69% of the total) while higher education delivered out £17.1bn (24%) and the government sector (including UK Research and Innovation) £4.3bn (6%). Private nonprofit organisations spent £1.1bn or 2% of the total. There was also a healthy pipeline of innovation across sectors, with business expenditure increasing by £1.4bn, higher education by £900m and government by £700m.

Yet if the UK overall is moving in the right direction, the regional story tells us just how unevenly this investment is distributed. The so-called “golden triangle” of London, southeast England and the east of England together accounts for more than half of all R&D in the UK, with London alone seeing a year-on-year increase of over £2bn.