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INDUSTRY NEWS

Rise in R&D spending can’t

hide flat progress since 1990

THE LATEST FIGURES FOR R&D EXPENDITURE SHOW A £2.3BN RISE numbers (from 2018) do not yet take into account the
TO £37.1BN IN 2018. THIS EQUATES TO 1.71% OF GDP. WHILE THIS impact of Brexit, relevant as a large proportion of R&D
funding comes from abroad.”
SEEMS PROMISING, PROGRESS HAS REMAINED FLAT OVER 30 YEARS Karl Barnfather, chairman of European intellectual
property firm Withers and Rogers, added: “The headline
esearch and development (R&D) expenditure estimate of 1.71% of GDP was up from 1.67% in 2017 figures highlight the strides that have been taken to
rose by £2.3 billion to £37.1 billion in 2018; and above the average of 1.61% for the period 2005 to develop key areas of science in the UK economy. However,
this is an increase of 6.6%, which was larger 2018. However, Mark Smith, partner for innovation these figures must be viewed in the context of Covid-19
Rthan the 4.8% growth in 2017 and the largest incentives at Ayming UK, commented: “At 1.71% GDP, and the immense challenges that society is now facing.”
annual rise since 2013. The Government’s
Industrial Strategy includes a target to raise
investment on R&D to 2.4% of gross
domestic product (GDP) by 2027.
UK R&D statistics are used to assess how
sectors of the economy are contributing
towards reaching this policy goal. In constant
prices (adjusted to remove the effects of
inflation), the 2018 estimate surpassed
2017’s previous high by £1.6 billion, an david.b@atlas.co.uk
increase of 4.6%. With an average annual
growth rate of 2.0% since the 1990 level of
£21.0 billion, the long-term upward trend, in
constant prices, is still evident. In current price terms, the the UK is still a long way off the its target of 2.4% by While some sectors have found R&D opportunities out
UK spent £558 per head of population in 2018; this is an 2027. It was encouraging to see the Government put such of the Covid-19 crisis, it’s likely that overall numbers will
increase of 6.0% compared with 2017 and 172.7% from a strong emphasis on R&D as a mechanism for stimulating be severely hit and will need many years to recover. Mr
£205 in 1990. the economy in the Chancellor’s Budget last month, but Smith concluded: “The economic benefits of R&D
UK gross domestic expenditure on R&D as a we still have a way to go.” investment are well documented and will continue to be
percentage of gross domestic product declined steadily Compared with other EU-28 countries, Mr Smith crucial over the next few years as we try to shake off this
between 1990 and 2004, from 1.73% to 1.50%. Since noted: “We lag way behind our counterparts, currently downturn. Now more than ever the Government needs to
then, the percentage has fluctuated between 1.52% and ranking 11 in the EU and behind many other countries be investing in R&D in order to futureproof the UK as
1.71%, showing a gradual upward trend. The 2018 such as Korea and Japan. It’s also worth noting that these a science and innovation powerhouse.”

INDUSTRIAL TECHNOLOGY • April 2020
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