2023年英国创新报告

UKINNOVATIONREPORT2023

BenchmarkingtheUK’sindustrialand

innovationperformanceinaglobalcontext

InstituteforManufacturing,UniversityofCambridge

March2023

Tableofcontents

Listofcharts

3

Whatmakesthereportdifferent?

4

Introduction

5

Contributorsandacknowledgments

6

ExecutiveSummary

7

Theme1:StructureandperformanceoftheUKeconomy

11

Theme2:Investmentininnovation

24

Theme3:Industrialperformance–focusontheaerospaceandfood&beveragesmanufacturingsectors

43

Theme4:Scienceandengineeringworkforce

85

Theme5:Environmentalinnovation

94

2

Listofcharts

Theme2:Investmentininnovation

Theme1:StructureandperformanceoftheUKeconomy

Chart1.1.StructureoftheUKeconomy

Chart1.2.Labourproductivitybycountryandregion

Chart1.3.Sectorallabourproductivitybycountryandregion

Chart1.4.SectorallabourproductivitygrowthbycountryandregionChart1.5.Value-addedandemploymentsharesbysector,countryandregion

Chart1.6.Changeinvalue-addedandemploymentsharesbysector,countryandregion

Chart1.7.Intra-industryproductivitygrowtheffect:topandbottomfivesectorsintheUK

Chart1.8.Allocationeffect:topandbottomfivesectorsintheUKChart1.9.Totalsectors’contributiontoaggregatelabourproductivitygrowth:topandbottomfivesectorsintheUK

Appendix1.1Sectors’classificationandstatisticalcodes

Appendix1.2Decompositionofproductivitygrowth

Chart2.1.R&Dintensity:internationalcomparison(1/2)

Chart2.2.R&Dintensity:internationalcomparison(2/2)

Chart2.3.ONSrevisionofBERDmethodology

Chart2.4.UKBERDbycompanyemploymentsize

Chart2.5.UKBERDbybroadproductgroup

Chart2.6.UKBERDbydetailedproductgroup

Chart2.7.UKBERDbyStandardIndustryClassification

Chart2.8.ManufacturingR&D:internationalcomparison

Chart2.9.GovernmentexpenditureonR&D

Chart2.10.FlowsofresearchanddevelopmentfundingintheUnitedKingdom

Chart2.11.TopR&D-investingcompaniesintheworld

Chart2.12.Top100companiesinvestinginR&D

Chart2.13.Toporiginsofpatentapplications

Chart2.14.Top100patentapplicantsatUSPTOandEPO

Chart2.15.Top10UKpatentapplicantsatUSPTOandEPOExplainer:The“new”ONSmethodologytocalculateR&DexpenditureintheUnitedKingdom

Theme5:EnvironmentalInnovation

(specialthemeinthisedition)

Chart5.1.UKcarbonemissionsbysector

Chart5.2.GovernmentbudgetallocationsforR&D(environmentand

energyinnovation)

Chart5.3.Innovationinenvironment-relatedtechnologies

Chart5.4.Eco-innovationperformance

Chart5.5.UKenvironmentalgoodsandservicessector(EGSS)Chart5.6.UKenvironmentalgoodsandservicessector(EGSS)–internationalcomparison

Theme3:Industrialperformance–focusontheaerospaceandfoodandbeveragesmanufacturingsectors

Chart3.1.Aerospacemanufacturing–valueaddedandemployees

Chart3.2.UKaerospace–valueadded

Chart3.3.UKaerospace–employees

Chart3.4.UKaerospace–productivity

Chart3.5.Aerospacemanufacturing–tradebalance

Chart3.6.Aerospacemanufacturing–globalexportmarketshare

Chart3.7.UKaerospace–tradebalance

Chart3.8.Aerospace–businessspendingonR&D(a)

Chart3.9.Aerospace–businessspendingonR&D(b)

Chart3.10.Foodandbeveragesmanufacturing–valueaddedandemployeesChart3.11.UKfoodandbeveragesmanufacturing–valueadded

Chart3.12.UKfoodandbeveragesmanufacturing–employees

Chart3.13.UKfoodandbeveragesmanufacturing–productivity

Chart3.14.Foodmanufacturing–tradebalance

Chart3.15.Beveragesmanufacturing–tradebalance

Chart3.16.Foodmanufacturing–globalexportmarketshare

Chart3.17.Beveragesmanufacturing–globalexportmarketshare

Chart3.18.UKfoodandbeveragesmanufacturing–tradebalance

Chart3.19.UKfoodandbeveragesmanufacturing–topexportandimportproducts

Chart3.20.Foodandbeverages–businessspendingonR&D

Chart3.21.UKfoodandbeverages–businessspendingonR&D(BERD)Appendix3.1Stakeholderconsultation–aerospaceandfoodandbeveragesmanufacturingsectors

Theme4:Scienceandengineeringworkforce

Chart4.1.Graduatesbysubjectarea

Chart4.2.WomeninSTEMtertiaryeducation

Chart4.3.InternationalstudentsintheUK

Chart4.4.GraduatesenteringtheworkforceintheUK

Chart4.5.Engineeringprofessionsalaries

Chart4.6.Researchersbysectorofemployment

Chart4.7.Womenresearchers

3

Whatmakesthereportdifferent?

TheaimoftheUKInnovationReportistofacilitatepolicydiscussionsoninnovationandindustrialperformance–andtheinterplaybetweenthem.Whilenumeroussourcesofdataonthetopicofinnovationexist,theUKInnovationReportaimstomakeacontributionbybringingtogether,inasingleplace,innovationandvalue-addedindicatorsinaconciseandaccessibleformat.

Insteadofstructuringthereportaccordingtotraditionalinputandoutputindicators,theintentionofthereportistoincludedatathatprovidesrichquantitativerepresentationsofthevitalityofboththeUK’sinnovationactivityanditsindustrialperformanceinaninternationalcontext.

Animportantthemethroughoutthereportistheanalysisofsectoralandregionaldatatobetterunderstandthedriversofnationalperformanceandprovidemoregranularpolicyinsights.Whilethereportdoesnotmakespecificpolicyrecommendations,itdoeshighlightareaswhereadditionalevidenceandpolicyactionmayberequired.

Motivation

1

1

1

ToreviewtheUK’sinnovationandindustrialperformanceandcompareitwiththatofotherselectedcountries;Tofacilitatediscussionsontherelationbetweeninnovationandsectoralcompetitiveness;and

Tocontributetotheevidencebasethatisavailabletoinformindustrialandinnovationpolicy.

4

Introduction

TheUKInnovationReport2022reportedlastyearanew

InnovationStrategy

,anew

OfficeforScienceandTechnologyStrategy

andanewNationalScienceand

TechnologyCouncil.Thisyear,themajorinstitutionalchangehasbeentheministerialrestructureinFebruary2023.

Anew

DepartmentforScience,InnovationandTechnology(DSIT)

wascreatedwiththemandatetoensuretheUKis“themostinnovativeeconomyintheworld”anda“scienceandtechnologysuperpower”.DSITpublishedits

ScienceandTechnologyFramework

inMarch2023whichidentifiesfivecriticaltechnologiesthattheUKshouldfocusontobuildstrategicadvantageandcommits£250mto‘technologymissions’inthreeofthem:artificialintelligence,quantumtechnologiesandengineeringbiology.Amongotherchanges,anew

DepartmentforBusinessandTrade

hasbeencreatedbringingtogetherthebusinessfocusedfunctionsoftheformerDepartmentforBusiness,EnergyandIndustrialStrategy(BEIS)andtheDepartmentforInternationalTrade(DIT).

InNovember2022theOfficeforNationalStatistics(ONS)introducedamajor

revision

tothemethodologyusedtoestimateR&DexpenditureintheUKtogivebettercoverageofsmallerbusinesses,whichhaveaccountedforagrowingamountofR&Dactivity.

Whatisnewinthiseditionofthereport?

Againstthischanginginstitutionalcontext,theUKInnovationReport2023maintainslastyear’scorepolicyguidingquestionsbutusesnewdatasetstoaddressthemfromdifferentangles.Thereportusesnewindicatorsandlongertimeseries,integratesadditionaldatasources,anddeepdivesintodifferentsectors.

1Section1exploreshowproductivitytrendsvaryacrossUKregionsandcountriesandtheroleofsectordynamicsinthesedifferences.

1Section2analysesthelatestdataonR&DexpenditureintheUK,discussingtheimplicationsofrecentmethodologicalchangesintroducedbytheONS.

1Section3focusesontheperformanceoftheaerospaceandfood&beveragessectors,incorporatinginsightsfromconsultationswithindustryexperts.

1Section4updatestheanalysisofUKgraduatesinscience,technology,engineeringandmathematics(STEM)comparingtheUKwithinternationalpeers.

1Section5analysestheUK’seconomicandinnovationperformanceintheenvironmentalgoodsandservicessector.

5

Contributorsandacknowledgements

CambridgeIndustrialInnovationPolicy

CambridgeIndustrialInnovationPolicy(CIIP)isaglobal,not-for-profitpolicygroupbasedattheInstituteforManufacturing(IfM),UniversityofCambridge.CIIPworkswithgovernmentsandglobalorganisationstopromoteindustrialcompetitivenessandtechnologicalinnovation.Weoffernewevidence,insightsandtoolsbasedonthelatestacademicthinkingandinternationalbestpractices.ThisreportwasdeliveredthroughIfMEngage,theknowledgetransferarmoftheInstituteforManufacturing(IfM),UniversityofCambridge

IfMEngage,17CharlesBabbageRoad,Cambridge,CB30FS,UnitedKingdom

www.ciip.group.cam.ac.uk

Contributors

Thecontributorstothisreportare:JenniferCastaneda-Navarrete,ZongshuaiFan,MateusLabrunie,DavidLeal-Ayala,CarlosLópez-GómezandMichelePalladino.ResearchassistancewasprovidedbyGuendalinaAnzolin(InstituteforManufacturing).CoverdesignbyEllaWhellams.Copy-editingbyElizabethTofarisandAmandaGeorge.

Acknowledgements

TheauthorswouldliketothankTimMinshallandEoinO’Sullivan,whoprovidedcommentsandsuggestionsandreviewedearlierversionsofthisreport.Wewouldalsoliketothankalloftheorganisationsfromtheprivateandpublicsectorswhoprovidedvaluabletimeandinsightsduringtheinterviewsandworkshopscarriedouttoinformthereport.

Disclaimer

Namesofcountriesandterritoriesfollowwidelyacceptedconventionsanddonotimplytheexpressionofanyopinionwhatsoeveronthepartoftheauthorsortheiraffiliatedinstitutionsconcerningthelegalstatusofanycountry,territory,cityorarea,orofitsauthorities.Anymentionoffirmnamesorcommercialproductsdoesnotconstituteanendorsementbytheauthorsortheiraffiliatedinstitutions.

Forfurtherdetails,pleasecontact:

ifm-policy-links@eng.cam.ac.uk

Pleasereferencethisreportas:CambridgeIndustrialInnovationPolicy(2023).UKInnovationReport2023.IfMEngage.InstituteforManufacturing,UniversityofCambridge.

6

Executivesummary

UKINNOVATIONREPORT2023

7

Executivesummary(1/3)

ThemeKeypolicyquestionsaddressedKeyfindings

1

Structureand

1performanceof1theUKeconomy

1

HowdoesproductivityvaryacrossUKregionsandcountries?

HowhastheeconomicstructureoftheUKregionschangedinthelastfewyears?Arethesechangesaffectingeconomicperformance?

1

1

DisparitiesbetweenUKregionsandcountriesarelargeandwidening:in1999labourproductivityinWalesrepresented65%ofthatobservedinLondon;however,in2019Wales’productivitywasonly58%ofthatofLondon.

Regionalanalysisconfirmsthatinthelasttwodecades,theexpansionofservicesectorsattheexpenseofhigherproductivitysectors,suchasmanufacturing,hasslowedoverallproductivitygrowthandcontributedtowideningproductivitygapsacrosstheUK.

1

AnewmethodologyintroducedbytheOfficeforNationalStatistics(ONS)haspushedthe

1

IstheUKspendingenoughonR&D?

estimatedUKexpenditureonR&DaspercentageofGDPfor2019from1.7%to2.7%.

2

1

Investmentin

innovation

1

Howdothepublicandprivatesectors

contributetonationalexpenditureon

innovation?

HowdoestheUKcomparewithother

1

Whilethismeansthatthe2.4%targethasbeenachieved,theUKremainswellbehindcountriessuchasGermany,theUnitedStatesandSouthKorea,whichinvestedbetween3.2%and4.6%ofGDPonR&D.

countries?

1

At0.12%theUKgovernment’sexpenditureonR&Din2019wasstillhalftheOECDaverageof

0.24%.

8

Executivesummary(2/3)

ThemeKeypolicyquestionsaddressedKeyfindings

3.1

Industrial

performance–focusonthe

aerospacemanufacturingsector

1AreUKsectorsbecomingmoreorlesscompetitiveinternationally?

1HowareUKsectorsperformingintermsofproductivity,valueaddedandemployment?

1AreUKsectorsinvestingenoughinR&Dcomparedtotheirinternationalcompetitors?

1

1

1

1

TheUK’saerospacemanufacturingsectorwasthethirdlargestintheOECDin2019,behindonlytheUnitedStatesandFrance.

TheUK’saerospacemanufacturingsectorspecialisesinenginesandotheraircraftcomponentssuchaswings;itstradesurplus(US$14.7billion)wasthethirdlargestintheworldin2021.

14,000jobswerelostinthesectorin2020–21dueacollapseindemanddrivenbytheCovid-19pandemic,whichlettocompanyrestructuringandacceleratedsupplychainconsolidation.

UKaerospacecompetitivenessisunderpinnedbyadvancedR&Dandinnovationcapabilities,withUKbusinessexpenditureonaerospaceR&DrankingthirdamongOECDcountriesandgrowingsteadilyinthelastdecade.

1

TheUK’sfoodandbeveragesmanufacturingsectorwasthesixthlargestintheOECDin2019,behindthe

UnitedStates,Japan,Mexico,FranceandGermany.

1

Demandinthefoodandbeveragessectorhasproventobehighlyresilienttorecessionsanddisruptive

events,includingthefinancialcrisis,theCOVID-19pandemicandBrexit,asreflectedbythesector’sgrowth

Industrial

performance–focusonthe

3.2foodand

beveragesmanufacturingsector

1AreUKsectorsbecomingmoreorlesscompetitiveinternationally?

1HowareUKsectorsperformingintermsofproductivity,valueaddedandemployment?

1AreUKsectorsinvestingenoughinR&Dcomparedtotheirinternationalcompetitors?

1

1

1

beinvestmentininnovationconsultationssuggestthatopportunities

invalueaddedoverthelastdecadeanditsstableproductivitylevelsduringthisperiod.

MostfoodandbeveragesmanufacturersarefocusedonmeetingdomesticUKdemandandhavelimitedincentivestoexport.TheUKproducesaround60%ofitsdomesticfoodconsumptionbyeconomicvaluethoughimportsareanessentialpartoftheindustryduetogeography,weatherandlandavailability.TheUK’sfoodandbeveragesectorhasoneofthelargesttradedeficitsintheworld,thoughitremainsaleadingexporterinhighvaluenichessuchaswhiskey.

UKbusinessexpenditureonfoodandbeveragesR&Dhasincreasedsteadilyduringthelastdecade,reachinglevelscomparabletootherleadingOECDnations.

ProductinnovationisakeyfocusoftheUKfoodandbeveragessector.However,economicanddemand

uncertaintymayhindering.Industry

existtoincreasetheadoptionofdigitalandautomationsolutions,particularlyamongSMEs.

1

Unfilledvacancieshavebeenalong-standingissueinthesector,withvacanciesper100employees

increasingto9.1inQ32022,from6.3inQ22022,whichismorethandoubletheUKaverageof4.1.

9

Executivesummary(3/3)

ThemeKeypolicyquestionsaddressedKeyfindings

1

Althoughscience,technology,engineering,andmathematics(STEM)graduatesintheUKaccounted

for41%oftotalgraduates–abovecountriessuchasFranceandCanada,andsimilartotheUnited

Scienceand

4engineeringworkforce

1IstheUKproducingenoughscientistsandengineers?

1IstheUKgovernmentinvestingenoughintechnicalandvocationaleducation?

1Howdoesthiscomparewithother

1

States–theshareofgraduatesintheSTEMsub-disciplineofengineering,manufacturingandconstructionrepresentedonly9%ofgraduates,wellbelowcomparatorcountriessuchasGermany(26%)andKorea(21%).

TheUKhadarelativelylowshareofresearchersworkinginthebusinesssectorin2020(42%),belowKorea(82%),Japan(75%),theUnitedStates(72%),France(63%)andGermany(60%).

countries?

1

Althoughwomenaccountfor39%oftotalresearchers,placingtheUKinthetop10ofOECDcountries,

femalegraduatesareunder-representedinsomeSTEMdisciplinesintheUK,particularlyin

engineering,manufacturingandconstruction.

1HowdoestheUKcompareinenvironmentalandenergytechnologyresearchanddevelopment(R&D)

1

GrossvalueaddedintheUKenvironmentalgoodsandservicessector(EGSS),asdefinedbytheONS,wasestimatedtobe£45.2billionin2019(up5.4%from2018).Thesector’semploymentisestimatedat394,900full-timeequivalentemployeesin2019(down4.7%from2018).

5

EnvironmentalInnovation

investment?

1HowisR&Dexpendituretranslatingintopatentingperformance?

1IstheUKcapturingtheeconomic

1

TheOECDestimatesthatat6%,theUKhadthesixthhighestgovernmentbudgetallocationforR&DinenvironmentandenergyinnovationamongOECDcountriesin2020.ThisishigherthanthatoftheUnitedStates(3%),butlowerthanJapan(8%),Germany(8%),Korea(8%),andFrance(9%).

potentialofthetransitiontowardsenvironmentalsustainability?

1

TheUKranksseventhamongOECDcountriesinpatentapplicationsforthegroupoftechnologiesdefinedbytheOECDas“environment-relatedtechnologies”.

10

Theme1:StructureandperformanceoftheUKeconomy

UKINNOVATIONREPORT

12

Theme1:StructureandperformanceoftheUKeconomy

Keypolicy

questions

addressed

1

1

1

HowdoesproductivityvaryacrossUKregionsandcountries?

HowhastheeconomicstructureoftheUKregionschangedinthelastfewyears?

Arethesechangesaffectingeconomicperformance?

Keyfindings

SubstantialandwideningproductivitygapsareobservedbetweenLondonandtherestoftheUK.

1LondonandtheSouthEastofEnglandaretheUKregionswiththehighestlabourproductivitylevels,showingannualvaluesof£80,034and£59,709valueaddedperjobin2019.Incontrast,Wales,theNorthEastofEngland,andYorkshireandtheHumberhaveamongthelowestproductivitylevels,around£47,000in2019.

1In1999labourproductivityinWalesrepresented65%ofthatobservedinLondon;however,in2019Wales’productivityaccountedforonly58%ofthatofLondon.

Spatialdisparitiesinsectoralproductivitylevelsareparticularlylargeinagriculture,forestryandfishing;arts,entertainmentandrecreation;professional,scientificandtechnicalactivities;andfinancialandinsuranceactivities.

1London’ssectoralproductivitylevelsareabovetheUKaverageforallsectorsexceptmanufacturingandagriculture.TheproductivityofLondon’sprofessional,scientificandtechnicalactivitiesis2.4timeslargerthanthatobservedinWales,theUKareawiththelowestproductivitylevelinthissector.

1Substantialgapsarealsoobservedinthepaceofproductivitygrowthintheinformationandcommunicationsector.TheNorthEastofEngland(16.2%)andWales(13.6%)sawthefastestgrowthbetween1999and2019.Incontrast,Londonsawtheslowestgrowth(6.0%).

Inthelasttwodecades,theexpansionofservicesectorsattheexpenseofhigherproductivitysectors,suchasmanufacturing,hassloweddownoverallproductivitygrowthandcontributedtowideningproductivitygapsacrosstheUK.

1Between1999and2019knowledge-andlabour-intensiveservicesexpanded,whilemanufacturingreduceditsparticipationintheUKeconomy.However,sinceserviceactivitiestendtohaveproductivitylevelsbelowtheaverageofthetotaleconomyandshowslowerproductivitygrowth,theirexpansionhassloweddownproductivitygrowth.

1ThemostnegativeimpactsfromtheshrinkageofmanufacturingareobservedintheEastMidlands,theNorthWest,theNorthEastandtheWestMidlands,wherethedeclineofmanufacturingcosttheseregionsapercentagepoint,onaverageperyear,between1999and2019.

100%90%80%70%60%50%40%30%20%10%0%

Chart1.1.StructureoftheUKeconomy,2021

Grossvalueadded,employment,exportsandbusinessR&Dexpenditure(BERD)[1]

30.9

million

£46.9

£610

billion

£2,105

billion

million

GrossvalueEmploymentExportsBERD

added

Unknownindustry

Agriculture,forestryandfishingMiningandquarrying

Utilities

Medium/high-tech

manufacturing

Low/medium-tech

manufacturing

Construction

Knowledge-intensiveservicesLabour-intensiveservices

Note:[1]Exportdatacorrespondsto2020,industrypercentagesbasedonOfficeforNationalStatisticsexperimentaldata.Appendix1.1presentsdefinitionsoftheseclassificationsofsectors.Source:OfficeforNationalStatistics.

1Bothknowledge-intensive[1]andlabour-intensiveservices[1]representedaround80%ofthegrossvalueaddedandemploymentoftheUKeconomyin2021.

1Althoughmedium/high-techmanufacturing[1]accountsfor5%ofthegrossvalueaddedand3%ofemployment,thissectoraccountsforthelargestshareofexports:37%in2020andthesecondlargestshareofbusinessR&Dexpenditure,around35%,in2021.

1Themanufacturingsectorasawholeaccountsforlessthan10%oftheUK’svalueadded.However,thesizeofthemanufacturingsectorvariesacrossUKregionsandcountries.

Note:[1]Appendix1.1presentsdefinitionsoftheseclassificationsofsectors.

13

Chart1.2.Labourproductivitybycountryandregion

Grossvalueaddedperjob,1999–2020

Annualvalueaddedperjob(chainedvolumemeasuresin2019moneyvalue)

£85,000

£80,000

£75,000

£70,000

£65,000

London

£60,000

EastMidlands

SouthEast

£55,000

England

UnitedKingdomScotland

EastofEngland

£50,000

NorthWest

NorthernIrelandSouthWest

WestMidlands

YorkshireandtheHumber

£45,000

NorthEast

£40,000Wales

19992001200320052007200920112013201520172019

Source:Authors’calculations,basedondatafromtheOfficeforNationalStatistics.

1SubstantialproductivitygapsareobservedbetweenUKregionsandcountries.In2019LondonandtheSouthEastofEnglandweretheUKregionswiththehighestlabourproductivitylevels,withannualvaluesof£80,034and£59,709perjob.Incontrast,Wales,theNorthEastofEngland,andYorkshireandtheHumberhadthelowestproductivitylevels,ataround£47,000.

1Productivitygapshavewidenedinthelasttwodecades.In1999labourproductivityinWalesrepresented65%ofthatobservedinLondon;however,in2019productivityinWalesaccountedforonly58%ofthatofLondon.

1Between1999and2019LondonandScotlandweretheregionsandcountriesthatexperiencedthefastestproductivitygrowth,withratesof1%and0.8%,respectively.

1Scotlandalsofaredbetterduringthefinancialcrisisof2008/9;itdidnotexperienceafallin