Innovation grants found to boost jobs and economy

Innovation grants from government have created an extra 150,000 jobs and stimulated growth worth £43 billion for the UK companies involved, new research has found.

The study, from Enterprise Research Centre (ERC), looked into research and development grants over a 13-year period. It tracked the impact of grants totalling £8 billion which went to nearly 15,000 firms.

The study found that across all who had received grants: employment grew by six per cent in the short term, and 23 per cent in the longer term; turnover grew by six per cent in the short term, and 28 per cent in the longer term; 150,000 new jobs were created; and productivity grew by six per cent in the longer term.

Government has committed an extra £2 billion yearly for research and development by the end of the current parliament, taking the total spend to £4.7 billion.

This will be funnelled partly through the Industrial Strategy Challenge Fund, which aims to tackle societal challenges facing the UK and support high-growth sectors.

Kevin Baughan, Innovate UK deputy chief executive, said: “Innovate UK welcomes this latest research, which highlights the strong, positive impact that public research and innovation grants are having on UK businesses, and on the wider UK economy.

“This provides a strong foundation from which to build on our ambitions for the future. For example, enabling businesses to build more effectively on the world-class research base through the Industrial Strategy Challenge Fund; transforming existing industries and creating completely new ones; and accelerating the deployment of patient capital by bringing venture capital match funding alongside Innovate UK grant funding.”