The National Endowment for Science, Technology and the Arts (Nesta) has just produced a report into innovation in the UK. As their website explains – “Nesta is an independent charity with a mission to help people and organisations bring great ideas to life. We do this by providing investments and grants and mobilising research, networks and skills”. Their new report argues that there has been a £24bn collapse in innovation investment over the last 3 years in the UK economy. They describe the period since 2000 as a ‘lost decade’ of innovation, with new evidence showing that businesses had a crisis of confidence in the 2000s, prioritising cash, infrastructure and property over investment in innovation.
Another striking feature of the report is that only 13% of innovation investment now takes the form of conventional R&D. Other important types of innovation investment captured in the index include design, software development, innovative training and organisational development. Nesta should not be too surprised about this given the shift in the UK economy from manufacturing to services.