How much does the UK invest in R&D?

For example, between 1993 and 2008, the UK market sector grew by 3% a year. Three-quarters of this growth was driven by capital investment, new technologies and innovation.

So it was great to see innovation at the heart of the Prime Minister's recent speech to the CBI conference, as well as several positive measures to support innovation in the recent Autumn Statement, including a re-commitment to increase public R&D spending to £20bn by 2024/25. Read more about the Autumn Statement and the positive and negative implications for innovation here. 

But how much are we investing in R&D in the UK? Well the Prime Minister’s speech happened to coincide with the publication of the most recent Office for National Statistics (ONS) data on R&D investment in the UK – the Gross Expenditure on R&D (GERD) stats for 2020 as well as Business Expenditure on R&D (BERD) stats for 2021. Here we set out a brief summary of the key figures from the release.

Highlights from GERD statistics (2020)

• Total UK R&D spend increased by around 4% between 2019 and 2020 to almost £62bn.
• However, in constant prices (i.e. adjusted for inflation), this is a small 3% decrease, which is perhaps unsurprising given the impact of the pandemic in 2020.
• Businesses performed £44bn of this investment, 71% of the overall spend.

Highlights from BERD statistics (2021)

• Businesses performed almost £47bn worth of R&D in 2021, a 7% increase on 2020.
• This increase was funded almost entirely by businesses’ own funds.
• 52% of R&D investment was by SMEs (businesses with under 250 employees), with 48% by larger businesses. The estimate of investment by SMEs has increased significantly since previous data publications due to changes in ONS methodology (see note below).
• There were notable increases in R&D investment in chemical and pharmaceutical products, telecoms, software, and construction products compared to previous years.
• There were also some sectoral