UK innovation faces a number of crises. The UK is now the second-lowest R&D spender in the G7; UK patent-registrations have fallen over the last twenty years despite increasing in the US, Japan, Germany, and most major competitors. Our corporates find the long-term investments needed for innovation especially difficult, yet these are a leading source of growth. This is helping to create the ongoing “new normal” of low growth in the UK.
But this is not simply an economic crisis. In the Cold War, the USSR’s launch of Sputnik created the sense of urgency in the US that led to a renewed defence-innovation ecosystem, with the side-effect of improved economic growth. Today, China has adopted a more expansionist posture, and is investing increasingly heavily in defence innovation.