R&D spending in the UK increased despite pandemic

According to latest ONS data, manufacturing sector R&D spending rose by 4.4% despite the pandemic.

The industry spent £15.3bn on R&D in 2020, up from £14.6bn invested in 2019. The increase came despite widespread disruption caused by the COVID-19 pandemic, which had led to fears that levels of innovation could suffer.

Over the past decade, R&D spending in the manufacturing sector has grown 104.5%, up from £7.5bn in 2010.

The manufacturing sector’s performance was slightly worse than the performance of UK industry as a whole and the UK GDP in 2020 was down by 9.8% on an annual basis according to the ONS – the worst performance since 1709.

Mark Tighe, CEO of R&D tax relief consultancy Catax, says, ‘The pandemic stopped businesses in their tracks but those reliant on innovation clearly didn’t take their foot off the gas. 

‘Manufacturers, like all sectors, suffered major disruption last year so it’s hugely encouraging that the industry still managed to grow its R&D spend on an annual basis. This will put the sector on a strong footing as the economic recovery gains pace.’