A snapshot of UK collaboration in a post-Brexit world
Collaborations between UK universities and industry are robust and on the rise, according to the first full study of the sector since the Brexit referendum. The value of such collaborations, however, is dropping with the average lower than those of previous years.
The Collaboration Progress Monitor, released in a new report from the National Centre for Universities and Business (NCUB), takes a snapshot of the state of the collaboration field, weighing its strength against 15 metrics across four dimensions. These include resources for collaboration, knowledge flows between universities and business, partnerships, and commercialisation activity.
State of the Relationship 2019 is an exploration and celebration of the achievements made when universities and business come together to innovate and provide social and economic benefits.
— National Centre for Universities and Business (@NCUBtweets) June 20, 2019
The latest results are based on figures from the 2016-2017 academic year, the first set of data to come out after the June 2016 EU referendum.
The figures show some interesting results; reinforcing trends that have been consistent over the last six years, while also highlighting potential areas for concern for the UK government. But ultimately, they show that the area of collaboration is thriving and, despite some speed bumps along the way, is still showing no signs of diminishing following that fateful 2016 vote.
Partnerships, on the whole, are looking healthy with numbers going up, but there was a significant difference depending on the size of a company.
Despite a push from government to get more small and medium-sized (SMEs) involved with academic collaboration, the report showed there was a reduction in the number of partnerships between SMEs and universities. The decrease was significant, falling 13 percent from the previous year.
The good news, however, was that the size of these collaborations went up significantly, with the average deal with SMEs increasing in value by 21.8 percent in 2017.
Big business recorded the exact opposite trend in statistics. There was a very slight increase in number of partnerships with universities, growing by 1.6 percent on the previous year. But the size of an average deal fell by 4.5 percent.
The report assigned this drop in value to the increasingly diverse field of university collaborations and the many different and varying levels of knowledge exchange that are now available to companies. Universities are becoming more accessible and partnerships more diverse in their size and value.
Innovate UK – the government branch behind Knowledge Transfer Partnerships – have been doing their part to bring universities and business together with a reported 33 percent increase in the number of grants from 2016 to 2017.
This again recorded a significant drop in average value of each grant – a whopping 72.3 percent, according to the report. This is, however, skewed due to the provision of eight grants over the value of £25 million (US$32 million) in 2016. This was unusual and returned to normal in 2017 in which no academic grants exceeded £8 million (US$10 million).
Patents are on the up as more and more universities are converting their research and collaboration into viable products for market.
According to NCUB, universities were granted 16 percent more patents in 2017 than in the previous year, bringing the total to 1416 and beating the 5-year average by over 300.
This progress is translating into successful business with the number of spin-off companies surviving for at least three years growing by four percent.
— National Centre for Universities and Business (@NCUBtweets) June 21, 2019
The report believes this improvement reflects “a steady increase in the ability of universities to capture and sustain the value of interactions leading to IP, and fewer early exits.”
Licencing also exploded, increasing by 38.4 percent in 2017, however, the income received from licensing took a dramatic fall of 22 percent to £102 million.
Income and investment
UK universities continue to be a big draw for foreign companies wanting to realise their R&D ambitions, with an increase of 8.1 percent in the share of university research funding coming from overseas. Even after Brexit, the UK remains one of the top nations in the world for knowledge exchange and foreign direct investment, according to the World Economic Forum.
Its high-quality academic research paired with a robust innovation ecosystem – supported by physical and digital infrastructure, world-class talent, and an enabling regulatory environment – has placed the UK in the top four of global innovation nations.
While this is enough to draw overseas companies, there was an overall drop in business investment – including the UK – into university business collaboration, according to the report. University R&D income derived from industry investment dropped from £956 million in 2016 to £954 million in 2017.
The report points out that, while not too substantial, the drop in business investment should be concerning if the UK is to reach its target of increasing investment into R&D up to 2.4 percent of GDP by 2027.
In 2017, the UK invested £34.8 billion (US$44 billion) in R&D across all sectors, the equivalent to 1.7 percent of GDP. But they have included plans to hike that to 2.4 percent in their latest International Research and Innovation Strategy, released in May. To achieve this, investment will need to increase to around £70 billion, doubling in nominal terms.
The state of collaboration varies drastically across the UK. In terms of just number of collaborations, this is not surprising given the varied number of universities in each country, but there are also differences in the averages and funding.
Wales has by far the highest value per deal with SMEs averaging almost £5,500 compared to just £1,811 in Scotland and £3,165 in England.
England tops the list for highest average value in deals with big businesses, however, getting an income of almost £27,000 compared to Wales’s smaller £12,000.
Our 'Engineering You're Hired!' student project and #MindSphere collaboration with @Siemens are both featured in the latest @NCUBtweets report as inspiring examples of how students can work with industry to develop their skills: https://t.co/lnILW7Bv7q pic.twitter.com/ivRQho5B5u
— EngineeringSheffield (@SheffUniEng) June 21, 2019
England also dominates in number of Innovate UK grants with a whopping 607 compared to just 25 in Northern Ireland and 34 in Wales. The value was also higher than most, with England receiving nearly £235,000 per grant in contrast to Wales, receiving just £127,000. Scotland did beat England, however, in the average value of grants, coming in at £240,667 from Innovate UK.
Having significantly larger numbers of partnerships at higher values is proving lucrative to England universities, which received £81.3 million in income from licencing. They were also granted 1179 patents and spurred 732 spin-off businesses.
The bigger picture
The snapshot from 2017 provides a helpful picture of a sector that’s remaining robust and relatively stable despite outside pressures. But by zooming out and examining the statistics over a wider timescale, it’s easy to see just how much the field has grown in recent years.
After measuring the Collaboration Progress Monitor over the last six years, NCUB has recorded a 44 percent rise in the number of deals between universities and SMEs. There has also been a nine percent increase in number of deals between higher education and big business.
All of this equals up to a significant 27 percent boost in industry income derived from knowledge exchange.
What the future holds
While this is the first comprehensive study into the collaboration sector after Brexit, the report is quick to point out that the data does not capture the numerous and significant political decisions that have followed the referendum back in June 2016.
It does, however, paint a picture of a healthy sector that is anchored by the high quality of its tertiary education providers. The UK continues to be a hub of innovation, driven both by foreign direct investment and a concerted effort from the government to maintain the momentum and remain at the front of the pack in R&D.