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Economic impact R&D activities

Research-intensive universities generate nearly £38 bn for UK economy

Published on: 28 February 2024

A new report assessing the economic impact of the Russell Group universities, found that for every £1 of public funds invested in research, more than £8.50 was generated for the UK economy.

As a result, this means the impact of their research and commercialisation activities equated to £37.6 billion in 2021/2022.

Analysis by London Economics showed that the research and commercialisation activities of the 24 Russell Group universities, such as the creation of new spin-out companies, wider knowledge exchange and Intellectual Property licensing across all four nations helped to support more than a quarter of a million (254,000) jobs, twice as many as in the chemical and pharmaceutical manufacturing industries combined.

The report shows how the universities contributed to economies in every single region and nation of the country, delivering research and innovation in sectors ranging from medicine to sustainable energy and the creative industries. This is in addition to the economic impact generated by wider productivity spill overs, teaching and education-related activities, and the fees and spending from international students.

Professor Chris Day, Chair of the Russell Group and Vice-Chancellor and President of Newcastle University said:

“This report reveals how Russell Group university research and commercialisation activities generated nearly £38 billion for the UK economy in 2021/22, supporting more than a quarter of a million jobs. This is in addition to the impact of our teaching and learning activities.

“Continuing to produce world-leading research and innovation in sectors ranging from medicine to sustainable energy and the creative industries is imperative to the long-term development of future generations and the growth of our economy.

“With every £1 of public money invested generating £8.50, there is a real opportunity for the Government to further leverage the knowledge economy for growth.”

Investment in R&D

The Russell Group is urging the Government to maximise the economic potential of the UK’s research-intensive universities by ensuring at least 3% of GDP is invested into R&D by 2030.

The Group, which represents 24 leading research universities including Newcastle University, notes that such a commitment by current and future Governments would not only bring the UK in line with other top research nations but also deliver further benefits to the UK economy in years to come. In a letter to the Chancellor ahead of the Spring Budget, the Group asked the Government to use the Budget to deliver on its existing commitment to invest £20bn in R&D by 2024/25.

Dr Tim Bradshaw, Chief Executive of the Russell Group, said:

“These findings demonstrate the immense value our universities add in every single corner of the UK. The data clearly shows that investing in R&D and innovation at Russell Group universities reaps huge benefits for local economies and communities, with hundreds of thousands of jobs created and new enterprise supported, thanks to high quality research across a range of disciplines.

Russell Group breakthroughs are helping accelerate efforts to reach Net Zero responsibly, transforming the way UK companies do business and providing the NHS with new ways to save lives and cut waiting lists. Good choices and sustained investment from government has been crucial to this success.

“Now is the time to build on this success with robust funding to future-proof the skills and talent pipeline that is so vital to the growth of our economy – and to ensure that the research and innovation that originates within universities will continue to make a tangible, positive impact on people’s lives”.

The research was commissioned by the Russell Group, and estimates the direct, indirect, and induced economic impacts associated with the research, wider knowledge exchange activities and spin-out companies of Russell Group universities, as well as the wider productivity spillovers from Russell Group research. It does not look at the value add and economic impact of teaching and learning activities, education exports or civic engagement activities.

Read the full report + stories of businesses

Spin-out success: Atelerix

More than 1,200 spin-out companies currently operate throughout the UK thanks to research and support from Russell Group universities.

One example of an innovative business that started with university R&D is Atelerix, which has developed transformative technology that helps researchers and businesses store and transport biological materials safely at ambient temperatures, removing the need for refrigeration. This overcomes the barriers and limitations of the current need for cryo-shipping.

The Newcastle University spin-out, backed by the Northern Accelerator, use a patented process of encapsulating the cells and tissues in a natural alginate hydrogel made from seaweed. The cells and tissues can be recovered when needed by the addition of a gentle, cell-friendly buffer.

The method is practical and adaptable, opening up the market for the supply of cells and assays in a ready-to-use format, allowing cell suppliers to scale up their businesses, increase the range of assays available to consumers and improve access to stem cell therapy. Benefits include predictability and reliability in drug discovery models and for cells used as therapies, the opportunity for customers to use cells and assays immediately on arrival and removing the need for cryopreservation, or the alternative need for cytotoxic or animal-derived supplements.

In May 2019 Atelerix announced they'd closed a second round of funding of £700,000 to accelerate development of its products to market, and in February 2024 the company completed a further funding round of £500,000. 

Press release adapted with thanks from the Russell Group


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