If you wonder why there has been a lack of brilliant ideas coming out of Britain lately it might be because the nation's businesses are cutting back on research.
A third of British companies spend nothing on searching for new ideas, services and products according to a new survey conducted by IT consultancy Portal. The survey of 500 companies up and down the country found that only a fifth of companies spend more than five per cent of their revenues on research and development (R&D), despite the fact that nearly 52 percent recognise that innovation is critical.
In a whitepaper entitled “Innovation: the first casualty of a downturn”, the companies said that the economic downturn is the main reason for failing to invest in R&D. Less than seven per cent of respondents have increased their investment since the start of the recession in 2008 while nearly 14 per cent have “cut their investment in R&D enormously.” More than 48 per cent said they would invest more if the government was able to offer tax breaks on R&D expenditure.
Lack of available funds is not the only reason for companies failing to invest sufficiently. Perceived difficulty of the process is deterring some from applying sufficient resource too.
Cutting back too much on research
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