On 18 September 2020, the Government published their R&D in the Creative Industries Report. The report is based on research was based on a telephone survey of 625 respondents across nine creativity industry sub-sectors and was undertaken before the COVID-19 lockdown.
The key take home points from the report are as follows:
- INNOVATION ACTIVITY
- Half (51%) of creative industries firms had introduced new or significantly improved products or services in the last three years, and over a quarter (29%) had introduced new or significantly improved products or services that were completely new to the market.
- In total, three fifths (61%) of interviewed firms were classified as ‘innovative’, meaning they had introduced new or improved products, services, forms of organisation, business structures or processes in the last three years. IT, software & computer services firms were most likely to be innovative (68%). Likelihood also increased with firm size, from 60% of firms with 1-9 employees, compared to 76% of firms with 10-49 employees and 83% of those with 50 or more.
- In the last year, 71% of firms had used some form of intellectual property (IP) protections for their technology, designs, content, products or services. The most common was non-disclosure and confidentiality agreements (43%).
- R&D ACTIVITY
- Nearly one in 10 (8%) creative industries firms had a specific budget for R&D. Firms operating in crafts and music, performing & visual arts were most likely to have a specific R&D budget (13% and 12% respectively), followed by IT, software & computer services firms (11%).
- Across all firms, the mean investment in R&D activities in the last year was £30,000. Internal R&D accounted for around 90% of total spend. IT, software & computer services firms also had the highest mean R&D spend at £52,000.
- Just over one in 10 firms (13%) had funded or collaborated with a university or other external organisation on R&D activities in the last year. Design firms were least likely to have collaborated on any recent R&D activities; 4% had done so, rising to 16% of those in IT, software & computer services.
- Creative industries firms had invested in a wide range of other innovation activities alongside R&D, with computer hardware or software the most common (71%), followed by licenses for technology, products or services (49%) and design (42%).
- CONSTRAINTS AND ENABLERS
- The most commonly cited constraints on R&D and innovation activity were the market being dominated by established businesses, the costs of development being too high and availability of finance. These constraints were broadly similar across sectors.
- Two thirds (65%) of firms stated that better access to public support schemes would have encouraged them to do more development activity and more than half (55%) would have been encouraged by improved access to network opportunities. Releasing these constraints would have helped firms conduct more development activity (54%), conduct it in a shorter timeframe (50%) or do better quality development activity (41%).
- FUNDING AND SUPPORT
- Awareness of the R&D tax credit schemes among firms in creative industries is relatively high although take up (at less than 10% of firms) is limited in all sectors except IT, software & computer services.
- In IT, software & computer services both awareness (at 80% of firms) and use of the tax credit schemes (17%) were markedly higher than in any other sector. A small minority (3%) of firms had used other government or public sector funding initiatives for R&D or developing new products, services or processes.