British business increasingly backs Labour on innovation

More than three-quarters of UK businesses believe the Labour Party would have a positive impact on the country’s innovation, should it win the 2024 general election. With a new poll from Ayming also finding businesses are increasingly calling for state assistance when it comes to things like sustainable development.

Since 2010, a Conservative-led government of one form or another has presided over the UK. And while the 2019 election delivered the Tories a substantial parliamentary majority, the following period has steadily seen the party lose the support of public opinion. Prime Minister Rishi Sunak is understandably reluctant to go to the polls with his party lagging 20 points behind the opposition – but with the government now in the fifth year of its latest term, he will soon have little choice.

It is not just the support of the wider public which seems to have deserted Sunak’s administration, though. A string of studies suggest that while the Conservative Party has long presented itself as the champion of British business, entrepreneurs are also shifting from blue to red at present. A new survey from research and innovation consultancy Ayming further confirms this.

Source: Ayming

Ayming conducted a survey of 603 senior innovation, finance, and CEOs in the UK, including 397 SME respondents and 206 from large businesses. Those surveyed spanned the manufacturing, IT and technology, construction and civil engineering, life sciences and pharmaceuticals, food and beverage, financial services and fintech.

When asked what their current priorities were for the coming years, most said that enhancing operational efficiency was their top business goal – at 36% of respondents. But next highest on the list was ‘driving innovation’ at 28%, and expanding into new markets and regions, on 26%.

With the UK reportedly in a technical recession, borrowing rates rising and inflation still riding high, many firms feel the squeeze when it comes to investing in innovation. Meanwhile, with the incumbent government having presided over Brexit – which many firms now feel has limited their potential to export goods and services to foreign markets, opening up trade with new locations is also more difficult. This may well be why many firms feel more comfortable with the prospect of Labour taking charge after the 2024 general election.

Source: Ayming

Ayming’s researchers noted that despite “being a priority for several successive governments”, the UK’s research and development landscape has suffered some setbacks over the last few years. The UK’s membership of the EU’s cutting-edge Horizon programme, which provides both funding and access to important collaborations, was collateral damage following Brexit – and while the UK has now rejoined the programme, “the damage to public confidence in it as a source of funding has been done.”

As the look to move beyond this, a 77% majority of businesses said they thought Labour would have a positive impact on innovation in the UK economy. That includes 22% who believe the change in government would be “extremely positive”.

Benjamin Craig, an associate director for R&D tax credits at Ayming UK, said, “This should serve as a wakeup call. It’s all well and good saying R&D is a priority, but businesses clearly haven’t felt supported and the government’s track record on innovation isn’t exactly gleaming. There’s a real opportunity for Labour here if they can put forward a vision. What is the plan for the next 10 or 20 years? How can they solve some of the ongoing challenges and really supercharge business innovation? Innovation is central to economic development and therefore should be a priority for any government, regardless of party.”