‘Worrying’ decline in university-business collaboration in UK

University-business interactions in the UK have fallen significantly, with higher education institutions’ industry income also well down on pre-pandemic levels, says a new report.

In its State of the Relationship 2024 report, the National Centre for University and Business (NCUB) reveals a 5 per cent dip in academia’s links with business, which fell to 76,619 interactions in 2022-23.

That decline was even more marked for university interactions with large businesses, which fell by 8.8 per cent, accompanied by a 2.8 per cent drop in income – down by about £24 million to £820 million in 2022-23.

For small and medium-sized enterprises (SMEs) there was a 3.5 per cent fall in UK interactions in 2022-23, to 52,199.

Overall, university-business collaboration income is down by 12 per cent on pre-pandemic levels, says the NCUB report, published on 5 December.

The decline in industry-academia links comes amid growing political interest in the importance of university-business links, with Rachel Reeves’ first budget as chancellor providing at least £40 million of “proof of concept” funding to support university spin-outs over five years.

The new Labour government has also backed the recommendations of the university spinout review led by University of Oxford vice-chancellor Irene Tracey, which was published in November 2023.

Joe Marshall, chief executive of NCUB, described the latest figures on industry-academia interactions as “worrying”, stating that the “new analysis published today reveals some difficult realities for university-business collaboration”.

“New data has revealed a recent decline in direct university interactions with both SMEs and large businesses,” said Dr Marshall, who explained how “economic and geopolitical pressures in 2022-23 impacted both universities’ and businesses’ ability to maintain and grow these critical partnerships”.

“The government, as well as universities and businesses themselves, must pause to re-evaluate how we can better sustain and strengthen these connections, so they can reach their full potential,” urged Dr Marshall.

In addition to financial pressures on industry caused by rising inflation, weak economic growth and the impact of Russia’s war on Ukraine in 2022-23, the loss of structural funding schemes such as the European Regional Development Fund (ERDF) post-Brexit is also highlighted in the report as a challenge to engagement. According to feedback from workshops held by the NCUB, the “short-term nature of the UK Shared Prosperity Fund (UKSPF) may have disincentivised businesses from engaging”, says the report of the ERDF’s replacement.

Campus resource: Building blocks of university-industry partnerships for positive change

The NCUB has previously argued that the previous government’s emphasis on degree apprenticeships might have hindered wider collaboration between universities and industry.

There were, however, positive results in the report, with the number of academic spinouts active for at least three years in 2022-23 increasing by 8.8 per cent to 1,571. That represented a 20 per cent rise since 2018-19.

Meanwhile, some 1,484 patents were granted to university-business collaborations in 2022-23, a 20.5 per cent rise on pre-pandemic levels.

With a “substantial rise in the average value per interaction, reaching £14,154 – the highest in nine years” – the fall in interactions might also “indicate a strategic move towards higher-value, more in-depth collaborations”, the report adds.

“Universities may be focusing on building deeper, more strategic partnerships, with larger and smaller companies alike,” it says.

jack.grove@timeshighereducation.com