UK innovation survey 2023 – results for Scotland

International Comparisons

The UK definition of innovation is based on an Organisation for Economic Co-operation and Development (OECD) definition outlined in the Oslo Manual 2018.  This makes it possible to compare the rates of business innovation across the OECD and partner economies. However, the OECD reports on a smaller group of industrial sectors compared to the UKIS. For example, the UKIS includes businesses in the ‘Construction’, ‘Retail’ and ‘Accommodation and Food Services’ sectors. These sectors are not included in OECD data. To compare innovation measured by the UKIS with OECD data, we restrict the UKIS results for Scotland and the UK to the smaller group of industries used by the OECD.

The impact of the difference in the sectors covered by the UKIS and the OECD can be seen by comparing the percentages of businesses that are innovation active according to each group of sectors. For the 2020 to 2022 reporting period, 32.4% of businesses in Scotland were innovation active taking into account all sectors covered by the UKIS. Using only the sectors reported on by the OECD, 45.4% of businesses in Scotland were innovation active (Table 23). For the UK as a whole, 36.3% of businesses were innovation active using the UKIS sectors whereas using the OECD sectors, 46.7% were innovation active.

The lead measure of innovation used by the OECD is ‘innovative firms’ as a percentage of total firms. ‘Innovative firms’ are those reporting one or more innovations in the reference period. Innovative firms are those that are either product innovators or business process innovators. The definition of 'innovative firms' excludes innovations that are abandoned, ongoing or scaled back. It is therefore different from the definition of ‘innovation active’ as this does include innovations that are abandoned, ongoing or scaled back.

OECD results are only available for the reporting period 2018-2020. Therefore UKIS data for the reporting period 2018-2020 has been used for the comparison of the percentage of frims that are ‘innovative firms’.

Figure 14: In terms of innovative firms as a share of total firms, in 2018-20, Scotland is ranked in 18th place amongst 34 OECD and partner economies.

Innovative firms as a percentage of total firms, 2018-2020, for Scotland, OECD and partner economies.

Source: UK innovation survey 2023 – results for Scotland - tables from the Scottish Government. For Figure 14 data see Table 23.