Gross expenditure on research and development Scotland 2023

Expenditure and components of GERD

In 2023, Scotland’s Gross Expenditure on R&D (GERD) was estimated at £5.02 billion, 6.9% of total UK GERD. This is an increase of 2.6% (£125 million) since 2022 in cash terms. However, due to high inflation, this cash increase meant that Scotland’s GERD fell by an estimated 3.4% in real-terms between 2022 and 2023; compared with a fall of 1.7% for the UK as a whole. In both cases, the reductions were mainly due to real-terms falls in business enterprise R&D (BERD) expenditure.

The largest components of R&D expenditure in Scotland in 2023 were the business sector, at £2.70 billion (53.8% of GERD), followed by the higher education sector, at £1.95 billion (38.9% of GERD).

Figure 1: Business enterprise R&D (BERD) expenditure accounted for the majority of GERD in Scotland and the UK in 2023. However, compared to other regions of the UK, BERD spend as a share of GERD is relatively low in Scotland (53.8%), whilst the higher education R&D (HERD) spend as a share of GERD is relatively high (38.9%).

Composition of GERD by UK country/region, 2023.

Source: Gross expenditure on research and development Scotland 2023 - tables. For Figure 1 data see Tables 2A, 3A, 4A, 5A, and 6A.

Note that Northern Ireland, Wales and the English regions of ‘North East’ and ‘Yorkshire and the Humber’ are not included in Figure 1 because private non-profit (PNP) expenditure on R&D, and therefore GERD, estimates for these regions have been removed to protect confidentiality. Estimates for these countries/regions are included in the UK figures.

The estimate of GERD as a share of Gross Domestic Product (GDP) in 2023 was 2.50% for Scotland, compared to 2.64% for the UK as a whole.

Business enterprise R&D (BERD) expenditure as a share of GDP was estimated to be 1.34% for Scotland in 2023, compared to 1.82% for the UK as a whole. BERD spend in Scotland accounted for 5.4% of total UK BERD. Scotland ranked 8th out of the 12 UK countries/regions in terms of BERD spend as a percentage of GDP. East of England was highest, at 4.25%, Wales was lowest, at 0.90%.

BERD spend in Scotland decreased by 0.8% in cash terms (i.e. before adjusting for inflation) between 2022 and 2023, compared with an increase of 2.9% in the UK as a whole. In real-terms (i.e. after adjusting for inflation), BERD spend fell by 6.6% in Scotland between 2022 and 2023, compared with a reduction of 3.1% for the UK as a whole. BERD spend fell in most of the 12 UK countries/regions between 2022 and 2023. The largest reduction was in the South West, with London having the highest increase.

Higher education R&D (HERD) expenditure as a share of GDP was estimated to be 0.97% for Scotland in 2023, compared to 0.62% for the UK as a whole. HERD spend in Scotland accounted for 11.4% of total UK HERD spend. Scotland ranked top out of the 12 UK countries/regions in terms of HERD spend as a share of GDP. Northern Ireland was lowest at 0.46%.

HERD spend in Scotland increased by 4.4% in cash terms (i.e. before adjusting for inflation) between 2022 and 2023, compared with an increase of 5.3% in the UK as a whole. In real-terms (i.e. after adjusting for inflation), HERD spend in Scotland fell by 1.6%, compared to a fall of 0.8% for the UK as a whole.