Growing Businesses

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The other area within the theme of Growing Businesses that was highlighted by Scottish Enterprise was the commercialization of research and innovation. Research and Development spending in Scotland as a % of GDP is about half the UK average. It ranks below all North West European countries. On another related measure, Academic Spinout, Scotland exceeds the UK average by 25% per million of population. It ranks third amongst the UK regions, however, the trend is negative. The number of spinouts has decreased from 38 in 1999 to 24 in 2001 and 23 for 2002. For 2001/ 2002, Scottish institutions were also granted 167 new patents and 102 licenses for the use of their intellectual property. Together, these commercialization activities exceed 13% of the UK total.

The second theme of Smart, Successful Scotland is Global Connections. Under this theme, the key areas are Digital Connectivity, Involvement in Global Markets, Globally Attractive Location and Choosing to Live and Work in Scotland14. As for Digital Connectivity, Broadband access costs across the UK were the highest compared to other OECD countries15. There has been a large change as to the coverage, which increased from 34% in 2002 to 81% in 2004 across Scottish Households.

Involvement in Global Markets is measured by export activity and interactions with overseas companies. Scottish Exports in 2000 were 56% of its GDP. This decreased by 23% by 2002, whilst total UK exports increased slightly at the same time. The proportion of graduates in the workforce and the availability of international transport links are measures for the attractiveness of the country. The first figure increased slightly from 17% in 1999 to 18% in 2000. By 2003, it had reached 98% of the UK average. The latter saw a significant increase. 69% more destinations could be reached directly from Scotland in 2003 than in 1999.

The third theme is Skills and Learning. For this, performance measures are the proportion of the working age population in employment, skill shortages and, the ratio of unemployment to unfilled vacancies. In2002, Scotland ranked average amongst OECD countries with 70.5% of its working age population in employment. This was slightly below the UK average. This figure has increased from 67.9% in 1999. However, this can partly be attributed to an increase in part-time work. In that same period, self-employment increased above the UK average. In 2003, skill shortage vacancies totaled 0.58% of employees. Within the UK, this number was lower only in London and the North West.

Many changes have been made as to the objectives and targets of Scottish Enterprise, since the Fraser of Allander report highlighted many inefficiencies in 2001. However, post 2001 data is not easily available and as performance measures have changed, statistics of some indicators were not compiled pre-2001. This makes a direct comparison difficult. It can be held though, that the agency’s strategy changed as a result of it not meeting its targets and widespread criticisms.

The period since changes have been introduced is fairly short, however, it becomes clear that although improvements have been made, these are often still below target. As the Regional Survey of UK Economic Trends shows, in 2004, many businesses were still dissatisfied with the support received through government agencies and therefore with the work of Scottish Enterprise.

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