Universities' support for the economy increasing in tougher times

13 July 2009

Universities and higher education (HE) colleges in the UK provided ideas and services worth £2.812 billion (Note 1) in 2007-08, according to an annual survey published today. This is the highest level on record and a rise of 6.5 per cent on the year before.

The Higher Education - Business and Community Interaction Survey ^{(Note 2)} provides a comprehensive look at how HE exchanges knowledge with business and community partners, stimulates innovation, develops human capital and generates new enterprise, to the benefit of businesses, public services, and the wider community. The survey highlights some of the ways in which HE is stimulating new enterprises, helping them to prepare for an economic upturn. These include:

supporting 1,977 graduates and 41 members of staff to set up new businesses
creating 219 new companies based on university intellectual property ('spin-offs')
the number of graduate and staff start-up enterprises surviving for three years or more has risen to 1,322 and 155 respectively
over 900 spin-offs also passed the three-year marker.

The survey also describes a range of services provided directly to businesses and other economic and social organisations. Growth in income for HE services reflected the most immediate priorities of different user groups in these more difficult market conditions. The main features are:

Consultancy support for small and medium-sized enterprises (SMEs) from HE, which could give them direct solutions for business problems, rose by 25 per cent (£58.5 million) in 2007-08.
The total value of contract research grew to £835 million in 2007-08, representing a 6.6 per cent increase from 2006-07. Income from contract work with large commercial companies rose 10.6 per cent over the same period.
More speculative, longer-term investment in collaborative research grew to over £697 million, representing a 4.2 per cent increase between 2006-07 and 2007-08.
Access to specialised facilities in universities – particularly valuable to companies, allowing them to use state-of-the-art equipment such as mass spectrometers or supercomputers without the major expense of buying it for themselves – grew by 11.6 per cent (£103.5 million) from 2006-07 to 2007-08.
Support to individuals coping with the recession is a key priority for HE now, and the survey demonstrates a strong track record in this area, with an 11 per cent (£537 million) increase in income from continuing professional development activity.

HE has maintained a balance between supporting existing businesses and generating new enterprises for the future. Alongside spinning off new innovative businesses, universities also significantly increased their licensing of ideas to help existing businesses. Overall, income from licensing increased by 11.3 per cent to £45 million in 2007-08.

HE is now providing new forms of support, such as internships, and offering lower-charged services for local and community enterprise: these are described as examples in the Universities UK brochure 'Standing Together' and outcomes of HEFCE's Economic Challenge Investment Fund.

HE also seeks to enrich their local and wider communities through social and cultural programmes. In 2007-08, 750,000 people attended free public lectures provided by higher education institutions (HEIs).

Science and Innovation Minister, Lord Drayson said:

'It is great to see our universities contributing so much to the economy. It's not just about money but also expertise, innovation and helping the UK remain at the cutting edge of science and research.'

Sir Alan Langlands, Chief Executive of HEFCE, said:

'This survey demonstrates the critical role that the higher education sector plays in delivering vital services to the business world and to society. Universities and higher education colleges are helping the economy in many different ways, by supporting new businesses, by creating ideas for commercial exploitation, and by preparing graduates entering the labour market. By providing £2.8 billion-worth of services to business, the higher education sector can truly demonstrate, through this survey, its worth and growing importance to the UK economy.'

Notes

This figure is the total income to universities and HE colleges for the services they provide.
The Higher Education - Business and Community Interaction Survey (HEFCE 2009/23) is published jointly by the Department for Business, Innovation and Skills (BIS) and HEFCE. It was produced by HEFCE on behalf of several stakeholders within Government including BIS. The survey is the most complete of its kind in the world.
From 2008-09, the HE-BCI Survey becomes fully embedded in HE data collection systems, with the survey to be compiled by the Higher Education Statistics Agency.
160 UK HEIs responded to the survey.
Patents are only one way of protecting certain types of intellectual property. For more information see the Intellectual Property Office.
A 'spin-off' is an enterprise that has one or more of the following attributes:
- an HEI or HEI employee(s) possesses equity stakes
- it has been created by the HEI
- it has been set up by HEI employees to enable the commercial exploitation of knowledge arising from academic research.
Due to developments in the annual survey process, not all indicators can be viewed over all years. Those provided in the table below are sufficiently robust to form a trend.
Some additional selected data from the survey are given in the table below:

Indicators from the HE-BCI survey (all UK)	Academic year
Income from UK HEIs/ £M (real terms)	2000-01	2001-02	2002-03	2003-04	2004-05	2005-06	2006-07	2007-08	2008-09
Collaborative research	496	550	544	599	573	629	687	697	n/a
Contract research	n/a	n/a	n/a	639	666	687	804	835	n/a
Consultancy	124	143	191	233	242	255	296	335	n/a
Equipment services	31	59	76	88	82	95	95	103	n/a
Regeneration	n/a	n/a	144	239	225	239	272	238	n/a
Continuing professional development	n/a	n/a	n/a	326	408	425	498	537	n/a
Intellectual property income (non-software + software licences)	n/a	n/a	30	34	39	44	41	45	n/a
Total intellectual property income (including sale of shares)	n/a	n/a	42	42	61	61	60	66	n/a
Outputs from UK HEIs	2000-01	2001-02	2002-03	2003-04	2004-05	2005-06	2006-07	2007-08	2008-09
Patent applications	n/a	n/a	n/a	1,308	1,648	1,536	1,913	1,898	n/a
Patents granted	n/a	n/a	n/a	463	711	577	647	590	n/a
Formal spin-offs established	n/a	n/a	n/a	167	148	187	226	219	n/a
Formal spin-offs still active after three years	n/a	n/a	n/a	688	661	746	844	923	n/a
% UK HEIs that provide:	2000-01	2001-02	2002-03	2003-04	2004-05	2005-06	2006-07	2007-08	2008-09
Enquiry point for SMEs	83%	85%	n/a	n/a	89%	90%	91%	91%	93%
Short bespoke courses on client's premises	63%	67%	n/a	n/a	78%	80%	84%	83%	88%
Distance learning for businesses	53%	52%	n/a	n/a	66%	66%	68%	68%	68%
Required contracting system for all consultancy	60%	65%	n/a	n/a	66%	68%	73%	75%	75%