40% of UK firms invested in their IT during the pandemic
Although research also suggests R&D fell sharply during the same period
Around 40% of UK firms have invested in their IT during the pandemic, according to new research, in what is thought to be the result of having to facilitate working from home and remote engagement with customers.
Only 13% of firms ceased their investment in IT, according to a report from Durham University Business school which interviewed over 4,500 UK companies between October and November 2020.
“Whether such investment will enhance growth in the medium to long-term depends upon the extent to which employers continue to allow their employees to work from home and how productively people can work from home,” it states.
It also suggests that remote working may have positive effects on productivity “and therefore that this type of investment is likely to be growth-enhancing”.
“The COVID-19 pandemic has had profound effects on the world economy, and in the UK specifically Bank of England figures suggest that it has led to the largest fall in GDP since 1709,” said Richard Harris, professor of economics at Durham University. “While the short-run effects of the early stages of the pandemic are now well understood, less is known about its implications for growth in the medium to long-term.
The research from Durham University Business School examined the effect of the pandemic on UK firms’ research and development plans and whether or not companies have refocused their efforts elsewhere in terms of investments.
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It found that 45% of all UK firms had reduced their investment in research and development, with 18% halting investment entirely. The findings suggest that this decline will “have long-lasting negative effects on productivity and growth for firms".
In September last year, the UK’s tech industry helped the jobs market through the pandemic with vacancies rising by more than a third over the summer. After healthcare, the tech sector posted the highest number of vacancies, with roles jumping by 36% since June. Furthermore, there was evidence tech companies were starting to recruit for non-STEM roles as there had been a rise in advertising for non-technical roles.
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