Innovation, skills and performance in the downturn: an analysis of the UK innovation survey 2011

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The link between firms’ innovation performance and economic cycles, especially major downturns such as that of 2008-10, is a matter of great policy significance, but is relatively under-researched at least at the level of micro data on business behaviour. It is, for example, often argued that economies need to ‘innovate out of recessions’ since innovation is positively associated with improvements in productivity that then lead to growth and better employment (Nesta, 2009). The issues of how individual firms respond to downturns through their investment in innovation, and how this impacts on innovation outputs and ultimately business performance and growth during and after downturns, has been less studied because relevant data has not been readily available. The UK Innovation Survey (UKIS) 2011 now makes this possible. The UKIS 2011 with reference period 2008 to 2010 covers the downturn in economic activity generated by the global financial crash. The build-up of panels over the life of the UKIS also supports analysis of the longer-term interactions between innovation and the business cycle. This report analyses the last four waves of the surveys. Further, the latest survey includes questions on whether firms employ a specific set of skills, which adds materially to the ability to research the role of skills and human capital in innovation at the micro level.

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... Employees' qualifications and skills are considered a prop to the performance of any organisation (Mohammadi et al., 2017;Frenz and Lambert, 2014;Green and Mason, 2015;Toner, 2011;Schneider et al., 2010;Marion and Ray, 2011;Brandenburg et al., 2007;Tether et al., 2005). Owing to the relevance of innovation to the growth of firms and even a country's economy, the essentiality of the quality of human capital has evolved. ...
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