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Business Enterprise Research and Development Scotland 2008

DescriptionA National Statistics publication on Business Research and Development expenditure in Scotland.
Official Print Publication Date
Website Publication DateFebruary 25, 2010

25 February 2010

A National Statistics Publication for Scotland

This document is also available in PDF format and full tables are available in excel format. NS logo

Further information can be found on the Business Enterprise Research and Development website.


This publication presents information on research and development (R&D) performed by businesses operating in Scotland in 2008 as well as revisions to previously published data for 2007 and 2006. The majority of the data presented in this release come from the Business Enterprise R&D survey conducted by the Office for National Statistics (ONS).

Note that this publication presents the latest statistics for private Business Enterprise R&D (BERD) only. Statistics on Gross Expenditure on R&D in 2008, of which BERD expenditure is a component, will be published in Spring 2010.


Expenditure and employment

The value of Business Enterprise Research and Development (BERD) undertaken in Scotland in 2008 was £547 million, 3.4% of the UK total and 0.48% of Scottish GDP. Expenditure increased from £533 million in the previous year (a 0.1% increase in real terms).

BERD Expenditure 1999-2008

There was a large increase in expenditure on services R&D, while there was a more modest increase in expenditure on R&D in other sectors such as extractive industries. There was a decrease in expenditure on manufacturing R&D. Almost half of Scottish BERD expenditure supported just 2 product groups: 'pharmaceuticals' (27.7%) and 'precision instruments' (18.1%) ( Table 2). Scottish business R&D provided employment for 6,581 people in 2008 ( Table 3).

Regional and international comparisons

In 2008 BERD expenditure was equivalent to 0.48% of GDP in Scotland compared to 1.11% of GDP in the UK.

Within the UK, the bulk of BERD expenditure takes place within the East of England (26%) and the South East (22%) regions. In terms of expenditure as a percentage of GDP, Scotland ranked equal ninth out of the 12 UK regions in 2008 ( Table 4).

BERD expenditure as a percentage of GDP is lower in Scotland than in most competitor countries. In 2008 the average EU BERD expenditure as a percentage of GDP was 1.15%. The leading countries have expenditure levels more than five times higher than Scotland (e.g. 2.78% of GDP in Sweden) ( Table 5).

R&D funding and size & ownership of R&D performing businesses

Nearly three quarters (72%) of R&D undertaken by businesses in Scotland was funded by businesses operating in the UK, 7% was funded by the government and 21% came from overseas ( Table 6). In terms of business size, the largest companies (400 employees and over) accounted for 59% of total BERD expenditure. However, within the services sector companies employing 0 to 99 employees accounted for 76% of services BERD expenditure ( Table 7). USA owned firms undertook 42% of BERD expenditure in Scotland, followed by Scottish based firms (31%) ( Table 8).

BERD Regions 2008BERD Ownership 2008

Background Notes

Sampling and Regional Estimates

1. The majority of the data presented in this release come from the Business Enterprise R&D (BERD) survey conducted by the Office for National Statistics (ONS). The ONS BERD survey is an annual sample survey based on a continually updated register of R&D performers.

2. In 2008, approximately 4,800 questionnaires were sent to businesses in the UK known to perform R&D; this included around 400 of the largest R&D spenders. Smaller R&D performers and others believed to be performing R&D are sampled.

3. The largest R&D performers account for approximately 84% of the total UK expenditure. Each of these large R&D performers is asked to name all the sites at which the business performed R&D and to estimate the R&D spend at that site, this expenditure is then allocated to the appropriate region. Regional data for the smaller R&D performers are estimated from sample returns.

4. A summary quality report for the ONS BERD survey is available at:


5. BERD includes business enterprise R&D performed in Scotland irrespective of the residence of the ultimate owner.

6. BERD excludes R&D funded by Scottish businesses that is performed overseas.

7. BERD excludes R&D carried out by higher education or government (including government departments, agencies and non-departmental public bodies; local authorities; and private non-profit organisations). Public corporations are counted as business enterprises.

8. Gross expenditure on R&D in Scotland in 2008 performed by all sectors of the economy (e.g. business, higher education and government) will be reported separately in Spring 2010.

Discontinuities in the data

9. On 1 July, the government research agency, the Defence Evaluation and Research Agency (DERA) was disestablished and two new organisations were created. Around a quarter of DERA remained within the Ministry of Defence (MOD) as a government agency whilst the remaining three-quarters became a private limited company (PLC). As a PLC, its R&D activities from 2001 are classified and included within the Business Enterprise sector.

Definition of R&D

10. The ONS BERD survey follows the definition of research and development proposed by the Organisation for Economic Cooperation and Development (OECD) and published in the 'Frascati' Manual. According to the manual, R&D is defined as:

"Creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and the use of the stock of knowledge to devise new applications."

11. The definition therefore excludes activities such as market research, most software development, routine testing and quality control and artistic design work.


12. Employment is calculated by respondents to the ONS BERD survey on the basis of 'full-time equivalent' staff averaged over the year. The categories of employment used are:

  • Researchers - engaged in the conception or creation of new knowledge, products, methods and systems.
  • Technicians - perform scientific and technical tasks normally under the supervision of researchers.
  • Others - support staff including skilled and unskilled craftsmen, secretarial and clerical staff participating in R&D projects.

Time period for which the results relate

13. Respondent to the ONS BERD survey were asked to make a return for the calendar year 2008 or the nearest 12 month period for which figures were available.


14. The 2006 and 2007 data have been revised to take account of company misreporting.

15. Table 8 has been revised to show data for the EU27 rather than the EU15 (as previously reported in BERD publications). A back series for 2006 to 2007 on the EU27 basis is available from the BERD website - and a longer back series on the EU27 basis will be added to the website in March 2010.

Additional Tables

16. Additional tables will be added to the BERD website in March 2010. Once the tables have been added an email alert will be sent to those who have registered an interest in R&D and Innovation on ScotStat. You can register your interests on ScotStat at

Issued by:

Business, Enterprise and Energy Statistics
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