Most businesses plan to increase or keep up their spending on innovation in the wake of the UK's vote to leave the European Union, according to a survey.
Seven out of 10 businesses plan to increase or maintain their innovation spending, with less than one in ten expected to reduce investment, according to a survey released by the CBI in partnership with Deloitte and Hays.
According to the survey of more than 800 businesses by the CBI, last year business invested almost £21bn on innovation.
This allowed British firms to develop cutting-edge products and services, attract global investment and expand internationally.
However, the UK only rates as the 10th in the world for innovation for companies.
While some firms view the UK as a world-beater in areas such as access to scientific research (35 per cent) and tax incentives to support investment (30 per cent) – the UK lags behind in other crucial areas.
Businesses rate the UK as a follower in areas such as partnering with external companies (21 per cent) and grant funding (14 per cent).
In order to support businesses’ ambition to make the UK an innovation powerhouse, the CBI is calling on the UK government to commit to a long term-target of 3 per cent public and private spend on research and development.
Looking ahead to the upcoming EU negotiations, firms have a number of top priorities that will enable them to innovate in the future – access to skills (66 per cent), tariff-free access for goods (41 per cent) and keeping common regulatory standards (38 per cent).
Carolyn Fairbairn, CBI director general , said: “The UK will need to work hard to become the front-runner in global innovation, creating a pioneering economic role for itself in the world that drives prosperity in every corner of the UK.
“Innovation is the nucleus of future economic and social development, so it’s encouraging that seven out of ten firms will keep up - or even raise – their spending on new technologies and work practices to grow their business.
“As we prepare to depart the EU, this shows that firms are rolling up their sleeves and looking to make the best of Brexit."
She added spending on innovation generates jobs and economic growth across the country, but sounded a note of caution.
“While the UK has many innovation strengths to build on, businesses are worried that the country is too much of a follower in the global economy, with the lack of access to technical skills a grave concern for ambitious firms."
The survey also found that customer service (24 per cent) and product development (30 per cent) are seen as two key areas that would benefit from greater innovation
Top priorities are to increase collaboration and partnership (65 per cent), greater access to technical skills (68 per cent) and increased government support (56 per cent).
In addition, 44 per cent of firms believe that the main benefits of automation are increased productivity, an improved product or service (24 per cent) and higher customer satisfaction (15 per cent).