From the outset, the UK government’s hefty £20.4 billion investment in research and development (R&D), as outlined in the Autumn 2024 Budget, has the potential to massively impact employment across the innovation and technologies sector.
Whilst the budget includes several initiatives designed to foster innovation, regional growth, and industry transitions, it also brings some challenges, particularly for businesses facing skills shortages and increased employment costs. Consequently, the budget’s measures are likely to affect job growth across the sector in both positive and negative ways.
A significant portion of the funding, particularly the Life Sciences Innovative Manufacturing Fund and investments in green technologies like hydrogen projects, aims to create high-skilled, high-value jobs. These initiatives will likely result in significant job growth in industries such as biotechnology, life sciences, aerospace, and automotive manufacturing. As these sectors expand, there will be wider demands for skilled workers in areas such as engineering, research, product development, and manufacturing.
The emphasis on green technologies investment, including green hydrogen and other sustainable energy projects, also has the potential to create a new wave of opportunities across clean energy. Roles in energy, engineering, environmental science, and project management will be crucial as the UK seeks to establish itself as a leader in the global green hydrogen market.
The government’s commitment to core R&D funding for engineering and manufacturing including for the automotive sector’s zero-carbon transition will require additional skilled workers in manufacturing, wider technical roles, and systems engineering to meet the demands of a rapidly evolving sector.
Within this context the Autumn Budget also emphasises regional innovation accelerators, which aim to spread the benefits of R&D investments across the UK, particularly outside of London and the Southeast. Consequently, cities like Greater Manchester, Glasgow, and the West Midlands will likely see job growth in sectors such as tech, clean energy, and advanced manufacturing.
The £40 million Proof of Concept Fund spread over the next 5 years to support university spinouts is another positive for job creation. As academic research continues to be further commercialised, it will lead to the further formation of new startups and small businesses, creating jobs in entrepreneurial and cutting-edge sectors. With government support, university spinouts could give rise to a significant number of new tech startups, creating demand for skilled professionals in areas like research, business development, operations, and commercial strategy.
The increased funding across healthcare, education, and infrastructure could also lead to job creation across the wider public sector. These funds may be used to hire more healthcare professionals, support staff, and technical personnel to deliver vital services, improving overall job security and stability.
On the flipside of this, there may be challenges in meeting the demand for specialised skills, particularly in sectors such as life sciences, engineering, and clean technology. The UK has already faced skills shortages in certain industries, and while the budget’s investment in R&D is promising, the pace of upskilling and talent development may not be sufficient to match the growing demand for skilled workers. Consequently, as the government seeks to boost industry in areas such as green energy, AI, and life sciences, companies may face difficulty finding the right talent in the UK. This could result in increased competition for highly skilled staff, pushing up salaries – in addition to the NI contributions increase announced by the Chancellor – and leading to talent shortages, particularly in emerging industries such as clean energy and advanced manufacturing.
Overall, the £20.4 billion investment in R&D is a really positive development for job creation, particularly in high-growth industry areas such as life sciences, green technologies, and advanced manufacturing. These investments are likely to lead to significant opportunities in skilled roles, especially in regional clusters outside of London. The success of these initiatives, however, will depend on the ability of both the public and private sectors to adapt to the changing fiscal landscape and create a sustainable, high-skill workforce for the future.
