Modern Methods of Construction results in more R&D spending

The UK construction industry has increased its research and development (R&D) spending to a record high of £351m over the course of a year, ONS data has revealed.

The total amount spent on R&D by businesses in the construction sector rose 9.7% annually, or £31m year-on-year, analysis by R&D tax relief specialist Catax shows.

The company said this is partly due to the increased interest in developing Modern Methods of Construction (MMC), an area that is soaking up huge resources as the country seeks to become a world leader in offsite construction.

Mark Tighe, chief executive of R&D tax relief specialists Catax, said:

“The construction industry is a huge employer in this country but contributes a relatively small amount to the UK total of R&D spending.

“However, the sector is experiencing some interesting changes, not least the rapid growth of offsite construction methods. This is likely to be a contributing factor behind this large jump in overall R&D spending last year.

“More broadly, this is the second full year that Brexit Britain has shrugged off the political poison after the EU referendum and posted great gains in terms of R&D investment, running head and shoulders above the long-term average.

“For the first time in history a quarter of a million people nationwide are engaged full time in keeping the UK at the cutting edge. This is going to make a huge difference to Britain’s prospects outside the EU.

“The rate at which UK businesses are adding R&D staff to the workforce remains impressive, virtually matching the previous year with a rise of 7.3%.”

The amount that UK businesses across all sectors have invested in R&D continues to grow, rising £1.4bn to £25bn in 2018 — up 5.8%.

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