Innovation activity of Scottish businesses falls behind UK average  

The innovation activity of businesses across Scotland has fallen, continuing a general decline in the rate of innovation happening in the country. 

Between 2022 and 2024, Scotland fell from an innovation rate of 32.4 per cent to 29.4 per cent, while UK-wide innovation rates fell from 36.3 per cent to 34 per cent. The findings were published in a report by the Scottish Government detailing the Scotland-specific results from the UK Innovation Survey 2025.

Innovation activities are classified as the introduction of new or improved products, engagement in innovation projects, new or improved business processes and investment activities in areas such as research, development and training. 

In the report, Scotland was ranked in the bottom quartile of UK regions and countries in terms of its share of businesses that were innovation active, only ranking above Wales, which sits at 27.7 per cent.  

Despite the slowdown, businesses in the ‘Computer and related activities/ICT’ and ‘Scientific research and development’ sectors were most likely to be innovating in Scotland, with an average innovation rate over 70 per cent. The ‘Accommodation and Food Services’ sector was least likely, sitting at just over 12 per cent.  

When asked why they had not innovated, the most common response from businesses was “No need due to previous innovations”, while energy prices were the most important factor constraining innovation activity among companies that had engaged in innovative activities.