West Midlands home to largest emerging technologies cluster outside London, new UK-wide study reveals

West Midlands home to largest emerging technologies cluster outside London, new UK-wide study reveals

As London Tech Week (20 – 24 September 2021) gets underway, a new comparative study of the country’s future tech capabilities reveals that of all UK regions, the West Midlands is home to the largest emerging technologies cluster outside the capital.

Led by London Economics* and glass.ai**, analysis of the country’s core city regions found the West Midlands has the largest spread of up-and-coming tech strengths, as well as the highest number of companies developing new tech, surpassing the volume of expertise in both Greater Manchester and Leeds City Region respectively.

All disciplines and sub-sectors under Advanced Manufacturing; Data-Driven Healthcare; Future Mobility; Modern Services; Smart Cities; and Tech & Creative were examined for the report, in recognition of their strategic significance for attracting Foreign Direct Investment (FDI).

In Tech & Creative specifically, a deep dive identified the West Midlands as the most established out-of-capital destination for the industry, with the largest number of companies in 10 out of a total 13 specialisms, including digital transformation; gaming; immersive tech; process automation and software development.

Automotive and transport tech are where the region has been found to have an absolute advantage over other UK locations – including London – counting the high-demand investor markets of Connected and Autonomous Vehicles (CAV), battery tech, electric engines and rail tech as the strongest local sub-sectors.

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The study further highlights the extensive role that the region’s enterprise support facilities play in stimulating tech-led innovation, noting a higher density of business accelerators per 10,000 businesses in Greater Birmingham and Solihull than anywhere else in the UK, including London.

The findings follow the recent launch of the UK Government’s Innovation Strategy, where emerging tech is pinpointed as a vital catalyst for advancing industries and futureproofing the UK’s globally competitive economy, post EU-exit.

Dan Storer, Chief Investment Officer at the West Midlands Growth Company*** – the region’s official investment promotion agency – said:

“This report corroborates the prevalence of tech-led innovation throughout the West Midlands economy, asserting the region as one of the UK’s standout locations for digitally-integrated expertise.

“It highlights the interdisciplinary opportunities that have arisen from combining the region’s R&D strengths with its abundance of technically-abled talent. Be it future mobility technologies, medical devices or process automation, the West Midlands is both harnessing and driving digital transformational across industry to deliver frontier, coveted solutions to market.”

5G is the region’s primary innovation asset accelerating emerging tech. The West Midlands is the UK’s first multi-city testbed under the Government’s 5G Tests and Trials programme and the country’s top regional location for 5G signal coverage. Regional businesses of all sizes have unique access to test, prove and scale new 5G services and applications across the foundational sectors of health & social care; transport; and notably manufacturing, where the West Midlands is predicted to benefit from the highest GVA increase of any other English region – according to recent analysis from mobile operator Vodafone.

West Midlands manufacturers are leading the industry’s 5G adoption, with Birmingham-based high-precision machining firm AE Aerospace the first UK SME to deploy a private network.

In partnership with West Midlands 5G (WM5G)****, the company is conducting industry-first trials of the network to improve productivity and efficiency in its operations. The firm has installed a permanent 5G connection at its factory, and is developing use cases to explore how 5G can support connected devices (the Internet of Things) to maximise active machine time, utilise predictive maintenance and provide more accurate assurance on machining precision.

Robert Franks, Managing Director of WM5G, said:

“Manufacturing is a leading economic driver for the West Midlands and will be a fundamental part of the region’s post-Covid recovery. Through the implementation of 5G technology, manufacturers such as AE Aerospace can transition their businesses to the next level by creating new revenue-generating opportunities, increasing both productivity and efficiency within the factory setting.

“We are very proud to be supporting AE Aerospace in delivering these use cases and providing tangible solutions to genuine challenges.”

The Emerging Tech Capabilities in the West Midlands study also confirms the region’s sector-leading influence in R&D, with £2.4bn of investment in R&D activities made by businesses in the West Midlands in 2019, accounting for approximately 9.1% of the UK’s total expenditure.

The report’s science and innovation audit additionally acknowledges the success of West Midlands universities in creating collaborative public-private research partnerships to drive the internationalisation of tech-related innovation, such as Warwick Manufacturing Group’s co-project with Jaguar Land Rover and Tata Motors European Technical Centre to establish the National Automotive Innovation Centre– the largest automotive research facility in Europe.

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The UK’s new Innovation Strategy addresses the integral role that regions, like the West Midlands, have to play in unlocking the country’s science and innovation potential, with greater focus on R&D funding outside London and the South East among the key measures announced, ahead of a formal Levelling Up white paper due autumn 2021.

Dan Storer added: “The Innovation Strategy sends a clear signal that R&D investment is a priority measure of economic performance for Government. As the UK’s pre-eminent location for emerging tech and among the top regional R&D spenders, the West Midlands continues to prove its pioneering worth – which we hope will be widely recognised through further levelling up outcomes in the coming months.”

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