Evolution of ICT Manufacturing in Scotland: Implications for a Knowledge Economy
The paper identifies changes in the structure of the Information & Communications Technology (ICT) manufacturing sector in Scotland, with specific reference to the major closures and redundancies announced during the period 2001-03, and examine the implications of these changes for the development of the Scottish knowledge economy. In particular, the relationship between industry restructuring and industry R&D structure is considered. ICT manufacturing is considered to play a core role in economic development, both as a successful producing sector in its own right, and as a source of growth and a driver of productivity in other areas of economic activity. Links are drawn between ICT manufacturing, especially FDI sourced, and a range of benefits at firm and wider economy levels. Drawing on a number of secondary sources and being informed by a series of discussions with industry representatives, the paper denotes a sharp decline in Scottish ICT manufacturing job numbers, export levels, and to some extent, number of employers. However, the economic outputs of the sector, as measured by GVA, has been less severely affected and changes in the scale, composition and character of industry R&D, suggest that the indirect contribution of the sector to the development of a knowledge economy, through mechanisms such as workforce up-skilling, demonstration effects, and linkages with local suppliers and customers are likely to be more prevalent than in the period prior to the 2001-03 restructuring.
Keywords: Regional Economic Development, Information & Communications Technology Knowledge Economy, Research & Development, Innovation, Foreign Direct Investment
Prof. Sean McDonald
Associate Professor of Geography, Department of International Studies, Bentley College
Dr. Alastair McPherson
Evaluation Manager, Strategy and Evaluation, Scottish Enterprise