HSBC report predicts UK will become pioneer in knowledge industries

British industry is headed for the biggest shakeup since the Industrial Revolution, with the country set to be a pioneer in video games, superfoods and robotics, according to a new study.

With dark Satanic mills long gone, the HSBC Future of Business report predicts that five "supercities" – Brighton, Leeds, Liverpool, London and Newcastle – will emerge as knowledge industries gain traction instead of natural resource-based businesses.

The Britain mapped out by the researchers foresees factories, power stations and livestock supplanted by centres for gaming, windfarms and robotics as the economic landscape is redrawn around the "tropics of knowledge and next generation industries". The findings are based on interviews with 500 entrepreneurs and company directors.

"Our panel predicted the rise of supercities and regions over the next 20 years," said Martin Raymond from the Future Laboratory, one of the report's authors. "They promise to change the traditional national and regional power bases because of their proximity to the one thing that does not depend on natural resources: knowledge."

The authors say change is being accelerated by the recession. "Business used to be cyclical, rhythmic and geographically specific," said Raymond. "Now it is increasingly rootless, borderless and weightless. It is defined as much by our ability to see opportunity in ideas, knowledge and intellectual resources as it is to profit from trading in real products and tangible assets."

This is forcing businesses to adopt more flexible ways of working, says the report, while spurring on technological advances and global trade. Raymond says the supercities and regions will derive their status and income from new income streams such as biotechnology and stem cell research.

The research also predicts the north/south divide will shift as London's economic output wanes. The report says competition and high living costs in the south is encouraging entrepreneurs to move north. Job creation by self-employed people is also higher in the north, with northerners employing 3.5 million people on average, compared with 2.6 million in the south.

With its traditional "jute, jam and journalism" now faded, the report predicts that Dundee will emerge as a hub for biotech, video gaming and nutraceuticals (foods with health and beauty benefits). The nutraceuticals industry is already worth £50bn worldwide and is expected to grow with an ageing population and rising obesity levels. Scotland's digital media and creative industries are worth an estimated £5bn, with top-selling titles such as Grand Theft Auto developed there. The research also suggests there is life outside financial services for London, which is expected to win renown for work in nanotechnology, robotics and stem cells.

Source: The Guardian

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