Tomorrow's Employment Lies in Innovation and the Knowledge-Based Economy

Today, innovation is necessary to survive. The global market has become so competitive that innovation is now as valuable an investment as sales and marketing. Markets are becoming more global, not less, so the value of innovation will continue to increase. It is not just the invention of a new idea that is important but it is actually bringing it to the market, putting it into practice and exploiting it in a manner that leads to job and wealth creation. Recessions can be a breeding ground for innovation activities and entrepreneurship, generating new sources of growth. Companies like Microsoft, Google, Nokia, Blackberry were all born, or reborn, during an economic downturn. In fact, over half of the companies on the 2009 Fortune 500 list began during a recession or bear market.

The importance of innovation as a driver of growth was recognised in many of the stimulus packages that were launched to offset the impact of the recent economic crisis. Many countries increased their public investment in education, research and ‘smart’ infrastructure to strengthen their growth performance. But now, with the weight of fiscal deficits, there is a risk of such spending being cut. This would be a mistake. While cuts may provide short-term fiscal relief, it will hurt growth in the long term. But this not just about spending.