EARLIER this week we looked at Scotland’s success as an innovation nation and why we need independence to help our country reach its full potential as a pioneering economy. Everyone knows about Scotland’s oil and gas, its incredible food industry and the sheer exporting might of the Scotch whisky sector.

However, rapidly growing new and high-tech industries are also driving Scotland’s economy which is actually more diverse than the rest of the UK which is far more dependent on finance than Scotland is on oil and gas, for example. Today we look at three key Scottish industrial sectors where innovation is paying dividends and the threats they face …


Life sciences is a wide-ranging industry encompassing pharmaceuticals, biomedical science, medical biotechnology, environmental sciences and even some food processing. Basically, these are the sciences that have to do with organisms, such as human beings, plants and animals.

Although there are life sciences businesses across the country, it is an especially important industry in Tayside. Dundee University’s role in life sciences research supports 16% of all jobs on Tayside. Dundee University was ranked as the most influential scientific research institution for pharmaceuticals in the world for the period 2006-16, ahead of the likes of the Massachusetts Institute of Technology and the University of California Berkeley. Edinburgh University was also in the top 10.

Around 770 companies employ more than 41,000 people in this sector in Scotland. The industry body, Life Sciences Scotland, expects the Scottish life science cluster to reach a turnover of £8 billion by 2025, which makes it a key sector in Scotland’s future economy.

This sector’s turnover is already more than £5.2bn per year. Life sciences experienced a 52% growth in turnover between 2010 and 2016 and a 16% employment growth.

The life sciences sector is a major exporter and is highly linked to EU research and European networks for collaboration. However, it is one of a large number of economic sectors which is suffering significantly from the effects of Brexit, because the UK no longer has access to many of the benefits of the EU system, including the centralised procedure for market authorisations, the portal for clinical trials and the pharmacovigilance database.

There is no further mutual recognition of crop protection product marketing applications. Importing materials and access to skilled European labour has also been affected – this is likely to decrease foreign direct investment.

Key facts:

- Scotland possesses one of the largest life sciences clusters in Europe and has the largest community of animal bioscience and aquaculture researchers, with more than 1000 researchers

- Veterinary science in Scotland wins more than 50% of UK veterinary funding. Scotland is renowned for its veterinary science expertise, with its two veterinary colleges at Edinburgh and Glasgow universities ranked first and second in the UK. Almost a third of the UK’s veterinary graduates are trained in Scotland each year

- Scientists at the Roslin Institute in Edinburgh were the first in the world to clone a mammal, which was famously named Dolly the Sheep. The institute has helped generate annual productivity gains of £247m through its breeding and genetics research

- In Scotland, 170 life science start-ups with a success rate of 85% were created between 2009-15

READ MORE: Open Minds on Independence #14: How indy can boost our innovation nation status


Digital industries is a relatively new term that captures the evolving nature of technology in the economy. It blends together the older concept of Information and Communications Technology (ICT) companies and those that are not specifically ICT but operate in the dynamic digital economy. That includes:

- E-commerce and e-business

- Supporting infrastructure (hardware, software, telecom, communications equipment)

- Software publishing for business operations

- Software publishing for entertainment, e.g. the digital games industry

- Online publishing of data and information

- The digital sector is predicted to become the fastest growing industry in Scotland up to 2024, at 38% growth in Gross Value Added (GVA) terms. That is twice as fast as the predicted growth rate of the overall economy (17.5%). This is predicted to reach a target of £5.2bn GVA in 2024, which will create new and highly skilled jobs

The latest available figures demonstrate that approximately 9500 tech companies registered in Scotland in 2018. The sector is growing so quickly that it is predicted to create an extra 12,800 highly-skilled jobs per year.

Continuing that growth of digital industries is key to the future prosperity of Scotland. Some 80% of Scotland’s tech companies expect to employ more people in the coming years. However, the industries’ growth is outstripping the supply of skilled workers and a third of companies say they find it a challenge to recruit the people they need to keep growing. Brexit is making these difficulties even worse.

Key facts:

- Edinburgh was the fastest growing tech hub in the UK in 2017 and has been ranked the most active tech and data innovation city in the UK after London

- The number of firms in Scotland’s digital games sector soared 1800% between 2008 and 2019

- Scotland’s software development sector includes around 7500 companies employing more than 42,000 people and that sector grew 90% in the decade leading up to 2017

- The digital games industry has 1537 full-time games development staff and supports another 2810 jobs

- 75% of Scottish digital tech companies boosted their sales in 2018, compared with 68% in 2017


The space industry is a fast-growing part of the wider aerospace sector, which includes defence and is estimated to be worth £6.4bn to the Scottish economy. The space sector is the largest segment, contributing £2.6bn gross domestic product (GDP) to the Scottish economy directly and as much as another £1bn through its supply chain.

Space industries are of growing importance to Scotland, where about 20% of all the UK’s space-related jobs are based. There are approximately 132 space-related organisations operating in Scotland, 83 of which are headquartered here – a 27% increase on the previous year. The space sector in Scotland supports 7500 jobs, creating on average 300 jobs a year. The Scottish Government expects the space sector to be worth £4bn by 2030.

It should come as no surprise that the largest threat to this sector is Brexit. Although membership of the European Space Agency (ESA) is not tied to EU membership, no grants to encourage space research and development (R&D) have ever been given to a country outside of the European Economic Area (EEA), which consists of EU and EFTA members.

Sutherland in Scotland has been named as the location for the UK’s first spaceport, although an objection has been lodged and a judicial review hearing is expected. AstroAgency, which has its headquarters in Scotland, has won funding from the UK Space Agency to establish a space hub on behalf of the Scottish Space Leadership Council (SSLC), and Prestwick Airport has received £80m to enable space-related activities.

Key facts:

- Scotland, with 8.2% of the UK population, employs nearly 20% of the UK’s space sector

- The UK Space Agency shortlisted six Scottish locations out of eight for horizontal launch spaceports, demonstrating that Scotland has the best launch areas for reaching key satellites

- Glasgow builds more satellites than any other European city

Our economy seems to be proving remarkably resilient in the face of Westminster’s lack of re-investment, Brexit and being part of a larger UK whose government doesn’t focus its business, economic and innovation policies on Scotland’s needs. There is no advantage to Scotland’s economy – its old established sectors and its – emerging fast-growth industries that could not be bettered by a focused industrial strategy from a government targeting their needs from Scotland for Scotland.