Software, organisational capital and training drive surge in 2023
The UK poured a record £244.7 billion into intangible assets in 2023, according to new figures from the Office for National Statistics, marking a 6.3 per cent rise on the previous year and continuing a three year run of above average growth .
The data, published last week, shows that intangible investment, covering software, research and development, branding, organisational capital and more, outstripped spending on physical assets by £85.3 billion, underlining the economy’s long term shift towards knowledge based growth.
Software remains the UK’s biggest intangible asset
Software and databases accounted for the largest share of investment, totalling £57.2 billion. Of this, own account software, technology developed in-house by firms, saw a striking 19.9 per cent increase, rising by £7.1 billion in a single year .
Research and development remained a major component of intangible investment, reaching £45.8 billion, with scientific research and development firms leading the spend. Firm specific training also continued its post pandemic rebound, totalling £38.3 billion.
Meanwhile, organisational capital – managerial and operational capability built inside firms, was the largest uncapitalised intangible asset, valued at £42 billion.
Professional services and tech industries lead the way
Professional, scientific and technical activities were the biggest investors by sector, contributing £48.6 billion. Nearly 40 per cent of their spending went into R&D, reflecting the sector’s reliance on innovation driven growth .
Information and communication firms followed closely at £35.9 billion, making them the most intangible intensive sector in the UK, with investment equivalent to 21.6 per cent of gross value added – a level that has remained stable for more than two decades.
Manufacturing, still heavily reliant on research and development, invested £34.0 billion, while industries such as retail, wholesale and construction showed broad based increases across branding, training and design.
Spending proves resilient through economic shocks
The figures highlight the stability of intangible investment over time. Charts in the ONS bulletin show that intangible spending has remained consistently higher than outlays on physical assets since 1998, and has been less volatile during downturns, including the late 2000s financial crash and the coronavirus pandemic .
While growth slowed modestly from the highs of 2022, both capitalised and uncapitalised intangible assets continued to expand, with branding, organisational capital and design all recording gains.
Record investment per worker
A further measure shows the UK market sector invested a record £9,900 per worker in intangible assets in 2023. Financial services and information and communication firms were the highest investors per head, exceeding £20,000 per worker for the second consecutive year .
The ONS cautions that the data remain “official statistics in development” and are subject to future revision, as methods for valuing intangible assets continue to evolve.
