The results of a recent survey from the UK’s Confederation of British Industry (CBI) indicate that the pandemic spurred three-quarters of firms to adopt new technologies, and that the innovation response was stronger among larger and more digitised firms.
We present new data from a survey of 425 UK businesses conducted in July 2021 in partnership with the Confederation of British Industry (CBI), which seeks to understand the ways in which firms have innovated one year on in response to the pandemic. We find that process innovation has been widespread since March 2020: 75% of firms have adopted digital technologies, 55% new digital capabilities and nearly 70% new management practices, and a large share of firms continued to innovate beyond the initial lockdowns. We find similar patterns in terms of the introduction of new products or services. We describe how the self-reported impacts of these technologies on firm performance and on workers differ across types of businesses, technologies adopted and business functions that these technologies relate to. We find that previous technology adoption is a strong predictor of a continued innovation response to the crisis, and that gaps in performance between more and less digitised firms might be expected to widen in the future.