This project undertook two new surveys of small and medium sized enterprises (SMEs) across the UK to shed light on (i) the extent to which, in response to the COVID-19 crisis, SMEs have been adopting technologies or organisational practices that we might consider to be “productivity enhancing”; (ii) whether such innovation persists into the longer run; (iii) its impact on firm survival, performance, employment and worker productivity; and (iv) how government policy might promote the persistence of productivity enhancing changes into the recovery phase. This project will build the evidence base on how to best support businesses, helping to build resilience while also understanding the resulting impacts on employment and firm performance. We collaborated with the Confederation of Business Industry (CBI), building on their quarterly surveys of SMEs to include additional questions on technology adoption (and process/product innovation more generally), enablers and barriers – crucially including business views on potential policy levers. The first deliverable was a report summarising the data collected in July 2020, including analysis of heterogeneity by sector, region and firm type. Approximately 12 months after the initial survey we re-surveyed firms to understand any persistence in technological innovation beyond the immediate crisis. We also plan to track company performance via secondary datasets and changes detectible on their websites (e.g. new online offers). The second deliverable was a report summarising the findings of the second survey. We present new data from two surveys of 375 and 425 UK businesses conducted in July 2020 and July 2021 in partnership with the Confederation of British Industry (CBI), which seeks to understand the way in which firms have innovated in response to the pandemic. We find that the pandemic has caused enormous business disruption, which has prompted many firms to focus on innovation.This research project builds the evidence base on technology adoption, and examines how government can best support businesses, in particular small and medium sized enterprises (SMEs), in the UK at a time of crisis. Working in collaboration with the Confederation of British Industry (CBI), this project will design and undertake a new survey of businesses across the UK to shed light on the extent to which, in response to the COVID-19 crisis, businesses have introduced new technologies or organisational practices that are considered "productivity enhancing" in normal times. It will seek to understand the drivers and impacts of such innovation, business perceptions on these, and the relative effectiveness of different business support policies from the perspectives of businesses themselves. Via a follow-up survey one year on (and linking to secondary data sources), we will examine whether such innovation persists into the longer run, its impact on firm survival, performance, employment and worker productivity; and how government policy might promote the persistence of productivity enhancing changes into the recovery phase. The first deliverable will be a report summarising the data, including analysis of heterogeneity by sector, region and firm type. The second deliverable will be a report summarising the findings of the combined initial and follow on surveys. Collaborating with the CBI in these bespoke business surveys will help to create relevant and informative questions on product and process innovation, enablers and barriers to innovation, and business views on potential policy levers for the recovery. The project will seek to inform business support policies to enable firms to survive, adapt and grow out of the current crisis.

The survey was circulated by email to the CBI survey panel, which is comprised of both its members and non-members. The survey was also disseminated separately to CBI members, in sectors which are not covered by its survey panel (principally construction). The survey was distributed via a combination of direct e-mailing and promotion on social media by both the CBI and the London School of Economics. The large majority of firms (97%) were recruited through direct communication from the CBI.