Knowledge economy managers ruling the world


Britain's knowledge-based industries have created more new jobs over the past decade than their rivals in traditional sectors, most of them at manager level.

A study by the UK think-tank The Work Foundation has suggested that Britain is rapidly becoming a world leader in the trade of such "knowledge services", with small and medium sized business in particular at the forefront.

The foundation is half way through a £1.5m research programme into the so-called "knowledge economy" and has published its initial conclusions.

Knowledge economy jobs now encompassed high to medium-tech manufacturing and services, financial services, health and education, cultural and recreational services and international transport services, it argued.

And "knowledge workers" were generally managers, professionals or technical experts with a degree or other form of higher education qualification.

For instance, two thirds of the critical contribution of the City of London and other financial services to the UK economy now came from knowledge-based business services, high tech and education and cultural services, it said.

Between 1995 and 2005 small and medium-sized firms have dominated the knowledge economy, in particular accountancy, legal and consultancy services, architecture, engineering, technical services and advertising.

Such SMEs had increased the numbers of people they employed by 17 per cent, or 445,000 people, in that decade.

And, so far, offshoring of knowledge-based jobs, while a growing trend, had had little impact on knowledge economy jobs, the foundation said.

Occupations theoretically at risk from offshore outsourcing continued to add numbers overall in the UK.

The trade in knowledge services remained overwhelmingly with richer countries, rather than developing nations such as India, it argued.

Ian Brinkley, Work Foundation director and author of the report, said: "You can see the knowledge economy in the industries that flourish most today and in the kinds of jobs that more people do, but perhaps most of all in the ways that organisations today search for competitive advantage.

"Value is extracted from intangible things such as ideas, R&D, software, design and marketing, human and organisational capital, in a way that was not the case in previous eras. No one can point to it, but it is becoming more real in advanced nations as the 21st century unfolds.

"In the time that remains in the programme, we shall be teasing out what the knowledge economy means practically for organisations and for the kinds of work that individuals do," he added.

A year ago the foundation urged Prime Minister Gordon Brown to make the knowledge economy one of the "big ideas" of his premiership.