Global connectivity is key to the UK becoming a “services superpower,” according to new research

• Study from WPI Economics reveals key sectors reliant on international access are projected to grow faster than rest of UK economy in next 10 years, which is worth an extra £10.6bn
• Growth could be turbo-charged if policy-makers support sustainable plan for aviation, says boss of UK’s largest group of airports
• Leaders from high-value industries like life sciences, advanced manufacturing and financial services say strong air links are key to their future success

Leading voices from the country’s most important industries say strengthening the UK’s global connectivity is key to it becoming a “services superpower.”

World-leading firms including  AtkinsRealis, WSP and Arup - as well as SMEs and business groups - believe their sectors have the potential to jump-start the economy but warn that, as an island nation, the UK relies more than most on direct air links to be globally competitive.

They were responding to research released today by MAG (Manchester Airports Group), which concludes that if the UK wants to “double down” on its status as the world’s second largest exporter of services, a strong sustainable aviation sector will be needed to underpin that.

The study - from WPI Economics looked at 10 traditional sectors - including financial services, the creative industries and real estate - all of which are particularly reliant on international connectivity for their success. They are projected to grow two percentage points faster than the national average over the next decade - equal to £10.6bn of extra economic value. To read the full study, click here.

It also profiled four fast-growing sectors – advanced manufacturing, life sciences, fintech and advanced digital – which also depend on global connectivity and are expected to grow rapidly in the coming years as they have five-year growth rates of 51%.  

According to the report, the growth of all these industries could be undermined if the UK’s international connectivity weakens in the years ahead - but could also be turbo-charged if the sustainable growth of aviation is supported by policy-makers.

The report – called “Services Superpower” - was launched at a special Parliamentary reception, where service sector leaders were joined by Shadow Business Secretary Jonathan Reynolds.

They heard from Ken O’Toole, CEO of MAG – which owns Manchester, London Stansted and East Midlands Airports. He said: “The fact the UK has world-leading expertise in a number of high-value sectors should be a source of both pride and optimism, as focus intensifies on how to achieve transformative economic growth.“But if we want to double down on the things we are already good at, then we need to understand what these industries need to fulfil their potential – and it is clear from this important research that strong international connectivity is of critical importance, especially as an island nation.“That is why we need to accelerate the plan to grow aviation sustainably, so that businesses in these sectors can reap the benefits of having better access to the world through airports in all parts of the UK. Whoever forms the next UK Government must place that at the heart of their economic plan for the country."

The report notes that the UK is behind only the United States and ahead of the likes of Germany and China when it comes to services exports. It also ranks fourth in Harvard University’s ‘Global Outgoing Knowledge Index,’ making a major contribution to the world economy through the value of the expertise it exports. It is estimated that if business travel from the UK were to stop, almost 1% of total global GDP would be lost.

At the same time, the UK was the most internationally connected country in Europe in 2019, while growth in global business travel outstripped that seen by countries including France, Australia, the US and Spain last year.

The 10 traditional sectors profiled by researchers – which also include electric power generation, insurance and hospitality - collectively contribute £643bn and 4.2m jobs to the UK economy each year.

Using proprietary machine-learning technology, they also looked at four emerging, high-growth sectors: advanced manufacturing, fintech, life sciences and advanced digital. Between them, they had combined turnovers of £110bn in 2023 and have five-year growth rates of 51%, indicating they are likely to grow even faster than the national average, with the right conditions in place.

The release of the report builds on findings from the Resolution Foundation ‘Ending Stagnation’ study, which concluded that to turbo-charge UK productivity, it should focus on the things it is already good at and become a services sector superpower.

It also points to a significant opportunity to rebalance the economy by accelerating the growth of the identified sectors in regions outside London by boosting connectivity to and from airports in all parts of the country. For example, 38.5% of the GVA generated by the 10 profiled sectors in 2023 was concentrated in London, with 7.8% in the North West, 4.2% in the East Midlands and 5.6% in the Yorkshire and Humber.Researchers spoke to a series of entrepreneurs, business leaders and trade groups to inform the study, and they today called on policy-makers to support a strong aviation sector.

Mike McNicholas, Managing Director Infrastructure, UK & Ireland at global engineering specialist AtkinsRéalis, said: “As a world-leading design, engineering and project management organisation, being able to connect people is critical for us, and that is why international connectivity, physical and digital, is absolutely vital to the future of our business, our growth plans and our ongoing success as a global operator.“Overall, we know that people like people and in-person engagement is a crucial part of creating new relationships and getting things done - when we have the right people in the room together, relationships grow and ideas flow.“As a business, sustainable aviation is so important to our future, and we believe it is crucial for policymakers to recognise the value of high-quality global trade links that air connectivity provides. As an exporting island-nation, it is so important to get this right.”

Giulio Corte, Technical Director and Sustainability & Climate Change Aviation Lead for WSP, said: “As a leading multi-disciplinary professional services consultancy, promoting sustainable growth is at the heart of WSP's vision. “The aviation industry is vital to enhancing national and global connectivity and is an essential enabler to propel the UK's economic prosperity. Alongside MAG and other partners, we firmly champion the vital need for direct routes to key economic hubs, to catalyse economic growth and opportunity. “In doing so we are wholly committed to contributing with our expertise to the decarbonisation and climate change emergency response of the sector, by pioneering innovative solutions that pave the way for a smarter, greener and resilient future."

 John Fagan, UKIMEA Transport Leader, Arup, said: “As a global engineering firm, Arup expertise has increased value and lowered carbon emissions for airport operators while enhancing passenger experience at many of the world’s busiest aviation hubs. A sustainable growth plan for aviation will ensure the sector continues to contribute to the UK’s economic growth and boost jobs while enabling Arup to work on projects that continue to deploy our expertise in sustainable development, design, and innovation. “We have been involved in the aviation sector for more than 60 years, with experience through a wide range of assignments at more than 100 airports worldwide, including Manchester Airport. Advising most of the world’s leading airports, we are globally recognised as a trusted aviation services partner. The aviation sector will continue to play an important role within our transport business.”

 SpaceZero and Kampus International are Manchester-based specialist designers of schools, colleges and universities. CEO Wayne Taylor said: “Given the number of countries we support, our business is completely reliant on direct air connectivity to sustain our strategy. It allows our teams to effectively engage with and delight our customers and partners while servicing our projects worldwide.

“While the rise of digital connectivity has been beneficial, it cannot replace the value of in-person meetings and collaboration. Building strong relationships requires us to visit our customers, and our continued growth depends on aviation. Without this connectivity, we risk reverting to the detrimental impacts our business endured during the pandemic.“Market intelligence indicates that the international school’s market, with nearly 8,000 facilities globally, continues to grow at an exponential rate. Countries with the highest percentage of new international schools, and those poised for significant growth, include the UAE, China, Vietnam, Japan, India, the Americas, and Saudi Arabia. This underscores the importance for our island nation of innovators, experts, and exporters to have access to sustainable global links to an ever-increasing number of countries."

 Further quotes from a variety of business in different sectors and parts of the country are available below:

Subrahmaniam Krishnan-Harihara, Deputy Director - Research & Information Systems, at the Greater Manchester Chamber of Commerce, said:  "Aviation plays a pivotal role in driving economic growth, facilitating cultural exchange, and international collaboration for the Greater Manchester region and the United Kingdom as a whole.  Manchester Airport's direct air connections to destinations in the United States, East Asia and the Middle East are not merely travel routes; they are bridges that sustain and enhance our city region's prosperity by facilitating the seamless flow of goods and services, and enabling businesses in Greater Manchester to access international markets."In addition to aiding business travel, the aviation sector helps promote tourism, cultural and educational links. The Greater Manchester Local Industrial Strategy has laid out an ambition for our city region to be a global leader in sectors such as health innovation, advanced manufacturing and materials and digital and technology. Strong air connections to global hubs are essential to achieving this vision."Considering that the aviation industry is confident that it can reduce its environmental impact with continued innovation, a more sustainable future for the UK aviation sector is possible. It is essential for both regional and national economic prosperity that there is continued investment in airport capacity and in establishing new routes. A supportive policy and investment environment will send a strong signal that the UK and its regions remain open for business." 

Ben Mekie, CEO of The Acuity Method – a London-based firm that has created a tool to assess and develop global finance professionals, said:  "As we look to solidify our presence in key global markets like India, as well as expanding into the US, in-person contact will be key, even if initial conversations have taken place virtually."That means that having the best possible connections to our priority markets - now and in the future - will be critical to our success, and that of other businesses in our sector. Maintaining a strong aviation industry will be so important if we want businesses like ours to continue to flourish here in the UK." 

Henri Murison, Chief Executive of the Northern Powerhouse Partnership, said: “It is clear that capabilities including advanced manufacturing, digital, and life sciences rely heavily on global aviation connectivity. As the Northern Powerhouse Independent Economic Review set out a decade ago, the North of England already has considerable strengths in each of these highly productive sectors. “Maximising these strengths through improved international connectivity is key to boosting exports and raising productivity across the Northern economy, helping deliver growth across UK plc.”

 Prof Adam Beaumont, chair of Leeds-based tech firm AQL and Honorary Consul to the UK for Estonia, said: “Strong economic growth is underpinned by ensuring we have access to global expertise and talent. “Personal relationships are also critical, either for academic collaboration to reinforce the UK’s intellectual capital or to attract investment and foster entrepreneurial connections to leverage innovation and create wealth and prosperity. “The North needs strong international links and to build new routes with destinations which are successfully building strong entrepreneurial ecosystems, such as Estonia, among others.” 

Colin Sinclair, CEO of Knowledge Quarter Liverpool (KQ Liverpool) and Sciontec said: “If we want to truly rebalance the UK economy, then strengthening the North's global position by unlocking access to key markets is vital. "In the case of Liverpool, there is considerable momentum around the recently announced Liverpool City Region Life Sciences Investment Zone. Reinforcing this £800m opportunity, with the right support to enhance our connections with the world through Manchester and Liverpool Airports, will allow the North and wider UK to drive forward its strengths in the life sciences sector with positive spillover effects right across the North. “We would see increased inward investment as a result, as well as attracting the occupiers needed to create the high-value jobs and grow the economy.” 

Victoria Braddock, Managing Director at Marketing Manchester, said: “A strong and growing aviation sector is undoubtably important for UK plc to function and flourish, but at a regional level, it is crucial to any plans to meaningfully “level up” the economy. “It is a key area of focus within the Greater Manchester International Strategy, which outlines how the region will connect with and lead in bringing new trade, foreign direct investment, research and innovation, and international students to the region, as well as strengthening the international visitor economy through communication, connectivity, and political diplomacy.” 

Harriet Fear, Special Adviser, Cambridge& and Chair, Cambridge Ahead, said: “Cambridge& is the shop window for international organisations seeking to invest in Greater Cambridge – Europe’s largest innovation ecosystem. “So, I see firsthand how the companies scaling here, which offer so much promise for the UK economy and are so attractive to international investors, are dependent on air travel. Not least to secure capital, access global talent for their long-term pipeline and support deal flow. “Given my experience of working in the life sciences sector, it doesn’t surprise me at all that, according to WPI’s research, the sectors in the economy forecast to grow the quickest are those that are particularly dependent on international connectivity and access to global markets.” 

Simon Revell, Export Sales Manager at Suffolk-based Claydon Drills, said: “As an SME it is crucial for the continued growth of our business to be able to hold face to face meetings with current and future distributors and in particular the end users of our Opti-Till® crop establishment system.”