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The contribution of medical funding by charities to the Northern Ireland economy

Third sector medical research plays an important role both in the Northern Ireland economy and society.

Medical research makes huge contributions to society through developing new treatments, improving existing ones and advancing technologies that can help save lives such as vaccinations that can help fight against infectious diseases such as Covid-19.

Charities are major funders of medical research in Northern Ireland. Medical research funding by charities has been estimated to be 35% of all third sector and public funding of medical research, with active research funding of £9m in 2018.

Without charity funding, the public sector would therefore need to increase their direct funding1 of health-related research in Northern Ireland by an estimated 51% to cover the shortfall.

  • Furthermore, whilst the primary aims of medical research funding by charities are the benefits provided to health, the funding also makes a significant contribution to Northern Ireland’s economy: Recipients of research funding purchase goods and services in order to undertake their research. This generates activity in their supply chains and across the whole of Northern Ireland’s economy.
  • R&D can boost output and productivity in an economy with new technologies, medicines and processes.
  • As new methods and technologies are discovered, there are knowledge spill-overs into the public, private and third sectors which boost productivity and economic growth.

This report examines the first of these contributions and estimates the economic impact of medical research funding by charities on Northern Ireland’s economy in terms of jobs, output and Gross Value Added (GVA). This includes the direct impact of research on universities and medical organisations, as well as spill-over impacts on supply chains, job creation and wages.

Our results estimate that, in 2019, medical research funding by charities supported 500 jobs, £39m in output and £26m in GVA in Northern Ireland.

The pandemic had an impact on medical research funding by charities, placing jobs in research and the wider economy at risk. In 2020, the fall in medical research funding by charities put 50 jobs, and £3m output and £2m GVA at risk in Northern Ireland.

We also estimate multipliers for medical research funding by charities and compare these to 62 other sectors of Northern Ireland’s economy. Every £1 million spent on medical research funding in Northern Ireland by charities supports:

  • £2.44 million of output – 4th highest multiplier out of 63 sectors.
  • £1.63 million of GVA – 2nd highest multiplier out of 63 sectors.
  • 31 jobs – 7th highest multiplier out of 63 sectors.

Authors

James is a Fellow at the Fraser of Allander Institute. He specialises in applied analysis of trade and climate change. His work includes the production of economic statistics to improve our understanding of the economy, economic modelling and analysis to enhance the use of these statistics for policymaking, data visualisation to communicate results impactfully, and economic policy to understand how data can be used to drive decisions in Government.

Ben is an economist at the Fraser of Allander Institute working across a number of projects areas. He has a Masters in Economics from the University of Edinburgh, and a degree in Economics from the University of Strathclyde, as well as experience working on a variety of projects for public, private, and third sector organisations. He also focusses on business survey design and dissemination.

Adam is an economist at the FAI who works closely with FAI partners and specialises in business analysis. Adam's research typically involves an assessment of business strategies and policies on economic, societal and environmental impacts. Adam also co-leads on the FAI's quarterly economic commentary.

Find out more about Adam.

Part of Collection

This project provides analysis of the economic contribution of third sector medical research. The analysis covers the impact to the UK, Scottish and Northern Ireland economies. We also include an analysis of the share of the UK impact which is generated in Wales.