(Bloomberg) -- Britain is lagging behind its major European peers when it comes to spending on research and development, a fact that may help to explain its dismal productivity performance.
Despite R&D spending reaching a record 33.1 billion pounds ($46 billion) in 2016, the U.K. was ranked 11th in the European Union, according to a report published by the Office for National Statistics Thursday. It found Britain invested 1.67 percent of its gross domestic product, below the EU average of 2.03 percent and about half the level seen in Sweden.
While Bank of England Governor Mark Carney has hinted that productivity growth may accelerate, policy makers have long expressed concern about its persistent sluggishness.
Prime Minister Theresa May last year pledged a decade-long push to increase R&D spending in an effort to bring it into line with other rich nations.
Economic growth is being constrained by poor productivity, and the government's budget watchdog said this week it expects medium-term growth in output per hour to be slightly weaker than previously forecast as it downplayed a pickup toward the end of last year.
To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net.
To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Andrew Atkinson
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