Innovation districts offer outsized benefits – NSW Government report

According to a new report from the NSW Innovation and Productivity Council, successful innovation zones deliver disproportionate economic and productivity benefits to government, business, investors and workers.

The report, NSW Innovation Precincts: Lessons from International Experience, identifies the economic benefits of Innovation Zones, including above-average productivity, greater resilience to economic downturns and better leverage of public investment in key assets .

Often forming around major public sector facilities such as Sydney’s Westmead Hospital or the Australian Nuclear Science and Technology Organization’s Lucas Heights facility, research and industry concentrations can also offer higher salaries. higher prices and quality jobs for workers, higher quality products for consumers and higher tax revenues for the government. .

“The clustering of industries in constituencies facilitates collaboration, knowledge flows and knowledge spillovers between industry, researchers and entrepreneurs, which plays a vital role in increasing levels of innovation, especially for new businesses.

The report, released by NSW Minister for Enterprise, Investment and Trade, Alister Henskens, said the proximity of innovative companies to each other, institutions and investors, as well as co-location with incubators, accelerators and anchor tenants have improved collaboration.

New South Wales has a number of innovation hubs, including in sectors such as healthcare, scientific instruments, finance and business services, biopharma, defence, software and communications, l ‘agtech, engineering and creative industries.

A major new district, Sydney’s Tech Central is positioned as Australia’s answer to Silicon Valley and is centered on new facilities for tech giant Atlassian, while districts are also planned for the new Western Sydney Airport.

In addition to location-based benefits, innovation districts, according to the report, also need:

  • Market drivers stemming from high demand for goods and services produced
  • Clearly defined competitive advantage or industry specialization as well as brand strategy to attract talent
  • Facilities and programs to support collaboration between various organizations
  • Physical, transport and digital infrastructure to support research, innovation and connectivity
  • And strong governance. strong leadership and a shared vision.

Constituencies also need to be vibrant places to attract staff and a strong entrepreneurial and risk-taking culture.

However, the report also indicates that the complex combination of stakeholders, economic drivers and local factors necessary for the success of innovation zones makes them particularly vulnerable to market failures that hinder innovation in general.

“The tendency of companies to underinvest in innovation, information gaps between investors and startups, or between companies and knowledge institutions, and governance and coordination failures within and between parties Stakeholders in the innovation ecosystem can all prevent an enclosure from reaching its potential.

“This report encourages better coordination among stakeholders.

Image: NSW Investment

Melvin B. Baillie