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How science and technology can drive Australia’s COVID recovery

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As challenges go, few come bigger than this. 

To rebuild the nation’s economy after the COVID pandemic will be a vast enterprise. Every business leader and entrepreneur has a role in this work.  

The wrecking ball of the COVID pandemic destroyed hundreds of thousands of Australian jobs in the space of a few short – and yet oh so long – months. 

Now the race has begun to create new jobs to avert a deep and prolonged recession.

Worse may be still to come for some trade-exposed sectors, with international trade and travel unlikely to be able to resume on any significant scale for some time. 

As a result, Australia will need to look to our own resourcefulness to drive our economic recovery.

The good news on that front is that Australian ingenuity is a powerful and proven force.

And our capabilities in science, technology, engineering and maths – the STEM expertise that will drive much of the next global boom in prosperity – are going to be pivotal.

From the brilliance of Indigenous innovation in the deep knowledge systems of this country, to the newest of our high-tech startups, we have strong foundations on which to build.

As the CEO of the nation’s peak body for the science and technology sectors, I see this in action every day.

Clever high-tech startups like Speedx have seized new opportunities amid the pandemic. They grew out of Cicada Innovations, the innovation incubator in Sydney, and pivoted swiftly to develop a new rapid COVID test alongside its other diagnostic tools to detect viral and bacterial infections and antibiotic resistance markers.  

We have also seen Governments embrace scientific expertise strongly to guide public health policies across the country. That early decision to act on evidence and expertise has been the makings of our success to contain the spread of the virus. And it’s been a source of confidence and reassurance to Australians.

If there is a lesson to be learned about how the public has responded to Governments relying on scientific expertise in our COVID response, it’s that we should carry that model forward into the task of reconstruction. Science and technology should drive our economic recovery.

That’s why our sector wants to see Australia swiftly build up its translational research capability.

As we see it, our country has a gap in funding for projects at the ‘almost there’ stage of the research pipeline.

One way to fill this gap would be to establish a new Research Translation Fund.

This funding body would help to quickly propel new products and techniques to market.

It could deliver the boost we need to drive faster uptake of digital opportunities for Australia’s traditional industry sectors in everything from agriculture to mining.

And it could also be the vehicle to fund clever science and tech enabled products and services that our nation can turn into new businesses, new jobs, and whole new sectors of our economy.

As just one example, think about the next bushfire season.

We could see a translational research fund play a role to gather information from frontline fire fighters – and quickly test enhancements to protective equipment to meet dangerous new conditions. Or it could fund a rapid advance in using satellite technology to locate new spot fires – and direct crews to them before they grow and join other major firefronts. 

Fighting bushfires is just one example of thousands. In every industry sector, there will be examples of the need for translational research projects – where either a business or a researcher come up with a clever idea, and just need a rapid funding boost to test and deploy it into market.

At the outset of this pandemic, Australia – like much of the world – was scrabbling to secure everything from N95 masks to ventilators.

As we start the serious work of recovery, STA backs Industry Minister Karen Andrews’ call for greater sovereign capability in our manufacturing sector.

We see this capability extending well beyond medical equipment. 

Every business in the country has looked closely on its own operations during this period to assess what more can be done to minimise supply chain risks.

It has prompted deep reflection on how to secure supply chains within Australia to create greater security in future.

And even before COVID, it was clear we had a gap in next-generation manufacturing hubs to support startups and smaller businesses. For the hundreds of MedTech startups, for example, there was no ISO rated prototyping facility in Victoria or NSW. 

We also need greater engagement between the Industry Growth Centres with start-ups and peak bodies – including in technology-enabled advanced manufacturing.

And the skilled workforce to help quickly build sovereign capability and recharge Australian business in general is sitting in plain sight – in the form of postgraduate science students.

Entry level research jobs have been hit hard in the COVID-19 lock-down. 

That’s why STA has proposed a one-off boost in the budget to keep postgraduate students in the research system.

These researchers deliver strong value for money. They earn stipends of just $28,000 a year to keep labs and fieldwork running on major research that could help spawn new industries and innovations.

There is a short-term and long-term incentive for Australia to hold onto their talent.

STEM related jobs for women have been particularly hard hit in the pandemic, and this threatens to undo years of work to make inroads to tackle women’s under-representation in the sector.

Another measure that would help the nation’s reconstruction efforts would be to add a new ‘collaboration premium’ to the Research & Development Tax Incentive.

This would give firms that partner with Australian research institutes, universities or government agencies an extra 20 per cent boost to the tax break they can claim for R&D.

And it could also be applied to cover the wages of graduates with a science, technology, engineering or maths PhD for a couple of years, as recommended by a major review of the scheme in 2016.

Why is this important?

Because evidence shows that when businesses tap into the expertise of universities, there are benefits to both their bottom line and to our national economy.

On average, businesses that collaborate with universities see a return on investment of almost $4.50 for every dollar they invest.

A collaboration premium would also encourage businesses to invest more in R&D here in Australia.

Australian Bureau of Statistics figures suggest the amount of R&D money that Australia’s business sector spent overseas actually rose by half a billion dollars – $534 million – in 2017-18.

If we can keep more of those dollars onshore, with the right incentives, we’ll keep the capital here to fund more new job creation at home.

That’s the kind of thinking the United Kingdom has adopted to put R&D at the heart of its industrial strategy.

The UK will boost public funding in R&D by 15% in the next fiscal year – its largest year-on-year increase ever.  And Prime Minister Boris Johnson’s Government plans to ramp up R&D spending even faster over the next 3 years, more than doubling the current total to £22 billion by 2024–25.

With pre-emptive and targeted investment in our STEM sector now, Australia can design a clever economy recovery strategy from COVID-19 that plays to our STEM strengths and seizes new opportunities.

So that when we are able to reopen our borders again to the world, we’ll have more innovative Australian startups and spinoff companies. Businesses created from science and technology expertise, to generate income for our nation.

And we’ll have created more higher-wage local jobs for the next generations of young people who currently face an incredibly challenging job market.

We owe it to them – and to the nation – to seize these opportunities.

Misha Schubert is CEO of Science & Technology Australia, the peak body for the science and technology sectors, www.sta.org.au.

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