In the context of recent Government announcements about Cambridge and the continued national spotlight, this blog explores what the latest research from Cambridge Ahead, in partnership with the Centre for Business Research, tells us about how the Cambridge economy works and how its future growth could be facilitated to be sustainable and inclusive.
The Cambridge phenomenon has long been held up as an exceptional example of the power of clustering and agglomeration in modern economies, supporting a dynamic ecosystem which gives rise to new innovations and major growth potential, even in the context of a sometimes turbulent global economic backdrop.
Building on these strong foundations, Cambridge continues to be recognised for its world-leading innovation ecosystem, having contributed to 26 unicorn companies[i],[1] as well as seeing remarkable employment growth over the last 15 years, consistently outperforming national trends[2]. This growth has largely been driven by knowledge-intensive (KI) sectors.
Intensifying clusters and enabling infrastructure
The latest analysis from Cambridge Ahead’s commissioned research on Business Parks and Clusters indicates that this Cambridge phenomenon is deepening and broadening. Business parks and other clusters of employment are playing an increasingly important role in Cambridge’s growth. Clustering of businesses has intensified over the last decade with an increase in KI concentration on business parks and clusters over the last 6 years[3].
There are now over 150 identifiable clusters within a 20-mile radius of Cambridge city centre. This finding illustrates why Cambridge is the most intense science and technology cluster in Europe, and second in the world[4].
This builds on Cambridge’s reputation as one of the fastest growing innovation economies over the recent decades, and demonstrates that KI firms are drawn to proven environments for de-risking ambitious innovation strategies. This underlines the importance of these sites in the Cambridge ecosystem[5]. These science and innovation parks are now home to over 4,000 companies and 100,000 employees[6].
Transport improvements have been critical to supporting this growth; the data demonstrate that delivery of public transport infrastructure such as the Guided Busway, Cambridge North station, and A14 road improvements have supported employment growth in the business parks and clusters beyond the city centre[7]. This underlines the significance of enabling infrastructure and the opportunities that greater connectivity can present in supporting growth.
Key takeaway: Clusters and business parks, supported by transport infrastructure, are central to Cambridge’s ability to grow further and not “overheat.”.
Cambridge on the national stage and headwinds
With its strengths in academic research, translational opportunities and spin out culture, the latest data also highlight the continuing relative strengths of the Greater Cambridge economy – its fundamentals – and Cambridge’s strategic importance to the UK’s wider Growth Mission, in particular as a net contributor to the Exchequer[8] and as part of the OxCam Growth Corridor.
Cambridge continues to outperform national averages in employment growth[9], and its ecosystem is resilient, underpinned by research expertise, intellectual property creation, talent, and entrepreneurship. Strategic initiatives, from local growth plans to ongoing infrastructure upgrades, alongside investment announcements are laying the foundations for continued economic development.
Having said which, the most recently published data indicate that corporate employment growth slowed from 5.5% in 2022-23 to 0% in 2023-24, with KI sectors particularly impacted[10], demonstrating that the Greater Cambridge economy is not immune to national pressures or global trading shifts, and that UK competitiveness is keenly felt in places like Cambridge with internationally active firms.
Key takeaway: Cambridge’s innovation fundamentals are strong but not impervious to national context.
Investment in Cambridge and local leadership
In light of this, the Government’s recent announcements of investment in Cambridge’s future are both timely and welcome[11]. The £400m initial investment package to kickstart development in Cambridge funding is expected to support the Cambridge Growth Company and a future delivery vehicle with capital to remove barriers, unlock key sites, and accelerate housebuilding, presenting a major opportunity to realise good growth. As part of this, £15 million for the University of Cambridge Innovation Hub to support science startups to grow and compete on the global stage represents an important investment in Cambridge’s unique strengths and innovation ecosystem.
Alongside this, alignment across both national and local leaders that growth must be inclusive and sustainable is critically important. There is a broadly shared consensus across academic, business and civic leadership that our local communities must be beneficiaries of Cambridge’s future growth. This shared commitment provides a strong basis to ensure that the next chapter of Cambridge’s history is an opportunity to reduce inequalities, enhance our environment, and take a truly ambitious approach to inclusive growth which benefits local people and delivers widespread long-term prosperity.
The latest research points towards a clear template for the next phase of Cambridge’s growth. To sustain and strengthen this ecosystem, Greater Cambridge will need to create space for clusters and parks to grow and intensify, while ensuring they remain well connected to each other – to facilitate agglomeration on a city region scale – and to the locations where the future workforce will live. Prioritising connectivity and enabling infrastructure is vital to support employment growth concentration and potential positive spillover, delivering on the Government’s ambition for Cambridge.
Key takeaway: Timely investment and aligned leadership create the conditions for Cambridge to achieve sustainable, inclusive good growth.
Greater Cambridge Draft Local Plan – encouraging signs
The Greater Cambridge Draft Joint Local Plan[12] encouragingly reflects many of these principles: proposed Green Belt releases at the Cambridge Biomedical Campus and Babraham Research Campus which would support further intensification of key clusters; new housing settlements at locations such as Grange Farm, close to existing KI clusters; and planned growth in places that will be well-connected, such as Cambourne, where East West Rail, the Cambourne-to-Cambridge busway, and other transport improvements are expected to increase and significantly increase connectivity.
Cambridge Ahead will respond to the draft Local Plan consultation once our members have had the opportunity to review and reflect on the proposals in detail. As always, our response will be grounded in evidence and shaped by the collective insights of our diverse membership.
We will also continue to work closely with Cambridge Growth Company, our local authority partners, and with the Cambridgeshire & Peterborough Combined Authority as they develop the new Strategic Development Strategy. Our focus will remain on ensuring that the underlying principles of good growth – employment-led, infrastructure-first, with high quality social infrastructure which ensures better quality of life for all – are embedded into emerging plans.
Key takeaway: The Draft Local Plan and future development strategies present an opportunity to align with Cambridge Ahead’s vision for sustainable, inclusive, and employment-led growth.
[i] Unicorn companies refers to businesses that have achieved a $1 billion valuation
[1] University of Cambridge. (2025). Cambridge innovation in numbers. Available at: https://www.cam.ac.uk/stories/innovation-in-numbers-2025.
[2] Cambridge Ahead and Centre for Business Research. (2025). Business parks and clusters. Available at: https://cambridgeahead.co.uk/wp-content/uploads/2025/10/Business-Growth-and-Clusters-Cambridge-City-Region-2015-2024.pdf
[3] Cambridge Ahead and Centre for Business Research. (2025). Business parks and clusters. Available at: https://cambridgeahead.co.uk/wp-content/uploads/2025/10/Business-Growth-and-Clusters-Cambridge-City-Region-2015-2024.pdf
[4] Page 89; World Intellectual Property Organization. (2025). Global Innovation Index 2025. Available online: https://www.wipo.int/web-publications/global-innovation-index-2025/assets/80937/global-innovation-index-2025-en.pdf
[5] Cambridge Ahead and Centre for Business Research. (2025). Business parks and clusters. Available at: https://cambridgeahead.co.uk/wp-content/uploads/2025/10/Business-Growth-and-Clusters-Cambridge-City-Region-2015-2024.pdf
[6] Cambridge Ahead and Centre for Business Research. (2025). Business parks and clusters. Available at: https://cambridgeahead.co.uk/wp-content/uploads/2025/10/Business-Growth-and-Clusters-Cambridge-City-Region-2015-2024.pdf
[7] Cambridge Ahead and Centre for Business Research. (2025). Business parks and clusters. Available at: https://cambridgeahead.co.uk/wp-content/uploads/2025/10/Business-Growth-and-Clusters-Cambridge-City-Region-2015-2024.pdf
[8] Greater Manchester Combined Authority. (2019). ESPRESSO – Tax and Expenditure Tool. Available at: https://www.greatermanchester-ca.gov.uk/what-we-do/research/research-investment/espresso-tax-and-expenditure-tool/
[9] Centre for Business Research and Cambridge Ahead. (2025). Business parks and clusters. Available at: https://cambridgeahead.co.uk/wp-content/uploads/2025/10/Business-Growth-and-Clusters-Cambridge-City-Region-2015-2024.pdf
[10] Centre for Business Research. (2025). Greater Cambridge Employment Update June 2025. Available at: https://www.greatercambridge.org.uk/asset-library/Future-Investment/Research-and-Evidence/Employment-update-June-2025.pdf
[11] HM Treasury. (2025). Jobs, homes and better transport links for the Oxford Cambridge Growth Corridor. Available at: https://www.gov.uk/government/news/jobs-homes-and-better-transport-links-for-the-oxford-cambridge-growth-corridor
[12] Greater Cambridge Shared Planning. (2025). Draft Greater Cambridge Local Plan. Available at: https://consultations.greatercambridgeplanning.org/draft-greater-cambridge-local-plan-consultation/document-library
Have your say
Cambridge Growth Company is now picking up the baton, working with the Centre for Business Research. They need to hear directly from those working in the Cambridge City Region to identify priorities for investment and future development.
