The NCUB said that data from the Higher Education Business Community and Interaction survey run by UK Research and Innovation (UKRI) showed that between August 2022 and the end of July 2023 there was a 5% decline in university-business interactions to 76,619.

Universities generated £5.7bn in income from knowledge exchange activity, according to the data, which was a 0.02% decline in cash terms and 6.1% decline in real terms from the previous year.

Rosalind Gill, head of policy and engagement at the NCUB, said that the data was “a stark warning that financial pressures are straining university knowledge exchange and collaboration with industry”.

Gill continued: “Falls in university-business interaction are likely linked to a range of factors including the significant financial pressures facing universities, as well as the loss of vital EU Regional Development Funding (ERDF).

“ERDF played a critical role in supporting some forms of collaboration but has not been adequately replaced.”

NCUB added, however, that 1,571 spin-out companies from universities had survived at least three years, up by 9%, and there were 165 newly registered spinouts.

Gill concluded: “Despite the declines observed in 2022-23, university-business collaboration remains a major competitive strength of the UK. The new data highlights UK university strengths in generating spinouts, with the number of university spinout companies surviving longer than three years growing by 9%.

“There is a crucial window for the government to act now to return university-business collaboration to a trajectory of growth. This requires putting university funding on a more sustainable footing and supporting collaboration with businesses of all sizes.”