How the Thames Valley and Solent regions align with the government’s industrial strategy (IS-8)

The government’s 2025 industrial strategy (IS-8) sets out a clear ambition to drive productivity, innovation, and globally competitive growth across eight priority sectors. The Thames Valley and Solent, spanning Berkshire, Oxfordshire and Hampshire, is already delivering strongly against these goals, underpinned by an innovation-led, IP-rich, and service-focused economy.

With more than 47,000 active businesses operating in IS-8 sectors, generating around £258bn in turnover and employing over 780,000 people, the region’s economic profile closely mirrors the intent of the strategy. Its strength lies not in traditional heavy industry, but in entrepreneurial SMEs, fast-growing scale-ups and globally connected firms built around knowledge, technology and expertise.

Digital & technology: the region’s engine for growth

Digital and technology is the regions most significant IS-8 sector. Over 18,600 tech businesses operate across the region, generating approximately £139bn in turnover and employing more than 360,000 people. Berkshire in particular has established itself as a national technology corridor, with strong levels of new company formation and sustained entrepreneurial activity.

This sector aligns directly with IS-8 priorities such as artificial intelligence, software, cyber security and digital infrastructure. High revenue per employee, scalable business models and strong IP creation position the Thames Valley as a major contributor to national productivity and innovation.

Life sciences: research strength with commercial reach

Life sciences are especially concentrated in Oxfordshire, with more than 1,000 businesses generating over £40bn in turnover. The sector is characterised by deep R&D capability, longer development cycles and significant capital investment.

Importantly, the region benefits from increasing crossover between life sciences and digital technology, particularly in areas such as digital health, diagnostics and data-driven research, supporting IS-8 ambitions around research excellence, global competitiveness and commercialisation.

Professional & business services: enabling the IS-8 ecosystem

Professional and business services are one of the most widespread sectors by company numbers, particularly in Berkshire. While sometimes overlooked in industrial strategies, they play a critical enabling role, supporting investment, governance, compliance, exports and scaling across all IS-8 priority sectors.

Their breadth and resilience help underpin the regions ability to convert innovation into sustainable, high-value growth.

Strategic fit with the industrial strategy

Overall, the region is already achieving many of the ambitions set out in the IS-8 Industrial Strategy. The region demonstrates high productivity, strong innovation, global connectivity and resilient economic performance, driven less by traditional manufacturing and more by IP-led services, digital skills and specialist expertise that supports every sector.

The main barriers to even greater impact are not sector-specific. Instead, they relate to broader challenges such as infrastructure capacity, planning constraints, housing availability and access to skilled talent. Addressing these issues would unlock further productivity gains and enable the region to make an even stronger contribution to national IS-8 objectives.

Conclusion

The regions sits firmly within the government’s IS-8 framework, not playing catch-up, but as one already embodying the strategy’s core ambitions. Its real strength lies in its depth of innovation-led sectors, its thriving SME and scale-up community, and its ability to translate research, digital capability and professional expertise into high-value economic outcomes.

With the right support to ease infrastructure and talent constraints, the Thames Valley and Solent regions are well positioned to remain a pillar of the UK’s industrial future, and a model for innovation-led growth across other regions.

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