Firms that begin to export boost their business productivity by up to a third in the first year. This is one of the key findings of new research published by UK Trade & Investment (UKTI), the Government's trade and investment development organisation.

The paper confirms that in general in the UK, exporting firms are more productive than non-exporters, and are more likely to stay in business. The report suggests that this is likely to reflect improvements made by companies preparing to export. It also shows that some 60% of UK productivity growth during the period 1996-2004 was attributable to exporting firms.

Trade and investment Minister Ian McCartney said: "Globalisation presents challenges and opportunities for business. It is clear that working in global markets gives companies an opportunity to up their game. This research demonstrates that work involved in committing to export and entering the international market place is rewarded in increased productivity, stronger business performance, and more secure jobs."

The report, "Firm Level Empirical Study of the Contribution of Exporting to UK Productivity Growth" by Richard Harris and Q Cher Li, of the University of Glasgow, was commissioned by UKTI. It is based on a larger and more representative dataset than had been analysed in previous studies, and covers both services and manufacturing.

Among its main findings are:
* Firms that are new to exporting on average experience a 34% increase in productivity in the year of entry.
* Firms that stop exporting experience a drop in productivity (of around 7-8% for all the sectors covered).
* Over the period 1996-2004 some 60% of UK productivity growth was attributable to exporting firms, including both established and new exporters.
* The majority of firms engaged in exporting at some time between 1997-2003 had a statistically significant lower probability of closure. Firms were 11.4% more likely to survive if they exported.
* Foreign owned companies operating in the UK also enjoy higher levels of productivity and foreign owned subsidiaries were almost 12% less likely to close, than UK owned firms.

The study is a substantial new contribution to the evidence base on the role exporters make to the UK economy and help to inform development of UKTI's services to business.