2022 report: The UK tech ecosystem in review
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Tech City UK, the UK government backed organisation tasked with accelerating the growth of digital businesses, and innovation charity Nesta, today launch the Tech Nation 2016 report in partnership with core data partner, GrowthIntel. The most comprehensive analysis of the UK’s digital tech industries to date, Tech Nation 2016 underlines the role digital tech businesses are playing in boosting economies across the North of England.
The report, which is supported by Tech North, found the digital tech economy has a strong impact on employment throughout the North of England, with 283,515 people employed in the sector.
Tech Nation 2016 provides an unprecedented insight into the phenomenon of digital clusters – concentrations of digital tech entrepreneurs – and their role in fuelling the growth of the digital tech industry across the country.
In particular, Tech Nation 2016 highlights that digital tech businesses are flourishing in clusters across the North of England:
Hull’s current strengths include App & Software Development, E-Commerce & Data Management & Analytics. The strong digital infrastructure has produced a business growth rate of 24% (2010-2014) and a rise of 14% in GVA (2010-2014). Hull’s ecosystem is supported by local organisations including C4Di and Hull Digital.
With a wealth of graduates from the city’s numerous universities and education institutions, Leeds has a talent pool almost unrivalled in the UK. The cluster experienced the highest advertised digital salary growth in the UK at 29% (2012-2015) recorded an average turnover growth rate of 47% (2010-2014). Today, its specialisms include Digital Marketing & Advertising, E-Commerce and App & Software Development. Leeds’ support organisations include Google Digital Garage.
Digital tech businesses in Liverpool recorded an average GVA growth rate of 52%. Co-working spaces are credited with helping the cluster’s growth, with Liverpool’s commercial and residential property rents among the lowest in the UK. The cluster’s digital tech economy employs over 19,500 and has a digital density of 17%. Liverpool’s key sectors include Gaming, IoT & Connected Devices, App & Software Development and E-Commerce & Marketplace. The digital tech community in Liverpool is supported by Liverpool Vision and Baltic Creative amongst others.
Manchester has established itself as one of the top five clusters in the UK, with the second highest GVA growth (92%, 2010-2014) and digital employment of 51,901. The cluster’s specialisms include Edtech, E-commerce and Adtech, with a long-established specialism in digital entertainment. Manchester features support organisations including Spaceport X and Manchester Digital.
Newcastle & Durham generated the second highest advertised digital salary growth of any cluster in the UK at 26.6%. It has a turnover growth rate of 29% and GVA growth rate of 35%. Digital tech businesses in the cluster are more likely than any other to receive support from an accelerator, and the second most likely to receive mentoring support. Dynamo North East, Campus North and Ignite 100 are amongst the organisations providing support to the digital tech ecosystem.
The cluster’s strengths are built on expertise in App Software & Development, and Enterprise Software and Cloud Computing, with recently established specialisms in Hardware, IoT and E-Commerce. Digital tech businesses in Sheffield & Rotherham recorded an average turnover growth rate of 45% (2010-2014). Dotforge and Electric Works provide strong support to digital tech companies in the area.
The cluster has enjoyed steady growth, with employment rising by almost 17% since 2010. In addition to a long-standing specialism in App & Software Development, it has a growing expertise in Hardware, Gaming and Telecommunications. Businesses within the cluster recorded an average 44% growth in turnover (2010-2014) and 29% growth in GVA (2010-2014). Support organisations include Sunderland Software City.
The Tech Nation 2016 report is produced jointly with Nesta, who led on the data collection and analysis as well as initial drafting of the report. The report was also supported by core data partner GrowthIntel. Contributing data partners include AngelList, Burning Glass, Crunchbase, dealroom.co, Frontier Economics, Github, InvestNI, Leeds Data City, and Meetup.
With more than 2,000 respondents from digital businesses across the country also contributing insights, the latest iteration of Tech Nation showcases the continued growth and evolution of the UK’s digital tech economy.
Herb Kim, Executive Chair of Tech North, comments: “Tech Nation 2016 provides an unprecedented insight into the growing economic importance of the North’s digital businesses.
“This report not only demonstrates the extraordinary growth rate of our digital tech industry, but also its profound influence on non-digital industries.
“We hope Tech Nation’s findings will prove invaluable to industry, investors and digital businesses themselves, acting as a detailed topography of the UK’s digital economy and signposting where future opportunities lie.”
Geoff Mulgan, CEO of Nesta, comments: “Digital technologies are unlike any others – they change everything businesses do. That’s why, as this research confirms, digital jobs and activity are becoming ever more important in apparently non-digital industries.”
“And it’s why the pay premium is so high, at an average of over £15,000 for digital over non-digital jobs. I hope that parents and teenagers will get the message – that acquiring digital skills pays off, wherever you are.”
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