Considering investors ploughed a record £2.5bn into UK tech firms last year, it’s probably not surprising to hear digital industries grew 32% faster than the rest of the economy from 2010 to 2014. Or even that an average advertised salary in a digital tech job is £50,000 – 36% higher than the national average.
What is perhaps a little more eye-catching is that 41% of digital tech jobs exist within traditionally non-digital industries, according to Tech Nation 2016, a new report by government-backed Tech City UK and innovation charity Nesta.
‘In that sense it’s quite resilient,’ Gerard Grech, CEO of Tech City UK, tells MT. ‘The tech industry is having a transformative effect on traditional industries like transportation, like the public sector, and they’re contributing job growth, job creation and economic wealth for the country.’
Much of the report tells us what we already knew – or at least heavily suspected. The digital tech economy is having a significant impact on employment nationwide (to no one’s surprise) – accounting for 1.56m jobs, having grown 11.2% between 2011 and 2014. That's nearly three times faster than job growth for the rest of the workforce. Productivity in tech is also outperforming the rest. Employees were estimated to be 90% more productive than workers in the economy overall, based on gross value added per worker.
Aside from blowing tech's trumpet, the report is also evidently keen to refute the idea that the sector is far too London-centric. ‘The growth we’re seeing is impacting cities right across the UK, which is very good for local economies,’ Grech says. ‘I think 80% of cities have seen growth in employment and in economic growth.’
The Tech Nation 2016 report cited examples such as fintech and big analytics in Edinburgh, cyber security in Belfast, AI in Oxford and the internet of things in Bristol, while PM David Cameron added that, ‘more than half of all digital jobs now aren’t in high-tech hubs of London or Leeds – they are in businesses of every description, in every sector’.
But among all this growth, buckets of investment and glowing prospects, there has still been concern about the prospect of a bubble as the industry continues to gain altitude. Grech thinks there are a couple of other significant challenges on the near horizon for digital businesses – the burden of growing expectations and the ongoing struggle for talent. Finding the right people to fill all these highly-skilled positions is difficult, ‘not least because the industry is so fast-moving and they need to have an increasing number of skilled people in this sector’.
Prioritising the growth and sustainability of an expanding sector (that we actually seem to be good at) should clearly be an ongoing concern for the government – and that includes improving its visa schemes. Of course, it is possible to get carried away, especially after reading reports like this one ('one in three digital tech businesses source talent from local universities! A fifth stress the importance of sourcing talent from EU countries as welll as the UK!'). There are plenty of jobs, after all, that aren't digital tech jobs (about 30 million of them) that shouldn't be forgotten in the quest to replicate Silicon Valley on these shores. Balance, as ever, is required.