85,000 more digital tech jobs in UK compared to 2 years ago, growing from 1.56 million to 1.64 million
85,000 more digital tech jobs in UK compared to 2 years ago, growing from 1.56 million to 1.64 million
The growth rate of digital jobs was more than double that of non-digital jobs between 2011 and 2015. Furthermore, these jobs are highly skilled and highly paid, contributing to the productivity and growth of the wider economy.
| Year | Number of Digital Tech Jobs (Millions) |
| 2014 | 1.56mm |
| 2015 | 1.64mm |
Source: BSD, Tech City UK, 2015
In 2015, the turnover of UK digital tech was estimated at £170 billion, a growth rate of 22% (£30 billion) in just five years
| YEAR | GROWTH IN TURNOVER (DIGITAL) | |
| 2011 | 139 | |
| 2012 | 150 | |
| 2013 | 157 | |
| 2014 | 161 | |
| 2015 | 170 |
Source: BSD, Tech City UK, 2015
| YEAR | GROWTH IN TURNOVER DIGITAL BUSINESSES | GROWTH IN TURNOVER NON-DIGITAL BUSINESSES |
| 2011 | 4.4% | 1% |
| 2012 | 8% | 5% |
| 2013 | 4.6% | 4% |
| 2014 | 3% | 5% |
| 2015 | 5% | 3% |
Source: BSD, Tech City UK, 2015
In 2015, the GVA (Economic Contribution) of the digital tech sector reached £97 billion, with a growth rate of 30%
| YEAR | GROWTH IN GVA (DIGITAL) | GROWTH IN GVA (NON-DIGITAL) |
| 2011 | 10.1% | 2.3% |
| 2012 | 2.6% | 2.58% |
| 2013 | 5.86% | 5.16% |
| 2014 | 9.4% | 10% |
| 2015 | 9.38% | 3.6% |
Source: BSD, Tech City UK, 2015
| YEAR | GROWTH IN GVA (DIGITAL) | |
| 2011 | 74 | |
| 2012 | 76 | |
| 2013 | 81 | |
| 2014 | 89 | |
| 2015 | 97 |
Source: BSD, Tech City UK, 2015
UK tech businesses are growing 2X faster than non digital businesses
Over a five-year period, the total number of UK digital tech businesses grew by 28%. That is more than twice as fast as the growth in non-digital businesses (up 13%). In 2015 alone, the number of UK digital tech businesses grew by 7%, compared with just 4% in the non-digital sector.
These new businesses are creating jobs, generating wealth and supporting the wider economy. Moreover, by stimulating new technologies, innovations and efficiencies in other sectors, they boost productivity across the board too.
| YEAR | GROWTH IN NUMBER OF DIGITAL BUSINESSES | GROWTH IN NUMBER OF NON-DIGITAL BUSINESSES |
| 2011 | 100% | 100% |
| 2012 | 103% | 101% |
| 2013 | 112% | 105% |
| 2014 | 119% | 109% |
| 2015 | 128% | 113% |
Source: BSD, Tech City UK, 2015
London, Belfast and Edinburgh see fastest growth rates for number of new digital tech businesses
In terms of sheer number of new digital tech businesses emerging London has seen the strongest growth, up by 42% in five years.
Belfast, Edinburgh and Newcastle have seen almost as impressive growth figures over this period, at 37% and 34% respectively.
What’s more, in 13 of our 30 clusters the quantity of digital tech businesses has increased by more than a quarter.
| City | Business Growth (2011-2015) |
| London | 42% |
| Belfast | 37% |
| Edinburgh | 34% |
| Newcastle | 34% |
| Birmingham | 33% |
| Glasgow | 33% |
| Nottingham | 31% |
| Brighton | 29% |
| Leeds | 29% |
| Liverpool | 29% |
| Cardiff & Swansea | 28% |
| Plymouth | 28% |
| Sheffield | 27% |
| Leicester | 24% |
| Bristol & Bath | 23% |
| Manchester | 23% |
| Hull | 21% |
| Reading | 21% |
| Truro & Redruth | 21% |
| Cambridge | 20% |
| Exeter | 18% |
| Norwich | 18% |
| Southampton | 18% |
| Sunderland | 18% |
| Oxford | 17% |
| Bournemouth & Poole | 16% |
| Dundee | 16% |
| Middlesbrough | 14% |
| Worcester & Malvern | 11% |
| Ipswich | 2% |
Source: BSD, Tech City UK, 2015
Digital tech businesses created twice as fast as non-digital, In London, a new tech business is born every hour, at 8,472 in 2015
In 2015, the birth rate of digital tech businesses across the UK was 15%. By comparison, the business birth rate across the wider economy was just over 11.5%.
Business birth rates – a measurement of new companies as a proportion of all businesses in an area – can tell us a lot about the vitality of an economy.
Business formation, of course, is influenced by the economic climate. Business birth rates, however, are also likely to be higher in places where the potential for profit is high and the right resources – not least talent and infrastructure – are in place.
So the outlook is strong at the national level, but how does it break down regionally? In the same year, all but four of our 30 clusters had a digital tech birth rate that exceeded the average in non-digital sectors. An impressive one in three had digital tech birth rates of over 15%: Sunderland 19.3%, London 18.7%, Glasgow 18.3%, Newcastle 17.5%, Edinburgh 17.2%, Liverpool 16.8%, Leeds 15.9%, Manchester 15.6%, Birmingham 15.3% and Middlesbrough 15.1%.
| City | BIRTH RATE (2011-2015) |
| Sunderland | 19.3% |
| London | 18.7% |
| Glasgow | 18.3% |
| Newcastle | 17.5% |
| Edinburgh | 17.2% |
| Liverpool | 16.8% |
| Leeds | 15.9% |
| Manchester | 15.6% |
| Birmingham | 15.3% |
| Middlesbrough | 15.1% |
| Nottingham | 14.6% |
| Reading | 14.6% |
| Cardiff & Swansea | 14.6% |
| Belfast | 14.3% |
| Leicester | 14.1% |
| Sheffield | 13.4% |
| Hull | 13.1% |
| Southampton | 12.4% |
| Bournemouth & Poole | 12.2% |
| Norwich | 12.2% |
| Bristol & Bath | 12.2% |
| Cambridge | 12.1% |
| Exeter | 12.1% |
| Oxford | 12% |
| Brighton | 11.8% |
| Redruth & Truro | 11.6% |
| Dundee | 11.5% |
| Ipswich | 11.4% |
| Plymouth | 11.4% |
| Worcester & Malvern | 8.9% |
Source: BSD, Tech City UK, 2015
High growth companies are nearly twice as prevalent in the digital tech sector compared to non digital tech
| TTWA name | PERCENTAGE OF HIGH GROWTH FIRMS (BY TURNOVER, 2014) |
| Bournemouth & Poole | 26% |
| Newcastle | 22% |
| London | 20% |
| Glasgow | 19% |
| Brighton | 19% |
| Oxford | 18% |
| Reading | 18% |
| Belfast | 18% |
| Bristol & Bath | 17% |
| Manchester | 17% |
| Edinburgh | 17% |
| Leeds | 16% |
| Cambridge | 15% |
| Nottingham | 15% |
| Leicester | 12% |
| Birmingham | 11% |
| Sheffield | 11% |
| Southampton | 10% |
Source: BSD, Tech City UK, 2015
17% of all UK digital tech businesses with ten or more employees were high-growth. In the non-digital sector, just 9.8% of businesses of the same size could claim the same status.
High-growth businesses are defined as businesses whose growth in annual turnover places them in the top 10% nationally. They span all sectors of the economy.
So, more high-growth firms are to be found in the digital tech sector. This matters, because businesses like these play a major role in the UK’s economic growth. Not least because they are more productive than average and tend to create high quality, well-paying jobs. Our analysis revealed Bournemouth & Poole, Newcastle and London to be home to the highest concentrations of high-growth digital tech businesses.
Reading has the highest concentration of digital tech businesses followed by Bristol and Cambridge
Two clusters emerge with exceptional digital tech concentrations – Reading and Bristol & Bath.Interestingly, London’s LQ is below one. Despite being the largest digital tech hub in Europe by some margin, the sheer size and diversity of its economy dilutes its digital tech concentration.
The geographic concentration of digital tech businesses is telling. Similar businesses tend to group together, pooling resources and requirements. But why does this matter?
Broadly speaking a high concentration of digital tech businesses is good for a local economy, since it is associated with highly skilled and higher paid employment and higher levels of GVA. This concentration is called Location Quotient (LQ) and is a measure of digital density, relative to the UK overall. The higher a cluster’s LQ, the greater the concentration of digital tech businesses. In the chart, a value of one equals average digital concentration, while a value of greater than one implies a higher concentration.
| City | Digital Density (Turnover) |
| Reading | 7.26 |
| Bristol & Bath | 4.35 |
| Cambridge | 1.79 |
| Southampton | 1.57 |
| Oxford | 1.53 |
| Brighton | 0.92 |
| Hull | 0.92 |
| London | 0.86 |
| Birmingham | 0.78 |
| Nottingham | 0.77 |
| Worcester & Malvern | 0.69 |
| Newcastle | 0.69 |
| Dundee | 0.69 |
| Manchester | 0.63 |
| Glasgow | 0.54 |
| Belfast | 0.49 |
| Exeter | 0.47 |
| Redruth & Truro | 0.44 |
| Leeds | 0.44 |
| Bournemouth & Poole | 0.44 |
| Cardiff & Swansea | 0.42 |
| Leicester | 0.39 |
| Plymouth | 0.35 |
| Norwich | 0.34 |
| Ipswich | 0.33 |
| Edinburgh | 0.23 |
| Sunderland | 0.21 |
| Liverpool | 0.2 |
| Sheffield | 0.19 |
Source: BSD, Tech City UK, 2015