Hurrah for tech – UK digital sector “60% bigger” than thought

You won’t need reminding how much the government has been banging on about the need for our country to go more digital.

And you certainly won’t need us to tell you how important it is to our future that we skill up in digital and gear up for an ever-more technological future. Suffice to say that as the world goes digital, it’s imperative that the UK produces tech firms which can capitalise on the new world order, both to supply our needs and to help our economy grow.

Great news, then, that a new report from The National Institute for Economic and Social Research (NIESR) thinks we might in fact boast 60% more tech companies in this country than the government has estimated. NIESR reckons we’ve got 270,000 active tech firms in the UK, compared with government estimates of 167,000 digital businesses.

NIESR also estimates that digital companies’ revenues are growing a quarter faster than that of non-digital companies.

NIESR’s figures differ from the government as the government bases its estimates of the number of digital companies on the official Standard Industrial Classification (SIC), which was created 65 years ago. NIESR has instead used data from software firm Growth Intelligence.

Max Nathan, senior research fellow at NIESR, said: “Policymakers have identified the digital economy as one of the UK’s key economic strengths.

“That means they need to be aware of the true numbers of digital businesses around the country.

“The old image of tech businesses as start-ups that make no money is out of date too: using big data we show a broad array of active businesses selling digital products and services.”