The annual Tech Nation Report, published today, highlights the increasing strength of Scotland’s digital technology sector, with the number of businesses and employees in the sector growing.
The report, which provides a comprehensive overview of the UK’s technology ecosystem, shows that the UK tech sector performed well in regards to investment last year.
For the first time, the report also explores the global technology landscape, focusing specifically on international and national tech investment, areas of potential growth and related specialisms, talent hubs and more.
According to the report, in 2018 the UK attracted 5% of global high-tech scaleup investment, placing it fourth in the world ahead of European counterparts such as Germany, France and Sweden.
Investment in UK high-growth digital tech firms also grew 61% between 2017 and 2018, with the report underlining the importance of ambitious UK tech scaleups.
Scotland’s tech ecosystem continues to flourish
While London continues to remain the UK’s leader in attracting high-growth investment, with £9 billion invested between 2015 and 2018, regions and individual cities across the country continue to attract global attention.
The growing strength of Scotland’s technology ecosystem was previously highlighted in CBRE’s ‘Tech Cities’ report, published in April this year. The report, which ranks the top UK locations for tech businesses, pinpointed both Glasgow and Edinburgh as prime locations for companies to do business in – with Glasgow ranked second-best UK city outside of London.
Edinburgh, meanwhile, retained its position in third place, with Manchester ranked as the top city outside of London.
According to the Tech Nation report, turnover from digital technology businesses in Scotland currently stands at £3.9 billion. The number of technology businesses also stands at 9,000, while the number of people working in the sector has reached 58,000.
Despite strong nationwide figures on investment and growth, the UK underperforms on a global scale in regards to tech productivity (turnover/employees), with figures standing at £99,301. Productivity across Scotland’s tech ecosystem fairs well, however it lags behind the UK average at £68,000 per worker.
Commenting on the report findings, Scottish Secretary David Mundell MP said: “Scotland has a well-deserved reputation for world-class innovation and design and it is great to see our multi-billion pound digital tech sector continue to thrive and make a vital contribution to our economy.
“This report shows Scottish expertise – backed by UK Government funding – provides the perfect environment for companies to flourish here, and there are now 9,000 businesses employing almost 60,000 people in this area. We are at the forefront in pushing the boundaries in areas such as artificial intelligence, big data, cybersecurity, fintech and gaming.”
World-leading fintech sector attracts investment
The UK’s strongest sub-sector is fintech, where it currently ranks as world number one. Investment in high-growth UK fintech firms surpassed £4.5 billion between 2015 and 2018. Similarly, Scotland’s fintech sector continues to flourish, with statistics published by FinTech Scotland in January underlining the ongoing excitement, innovation and growth in this area.
The number of Scottish-based fintech SMEs increased three-fold between January 2018 and 2019, with Scotland now home to more than 80 innovative firms.
This growth, FinTech Scotland said at the time, has been largely driven by new startups, along with existing fintech firms choosing to move their operations to Scotland.