2022 cemented the UK’s position as a true tech superpower.
A report from The Department for Digital, Culture, Media & Sport revealed that the UK is home to more high-growth digital companies than any other European destination and has retained its spot as Europe’s tech leader.
The UK has created 144 unicorns, 237 futurecorns and is home to more than 85,000 start-ups. These new figures showcase how the ecosystem is expanding. In 2021, there were 116 unicorns and 204 futurecorns here in the UK.
Looking globally, the UK tech scene is a real contender. Amidst a global backdrop of difficult economic conditions, it remains the only real challenger to the stronghold of the US and China. The combined value of UK tech companies has reached $ 1 trillion.
But what are its other impacts on the UK economy and what impact could it continue to have on the growth of the economy here in the UK?
UK Tech Investment – The headlines.
- The UK has more global venture capital investment than any other European destination.
- This includes funding from General Catalyst, Sequoia, and Lightspeed. Over the last 5 years, UK tech has raised nearly £ 1 billion. Looking more recently though, UK tech companies raised £24billion in 2022 alone.
- This is more than the levels reached by France (£11.8 billion) and Germany (£9.1 billion) combined.
- The UK remains the dominant country outside the US for fintech investment – nearly £10 billion was raised throughout 2022.
Edtech and upskilling.
Tech is adding value to the UK economy through its ability to enable digital confidence and make technology accessible.
Upskilling and reskilling have become a key part of the UK’s dominance. Across every sector, the advances in technology have created working environments where digital literacy is critical.
Nearly 3,000 edtech start-ups have raised a collective £1.87 billion in funding over the past five years. Edtech has the power to create a digital workforce.
Through initiatives such as technology apprenticeships, and by offering access to coding, development, and cyber security, these organisations are focused on enabling people to gain the skills they need to succeed in technology roles and beyond.
Within the digital sector we are experiencing a significant shortage of skilled workers. This shortage has been identified as one of the biggest threats to UK tech growth.
To address this, UK companies are increasingly hiring for entry-level tech roles. According to the job search engine Adzuna, UK companies advertised 6,596 junior roles last year. In 2023, the number stands at over 15,000.
Strategies such as this welcome a new generation of talent and enable a growing workforce to develop into future leaders.
The UK is becoming a leading hub for Impact Tech. These are companies creating technological solutions to reach the UN Sustainable Development Goals.
There are nearly 1,200 impact tech companies in the UK that have raised £3.12 billion in funding over the last year. This topped the monies raised across the same period YoY (£3 billion).
The steady influx of investment means the sector now employs more than 53,500 people, up from 37,500 last year.
Green energy receives the bulk of the investment within the Impact Tech domain. For example, Newcleo, a start-up that is developing technology to enable safe uranium recycling received £258 million in 2022.
AI is another area that is dominating UK tech. It’s estimated that the growth within the UK AI ecosystem could add an additional $756 billion to the UK economy by 2035.
Are you interested in reading more?
You may enjoy these related articles