In the following sections we have provided an overview of the level of tech contribution for each of the English regions and constituent councils along with an analysis of recent business/employment trends and a summary of key employment changes forecast for the 2020-50 period.
The definitions employed when producing this analysis are presented within appendix 2, and for the tech business base/tech specialist summary sections are consistent with other national/international analysis of tech/digital. It should be noted however, that figures for economic contribution presented are a ‘best fit’ using a broader categorisation of the tech/digital industries (ie section J of the ONS Standard Industrial Classification system) due to the absence of sub-regional data from central statistical sources.
The North East
1. Economic contribution
Total GVA from the tech sector in 2018 was just over £3 billion or 2 per cent of the total across all English regions and, like England as a whole, tech GVA has increased rapidly in recent years (up 46 per cent in each case between 2008 and 2018) and now accounts for 6 per cent of total regional GVA.
By council Newcastle upon Tyne and North Tyneside are associated with by far the highest tech GVA contributions (£0.9 billion and £0.7 billion respectively) and the highest contributions as a proportion of total local GVA (10 per cent and 16 per cent respectively). Interestingly, Hartlepool was associated with the largest growth rate for tech GVA over the 2008-18 period (up 70 per cent). Whilst growth for all other districts was below the regional/national averages.
2. Tech business base
There were 3,000 tech businesses in the North East in 2020 representing 2 per cent of the national (England) total and a number 44 per cent up on that recorded ten years earlier. As a proportion of the business base tech firms account for 4 per cent of all firms in the region – compared with 7 per cent in England.
The largest concentrations of tech businesses in the North East can be found in Newcastle upon Tyne, County Durham and North Tyneside whilst tech business density (the proportion of all firms that are designated as being tech) was highest again in North Tyneside (7 per cent) followed by Newcastle upon Tyne and Gateshead.
3. Tech specialists employment trends
There were approximately 43,000 tech specialists based in the North East of England in 2019 representing 4 per cent of the local workforce and 3 per cent of all tech specialists in England at that time. Tech specialists were most often based in North Tyneside and Newcastle upon Tyne (17 per cent of the regional total in each case) and these two areas were noted for having the highest representation of tech specialists within the local workforce (7 per cent and 6 per cent respectively compared with 5 per cent for England as a whole).
Tech specialist employment has increased within the North East by around 29 per cent over the past five years (2014-19) – a rate of growth far greater than elsewhere across England (for which a growth rate of 22 per cent was observed over this period).
4. Tech specialists employment trends
Employment levels for tech specialists in the North East are forecast to grow by 100 per cent between 2020 and 2050 - rising from 45,000 people to 90,000 people in total, and overall, tech specialists will account for approximately 7.9 per cent of all employment within the region by the middle of the century.
Growth is anticipated to be highest in North Tyneside (increasing by 113 per cent from 2,700 to 5,600 tech specialists) and the district share of tech employment is forecast to rise slightly from 14 per cent to 15 per cent.
Newcastle-upon-Tyne, South Tyneside and County Durham are anticipated to grow their share of tech employment between 2020 and 2050 , whilst tech employment growth is forecast to be below the regional average in each of the remaining eight council districts – each of which will decline with respect to their share of the regional tech workforce.
By tech specialism, tech managers and professionals are forecast to rise by the greatest amount in the North East (110 per cent and 108 per cent respectively between 2020 and 2050) whilst employment in technician and engineering roles will be below the average for the tech specialists across the region as a whole (increasing by 73 per cent or 7,400 people).
Figure 2. High growth areas (above regional average) for tech employment in the North East by council, 2020-50
North Tyneside: 113%
Newcastle upon Tyne: 106%
South Tyneside: 106%
County Durham: 103%
North East: 100%
Gateshead: 98%
Redcar and Cleveland: 96%
Stockton-on-Tees: 95%
Northumberland: 94%
Hartlepool: 92%
Middlesbrough: 90%
Sunderland: 89%
Darlington: 88%
Source: Sagacity Research Ltd
The North West
1. Economic contribution
Total GVA contribution from the North West’s tech sector in 2018 was just under £9 billion – third amongst English regions after London and the South East and 7 per cent of the total. Growth in tech GVA over the past 10 years was below the national figure (36 per cent) though tech GVA still accounts for 5 per cent of the total within this region.
Tech GVA figures in the North West are dominated by Greater Manchester which accounted for 12 per cent of total tech GVA in 2018 (£1.8 billion). As a proportion of local GVA however, higher figures were associated with Halton and Salford in particular (tech accounting for 15 per cent and 13 per cent respectively vs 8 per cent in Greater Manchester). The areas associated with the highest growth in tech GVA though were Hyndburn and Blackpool with growth of 433 per cent and 300 per cent respectively albeit it from a low base level.
2. Tech business base
Amongst the 263,000 businesses based in the North West of England in 2020, 5 per cent or 14,000 were classified as being tech sector firms. By number, the largest concentrations of tech businesses were located in Manchester, Cheshire East and Trafford whilst the density of tech businesses (ie as a proportion of local firms) was highest in Cheshire East again and Stockport - over 20 per cent in each case and in total there were eleven areas with a tech business density of 10 per cent or above and twelve above the England average.
3. Tech specialists employment trends
There are around 131,000 tech specialists based in the North West of England (2019 figures) representing 4 per cent of the local workforce and 10 per cent of all tech specialists in England. Across the North West, Manchester is home to by far the largest number/proportion of tech specialists (approximately 15,000 or 11 per cent of the regional total) and tech specialists account for 6 per cent of employment within the authority putting representation well above the norm for England.
In addition to Manchester there are another six areas in the North West with above average levels of tech specialist representation ie Trafford, Burnley, Ribble Valley, Warrington, Barrow-in-Furness and Cheshire East.
Over the past five years the number of tech specialists based in the North West has increased by 22 per cent - just below the average for England as a whole
4. Tech specialists future forecast
The number of tech professionals in the North West is forecast to grow by 104 per cent between 2020 and 2050 to 274,000 people or 11 per cent of all tech employment at that time. The level of growth anticipated is notably higher than that for England as a whole (84 per cent) and equal fourth highest amongst the English regions.
By council district, growth in tech specialist employment is predicted to be greatest in Salford (132 per cent) and Rochdale (121 per cent) whilst eleven other districts are also considered likely to experience growth rates above the regional average. In absolute terms, however, growth will be concentrated in existing centres such as Manchester (up 16,000), Liverpool, Trafford and Cheshire East (up 10,000 in each case). Conversely, twenty-six districts in the North West are forecast to grow below the average rate, with Copeland and Barrow-in-Furness likely to exhibit the smallest increases in tech employment over the 2020-2050 period (62 per cent and 69 per cent respectively).
Figure 3. High growth areas (above regional average) for tech employment in the North West by council, 2020-50
Salford: 132%
Rochdale: 121%
Chorley: 117%
Oldham: 116%
Liverpool: 114%
Rossendale: 113%
Trafford: 113%
Manchester: 111%
Tameside: 110%
Knowsley: 110%
Stockport: 110%
Bury: 109%
Cheshire West and Chester: 107%
North West: 104%
Source: Sagacity Research Ltd
Yorkshire and the Humber
1. Economic contribution
The tech sector contribution in GVA terms during 2018 for Yorkshire & the Humber was £4.9 billion (the second lowest of all English regions) or 4 per cent of regional GVA. The region has also experienced one of the slowest growth rates with regards tech GVA over the past decade (38 per cent compared with 46 per cent for England as a whole).
Leeds is by far the dominant council area with regards to tech GVA contribution (£2.1 billion or 21 per cent of the total) and tech GVA in Leeds has grown by a slightly higher proportion than in England more widely (48 per cent vs 46 per cent) over the past decade (2008-18). The largest growth in tech GVA over this period was recorded in Richmondshire, Craven and Calderdale.
2. Tech business base
There were 9,200 tech businesses in Yorkshire and the Humber in 2020 representing 5 per cent of the national (England) total and 5 per cent of the local business population. Leeds was home to by far the largest number/proportion of tech businesses (2,200 or 24 per cent of the regional tech total) and tech businesses accounted for 7 per cent of the entire Leeds business base.
Leeds was also associated with the largest change in tech business numbers over the 2010-20 period (up 83 per cent).
3. Tech specialists employment trends
Across Yorkshire and the Humber it is estimated that around 96,000 people (4 per cent of the workforce) hold positions as tech specialists, 7 per cent of the total for England. Leeds is home to a significant proportion of these workers (24 per cent) and 6 per cent of the Leeds workforce in total work in tech roles – a slightly higher proportion than across England as a whole.
The number of people working as tech specialists has risen greatly over the past five years in Leeds (62 per cent) though the highest rates of growth recorded over the 2014-19 period were in York and Kirklees (over 100 per cent in each case).
Other areas associated with above average representation of tech specialists in the region were York, Calderdale and Kirklees.
4. Tech specialists future forecast
By 2050 there are forecast to be 200,000 tech specialists based in Yorkshire and the Humber or 8 per cent of the national total. Tech specialist employment is anticipated to have grown by approximately 104 per cent (103,000 people) and of this employment growth, the largest elements will accrue in Leeds (up 23,000 or 106 per cent) and Sheffield (up by 16,000 or 117 per cent). As such, these two districts will continue to account for the lion’s share of tech employment within the region, with 36 per cent of the total in 2020 and 37 per cent by 2050.
Though these districts will constitute the largest volume growth, the highest growth rate will occur in Wakefield where an increase of 135 per cent is forecast over the 2020-50 period. By contrast, growth is expected to be lowest within Richmondshire at just 71 per cent.
By tech specialism, this growth will equate to an increase of approximately 57,000 tech professionals, 29,000 tech managers and directors and 17,000 technicians and engineers by the year 2050.
Figure 4. High growth areas (above regional average) for tech employment in Yorkshire and the Humber by council, 2020-50.
Wakefield: 135%
Selby: 119%
Sheffield: 117%
Barnsley: 114%
Rotherham: 112%
Doncaster: 108%
Leeds: 106%
Ryedale: 105%
Yorkshire and Humber: 104%
Source: Sagacity Research Ltd
East Midlands
1. Economic contribution
Despite having increased by a rate higher than the England average over the past ten years (54 per cent vs 46 per cent between 2008 and 2018), tech GVA in the East Midlands, at £4.2 billion, was second lowest of all English regions. Moreover, making up just 4 per cent of regional GVA, the tech sector contribution was also well below the norm.
The main contributor of tech GVA in the East Midlands is Nottingham (£0.9 billion or 9 per cent of the regional total though the area associated with the highest growth rate with respect to tech GVA over the past ten years was Broxtowe (248 per cent) which along with Nottingham, Ashford and Newark and Sherwood is also associated with the highest sector contribution to GVA (9 per cent, 9 per cent, 9 per cent and 11 per cent respectively).
2. Tech business base
Tech businesses made up 5 per cent of the East Midlands business base in 2020 and in total amounted to 9,300 firms. Tech businesses were most prevalent in Leicester, Northampton and Nottingham though as a proportion of the local business population, were most concentrated in Rushcliffe, Oadby and Wigston and South Northamptonshire (10 per cent, 8 per cent and 8 per cent respectively) in fact these three areas were the only ones with a tech business density higher than the England average. Oadby and Wigston together with Leicestershire also exhibited the highest growth in tech company numbers over the past ten years – company numbers increasing by more than 100 per cent over the period.
3. Tech specialists employment trends
There were 90,000 tech specialists in the East Midlands in 2019 – 7 per cent of the total in England and 4 per cent of the local workforce. The largest (numerical) concentrations of tech specialists can be found in Northampton, Leicester and Nottingham (10 per cent, 8 per cent and 7 per cent respectively) and Northampton along with Rushcliffe and Hinckley and Bosworth were associated with the highest densities of tech workers (8 per cent, 7 per cent and 7 per cent).
Over the past five years the number of tech specialists in the East Midlands has increased by 21 per cent - just below the national average. The increase recorded for certain council areas however is much greater and particularly notable in the case of Harborough, South Derbyshire, Hinckley and Bosworth, North East Derbyshire, Daventry and Broxtowe (over 100 per cent in each case).
4. Tech specialists future forecast
The East Midlands was home to 93,000 tech professionals (7 per cent of the total for England) in 2020 – a number set to more than double (an increase of 111 per cent) by 2050. As this could likely be the English region with highest prospective growth in tech specialists over the period.
Of the 40 council districts that make up the East Midlands, sixteen are forecast to increase tech employment numbers by a rate exceeding the region average – notably Corby, North West Leicestershire and Blaby (all over 140 per cent). Twenty-six districts will see tech employment growth below the regional rate – though even in Melton where the rate of growth will be lowest, it is anticipated that tech employment will rise by 83 per cent over the 2020-50 period.
Though not associated with the largest growth rates, in volume terms, the largest changes are predicted to occur in Leicester (up 8,000), Northampton and Nottingham (7,000 in each case) whilst by tech specialism the number of tech managers and professionals in the region are forecast to increase in number by 29,000, 57,000 and 17,000 respectively over the 2020-50 period (121 per cent, 119 per cent and 82 per cent respectively).
Figure 6. High growth areas (above regional average) for tech employment in the East Midlands by council, 2020-50
Corby: 148%
North West Leicestershire: 148%
Blaby: 145%
South Derbyshire: 138%
Daventry: 134%
Hinckley and Bosworth: 132%
Charnwood: 128%
Kettering: 125%
Harborough: 124%
Boston: 123%
Rushcliffe: 123%
Ashfield: 120%
South Northamptonshire: 118%
South Holland: 117%
East Northamptonshire: 115%
Bolsover: 113%
East Midlands: 111%
Source: Sagacity Research Ltd
West Midlands
1. Economic contribution
The tech sector in the West Midlands accounted for 5 per cent of the national total in 2018 and was worth £6.5 billion to the regional economy. Growth in tech GVA has been below average over the past ten years (45 per cent vs 46 per cent for England as a whole) and as a proportion of regional GVA, tech in the West Midlands is again below the average for England as a whole (4.6 per cent of regional GVA).
With tech GVA of £1.5 billion, Birmingham accounts for the largest share of tech GVA in the West Midlands though as a share of local GVA, tech is most important to Redditch and Stoke on Trent (11 per cent in each case compared to 5 per cent in Birmingham). Tamworth and Cannock House however are noted for experiencing the highest growth in tech GVA over the past ten years (over 200 per cent in each case).
2. Tech business base
Of the 219,000 businesses based in the West Midlands in 2018, approximately 5 per cent (12,000) were classed as tech manufacturing/service firms – a proportion below the figure for England as a whole (7 per cent). Growth in tech businesses is also below the England average (36 per cent vs 52 per cent respectively over the 2008-18 period) and is below all other English regions bar the East of England and the South West (34 per cent in each case).
By authority, Birmingham is home to the largest number of tech firms in the West Midlands (2,200 or 18 per cent of the total) whilst as a proportion of the local economy Solihull, Coventry, Warwick, Telford and Wrekin and Rugby were notable for having the highest tech business densities (all above the average across England) and 11 per cent in the case of Solihull).
3. Tech specialists employment trends
There were approximately 110,000 tech specialists based in the West Midlands in 2019 representing 4 per cent of the regional workforce and 8 per cent of all tech specialists in England. The primary areas for tech specialist employment within the region are Birmingham and Coventry and together these two council areas are home to 25 per cent of all tech specialists based within the region (15 per cent and 10 per cent respectively). Birmingham and Coventry are not however associated with the highest density of tech workers (ie tech specialists as a proportion of the workforce) and Birmingham actually has a lower density than average for the West Midlands (3 per cent).
The highest concentrations instead can be found in Warwick and Cannock Chase where more than one in every ten workers are in tech occupations (11 per cent and 10 per cent respectively).
In total, the number of tech specialists in the West Midlands grew by 34 per cent over the 2014-19 period which was a rate notably higher than the national average (23 per cent) and the third highest amongst the English regions. The highest rates of growth recorded over this period were in Cannock Chase and Warwick again, together with Rugby, Nuneaton and Bedworth, and Dudley (all associated with growth of over 100 per cent between 2014 and 2019).
4. Tech specialists future forecast
The number of tech specialists based in the West Midlands is forecast to grow by 108 per cent between 2020 and 2050 from 113,000 to 234,000 people. The increase will be driven primarily by a rise in the number of tech professionals (up by 67,000 or 114 per cent) followed by tech managers and directors (up by 34,000 or 117 per cent) and tech engineers (20,000 and 79 per cent).
Across the region the largest increases in tech specialists are forecast to occur in Birmingham (21,000) and Coventry (15,000), followed by Warwick (8,000) and Solihull (6,000) with Coventry also anticipated to experience the highest rate of growth over the 2020-50 period (133 per cent). Conversely, Tamworth and Staffordshire Moorlands are predicted to experience the lowest rates of growth at 73 per cent and 78 per cent respectively.
Figure 7. High growth areas (above regional average) for tech employment in the West Midlands by council, 2020-50
Coventry: 113%
Startford-on-Avon: 127%
Wychavon: 120%
Rugby: 117%
North Warwickshire: 116%
Nuneaton and Bedworth: 115%
Bromsgrove: 114%
Walsall: 114%
Telford and Wrekin: 112%
Solihull: 109%
Warwick: 109%
Sandwell: 108%
West Midlands: 107%
Source: Sagacity Research Ltd
East of England
1. Economic contribution
GVA from the tech sector was valued at £8.6 billion in the East of England in 2018 – the fourth highest of the English regions at that time and 7 per cent of the national (England) total. The sector accounts for 5 per cent of regional GVA in total (fourth of all regions) though over the past decade the financial contribution of the tech sector to the Eastern economy has grown slower than any other however – just 30 per cent over the 2008-18 period.
The main contributor of regional tech GVA is South Cambridgeshire (£0.8 billion) where the tech industry accounts for 13 per cent of the local economy in total – just above the proportion in Welwyn Hatfield (10 per cent). These two regions along with Brentwood were also associated with the largest change in tech GVA over the 2008-18 period across the Eastern region – over 100 per cent in each case.
2. Tech business base
The East of England is home to 19,000 tech businesses – 11 per cent of the England total and 7 per cent of all businesses in the region. The number of tech businesses is up 34 per cent on that recorded ten years earlier (2010) though growth in tech firms was, along with the South West, the lowest of any English region (with average growth of 52 per cent).
This said, there were ten council areas in the East of England in which tech business growth outpaced the national average and sixteen for which tech firms account for a larger share of the business base – notably Cambridge and Watford (13 per cent in each case). The largest numerical concentration of tech businesses however is located in St. Albans - home to 1,000 tech firms.
3. Tech specialists employment trends
The East of England is the third largest with regards to the size of its tech specialist workforce and with 161,000 specialists based there in 2019, the region accounted for 12 per cent of the total for England.
Key areas in the East of England for tech specialist employment are South Cambridgeshire, Central Bedfordshire and Cambridge itself (in each case accounting for around 6 per cent of the regional total). Cambridge and South Cambridgeshire also have the highest densities of tech specialist employment along with Brentwood, St Albans and Three Rivers (10 per cent or above in each case). Central Bedfordshire instead exhibits a density (6 per cent) only slightly above that of England and the East of England region as a whole (5 per cent in each case).
Over the 2014-19 period, tech specialist employment increased by around 30 per cent in the East of England compared with 23 per cent for the nation as a whole though much greater increases were observed in many of the related authority districts and in particular: North Norfolk, Norwich, Brentwood, Rochford, Three Rivers, South Norfolk, Thurrock, Broadland and South Cambridgeshire (over 100 per cent in each case).
4. Tech specialists future forecast
Employment of tech specialists in the East of England is set to grow from 164,000 in 2020 to 292,000 by 2050 – equivalent to an increase of 78 per cent or 129,000 people over the period. By comparison growth across England as a whole is expected to be in the region of 84 per cent over this timespan.
The level of tech employment growth is predicted to be largest for Central Bedfordshire (up 8,500), Chelmsford (6,600) and South Cambridgeshire (5,600) whilst the highest rates of growth are instead most likely to occur in South Norfolk (109 per cent) and Thurrock (104 per cent).
By contrast, the lowest rate of growth for tech specialists over the 2020-50 period is anticipated for Luton (58 per cent) which is one of thirty (of forty-five) authorities within the East of England are predicted to have tech employment growth rates below the overall figure for England during the 2020-50 period.
By tech specialism, the rate of employment growth in the East of England is expected to be much larger for managers/directors (86 per cent) and professionals (84 per cent) in comparison with technicians/engineers (54 per cent) and this also holds true for the scale of employment growth anticipated.
Figure 8. High growth areas (above regional average) for tech employment in the East of England by council, 2020-50.
South Norfolk: 109%
Thurrock: 104%
Colchester: 97%
Tendring: 94%
Peterborough: 94%
Uttlesford: 94%
Chelmsford: 92%
Fenland: 89%
Basildon: 88%
Broadland: 88%
Rochford: 88%
Central Bedfordshire: 87%
Southend-on-Sea: 87%
Breckland: 87%
Bedford: 85%
Maldon: 81%
Welwyn Hatfield: 81%
Harlow: 80%
Norwich: 80%
Mid Suffolk: 79%
East: 78%
Source: Sagacity Research Ltd
London
1. Economic contribution
At £55 billion, the contribution to the economy from London’s tech sector amounts to 45 per cent of the entire figure for England and 12 per cent of GVA within the London region. Moreover, the GVA contribution in London has grown faster that average over the past ten years – increasing by 57 per cent over the 2008-18 period.
Within London, tech GVA is highest in Westminster (£10.7 billion in 2018) followed by the City of London, Hounslow, Camden, Islington and Tower Hamlets – all of which are associated with a tech economy greater than the entirety of the North East (ie the smallest regional tech economy).
Considering tech contributions by borough there are eleven in which tech accounts for over 10 per cent of the local economy and three – Hounslow, Hammersmith and Fulham, and Islington – in which it accounts for over one quarter of the local total (36 per cent in Hounslow). Growth in tech GVA over the past decade (2008-18) however was highest in the City of London, Newham and Hackney (over 100 per cent in each case).
2. Tech business base
There were 55,000 tech businesses in London in 2020 representing 31 per cent of all tech firms in England at that time and 10 per cent of the regional business population. The region is associated with the largest increase in tech business numbers over the past decade – the number almost doubling (up 93 per cent) in the ten years from 2010-20; has twenty-five boroughs in which growth in tech business numbers has exceeded the all-England average (notably Hackney, City of London and Newham with growth of over 200 per cent); and twenty-one districts in which tech business density exceeds the national norm (the highest being in Hounslow and Tower Hamlets at 16 per cent and 15 per cent respectively).
3. Tech specialists employment trends
With a tech specialist workforce of 316,000 people, London accounts for almost one quarter (24 per cent) of tech employment in England and within London itself Lambeth, Hounslow and Barnet are home to a large number of these workers (around 16 per cent of the London total). Lambeth and Hounslow also have the highest concentrations of tech workers in London and in each case over one in ten of the local workforces are employed in tech roles (11 per cent and 10 per cent respectively of the London total).
London is also associated with above average growth in the number of people working in tech and between 2014 and 2019, tech employment in London increased by almost double the rate for England as a whole (40 per cent versus 23 per cent). By London Borough Camden, Barnet, Islington, Newham and Lambeth experienced the highest rates of growth - over 100 per cent in each case.
4. Tech specialists future forecast
London is already home to 321,000 tech specialists (24 per cent of the England total) and this number is set to increase by approximately 60 per cent (193,000) over the 2020-2050 period to over half a million (514,000) in total.
Proportionately, growth in tech specialist employment will be greatest in Tower Hamlets, Greenwich, Hackney and Havering (over 70 per cent in each case) whilst Tower Hamlets again along with Lambeth and Greenwich are anticipated to experience the largest growth in the number of the specialist workers (up 11,300 and 10,000 and 9,000 respectively).
By comparison, London boroughs associated with the lowest growth rates over the 2020-50 period are expected to be Ealing, Kensington and Chelsea, and Harrow (with growth rates of 40 per cent, 42 per cent and 45 per cent respectively) or, with respect to headcount, Hammersmith and Fulham (2,900), Kensington and Chelsea again (1,500) and the City of London (600).
As in other regions, growth rates for tech specialist employment will be greatest for managers and directors (68 per cent) and professionals (66 per cent) as opposed to technicians and engineers (38 per cent) and this also holds true for the scale of employment changes anticipated (with respective increases of 56,000, 110,000 and 28,000 predicted).
Figure 9. High growth areas (above regional average) for tech employment in London by council, 2020-50
Tower Hamlets: 90%
Greenwich: 75%
Hackney: 74%
Havering: 73%
Camden: 70%
Lewisham: 68%
Bexley: 66%
Southwark: 66%
Westminster: 65%
Islington: 65%
Barking and Dagenham: 64%
Newham: 64%
Bromley: 63%
Barnet: 63%
Wandsworth: 62%
Waltham Forest: 61%
London: 60%
Source: Sagacity Research Ltd
The South East
1. Economic contribution
The South East has the second largest tech economy outside of London and in 2018 the contribution from tech businesses stood at £26 billion, or 21 per cent of the total for England as a whole. Though highly dependent upon the tech sector (9 per cent of regional GVA in 2018), the South East has seen one of the smallest increases in the tech sector in financial terms over the past ten years with growth of just 37 per cent - the third lowest by region after the East of England and the North West.
The main centres of tech related economic activity in the South East are Wokingham, where a £3 billion GVA contribution was recorded in 2018, though there are seven other councils associated with contributions of £1 billion or more.
Wokingham also shows the highest reliance on the tech industry (40 per cent of local GVA) whilst there are four other areas in the South East where tech accounts for 20 per cent or more of local GVA (West Berkshire, Reading, Bracknell Forest and Runnymede). Key growth areas across the South East between 2008 and 2018 were: Wokingham, Adur, Sevenoaks, Medway and East Hampshire (over 100 per cent in each case).
2. Tech business base
Tech businesses account for 10 per cent of all companies in the South East and 23 per cent of the England total. At 40,000 companies, the number of tech firms in the South East was up by 40 per cent on the level ten years earlier with the highest rates of growth recorded in Dartford, Slough and Milton Keynes in particular (over 100 per cent in each case).
The largest concentrations of tech businesses in the South East (number) are found in Buckinghamshire and Milton Keynes again whilst tech density is highest in Wokingham, Reading and Slough (20 per cent or above).
3. Tech specialists employment trends
The South East has the second largest tech specialist workforce after London and in 2019 there were approximately 272,000 people working in tech roles within the region or 20 per cent of the England total. The areas of the South East with the largest concentrations of tech specialists are Buckinghamshire, Wokingham, Milton Keynes and Reading (over 10,000 or 4 per cent of the regional total in each case) whilst the density of tech employment is highest in Wokingham, Reading, East Hampshire, Runnymede, West Berkshire and Bracknell Forest (over 10 per cent in each instance).
Despite a base of such a large number of tech specialists, the number of people in the South East working in tech roles increased by just 6 per cent between 2014 and 2019 making this the second smallest regional increase recorded over the five-year period. Much larger increases were observed amongst the constituent authorities, however, and in particular: Thanet, Tandridge, Wealden, Waverley, Eastbourne, Chichester, Swale, East Hampshire, Runnymede, Test Valley, Arun and Hastings (all over 100 per cent during this period).
4. Tech specialists future forecast
There were 277,000 tech specialists based in the South East of England in 2020 and with 20 per cent of the national total the South East is second after London with respect to tech (specialist) employment levels. By 2050 however, the number of tech specialists in the South East region is expected to have risen by around 67 per cent or 186,000 people to almost half a million (463,000) people.
Across the region the growth rate will be greatest in Dartford in particular (a forecast rise of 112 per cent) whilst the increases in numerical terms will be greatest within Buckinghamshire (up 10,600), Wokingham (8,500), Milton Keynes (7,400) and Reading (7,000). Conversely, Rother and Eastbourne in particular will likely experience the smallest increase in tech specialist employment with increases of well below 1,000 forecast to occur in each case (500 and 600 respectively).
Over the 2020-30 period the number of tech specialists working as managers and directors in the South East is forecast to increase by 75 per cent (54,000 people), tech professionals by 73 per cent (105,000) and technicians and engineers by 44 per cent (28,000 people).
Figure 10. High growth areas (top 10 of 33 above the regional average) for tech employment in the South East by council, 2020-50
Dartford: 112%
Swale: 93%
Ashford: 91%
Dover: 90%
Vale of White Horse: 90%
Maidstone: 90%
Tonbridge and Mailing: 87%
Horsham: 81%
Eastleigh: 80%
Wokingham: 78%
South East: 67%
Source: Sagacity Research Ltd
The South West
1. Economic contribution
The tech sector was worth £6 billion to the South West economy in 2018 (ie 4 per cent of regional GVA and 5 per cent of tech GVA across England as a whole) and has increased by 46 per cent over the past decade (2008-18) – a rate well above that for the South West economy as a whole (31 per cent) but on par with tech sector growth in the whole of England.
Bristol is the largest tech economy in the South West (£0.9 billion GVA in 2018) followed by South Gloucestershire (£0.8 billion) though tech accounts for the largest share of GVA within the South Hams area. Over the past ten years the highest rate of growth in the tech economy was recorded in East Devon and Teignbridge where GVA contribution increased by over 200 per cent in each case whilst growth of over 100 per cent occurred in four other authorities over the period.
2. Tech business base
There were 14,000 tech businesses in the South West of England in 2020, representing 6 per cent of the local business population and 8 per cent of tech firms in England. The number of tech businesses in the region has increased by 34 per cent over the past ten years which is an increase well below the all-England figure (52 per cent) and the lowest level recorded amongst all the English regions bar the East of England (also 34 per cent). The number of tech firms has however risen faster than the norm in four councils: Gloucester, Tewkesbury, South Gloucestershire and Bristol (between 53 per cent and 79 per cent).
Bristol and Wiltshire are home to the largest number of tech firms (1,600 in each case), whilst tech density is highest in Cheltenham (11 per cent) followed by South Gloucestershire, Tewkesbury and Bristol again (9 per cent in each case).
3. Tech specialists employment trends
The South West is home to 109,000 tech specialists or 8 per cent of the England total whilst internally, Bristol along with Bournemouth, Christchurch and Poole are the main centres of regional tech employment - these two areas accounting for around 25 per cent of the South West total. The highest tech employment density occurs in Swindon where 8 per cent of the local labour force hold tech jobs compared with just 4 per cent within the region as a whole.
Over the past five years the South West recorded the lowest growth in tech specialist numbers of all the English regions - increasing by just 2 per cent over the 2014-19 period or at a rate three times lower than for the workforce as a whole. Much greater increases were apparent within certain council areas however - notably Gloucester and Torbay (over 100 per cent).
4. Tech specialists future forecast
The number of tech specialists in the South West of England is expected to more than double over the 2020-50 period (an increase of 108 per cent) from 112,000 to 233,000 people.
By council area the rate of growth will be highest in South Gloucestershire (141 per cent), Tewksbury (137 per cent) and East Devon (126 per cent) whilst Dorset, South Somerset and Bournemouth, Christchurch and Poole will exhibit the lowest rates of growth over this period (85 per cent, 86 per cent and 87 per cent respectively).
The scale of the increase in tech specialist employment is predicted instead to be greatest in Bristol (up 19,100), South Gloucestershire (up 9,800) and, again, Bournemouth, Christchurch and Poole (9,200). By contrast the areas of West Devon, the Forest of Dean and Torridge will see only minimal increases in tech specialist workers between 2020 and 2050 (500 or less in each case).
By tech specialism, the South West will see growth in managers and directors of around 118 per cent, the highest level of all English regions, as will be the case for tech professionals (116 per cent). The number of technicians and engineers will grow much more slowly (60 per cent) and this will be reflected in the scale of employment growth for these workers (ie an increase of 20,000 compared with 34,000 tech managers and directors and 67,000 professionals).
Figure 11. High growth areas (above the regional average) for tech employment in the South West by council, 2020-50
South Gloucestershire: 141%
Tewkesbury: 137%
East Devon: 126%
Bristol, City of: 123%
North Somerset: 120%
Mid Devon: 119%
Cotswold: 119%
Bath and North East Somerset: 116%
Teignbridge: 116%
Cornwall: 112%
South West: 108%
Source: Sagacity Research Ltd