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Tech leads the way as UK digital industries grow 32% faster than rest of the economy

The UK’s digital revolution shows no signs of abating as the tech sector continues to outpace the rest of economy according to a report released today by Tech City UK.

The figures show that tech firms enjoyed a combined annual turnover of £161bn in 2014 which is 32% more than the average turnover growth of the rest of the economy.

Government-backed Tech City UK, in conjunction with the innovation charity Nesta, published the findings in their Tech Nation 2016 report which represents the most comprehensive study of the UK’s tech industries to date.

Elsewhere, the importance of the digital economy was further underlined by figures which showed that tech job creation grew 11.2% between 2011–14, three times faster than the rest of the economy, and accounts for 1.56m jobs nationwide.

Not only was the tech sector shown to be a strong economic performer, but employees within the sector were also shown to be 90% more productive based on gross valued added (GVA) per worker and enjoyed average salaries 36% higher than the national average at just under £50,000 per annum.

Gerard Grech, Chief Executive Officer of Tech City UK, commented: “Tech Nation 2016 provides an unprecedented insight into the growing economic importance of the UK’s digital businesses.

“This report demonstrates the extraordinary growth rate of the UK’s digital tech industry, and its increasingly profound influence on established non-digital industries, such as retail and health.

“Tech Nation 2016’s findings will prove invaluable to industry, international investors and digital businesses themselves, acting as a detailed topography of the UK’s digital economy and signposting where future opportunities lie.”

Eileen Burbidge, Tech City UK Chair and Partner at Passion Capital, echoed Grech’s sentiments and added: “The UK’s credentials as a home for digital excellence have been well established, and now Tech Nation 2016 provides a new level of insight into the impressive productivity of our digital economy – driving growth across all sectors and regions of the country.

“Tech Nation 2016 will help to inspire the innovative and entrepreneurial spirit required for the UK to continue its growth as a Tech Nation.”

The report also showed that tech growth was strong right across the UK and was not just focused on the usual digital hotspots. With the likes of Newcastle, Liverpool and Sheffield all posting strong growth, the digital revolution is being felt nationwide.

In light of the report’s findings, Prime Minister David Cameron, reaffirmed the government’s commitment to growing the digital economy and said: “Britain’s world leading tech sector gives us a competitive edge that is not just transforming our daily lives but also our economy. Tech is transforming the way we do all kinds of business.

“Indeed, more than half of all digital jobs now aren’t in high-tech hubs of London or Leeds – they are in businesses of every description, in every sector.

“This Government will continue to back, with all levers at our disposal, the innovation, creativity and entrepreneurship that is redefining and strengthening the modern British economy.”

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