Most UK digital companies based outside of London

The government-backed Tech Nation report reveals technology clusters nationwide are driving the UK's digital and wider economy

The UK’s technology clusters are driving economic growth nationally, with 74% digital companies based outside of London, according to Tech Nation.

Tech Nation is a project developed by Tech City UK, in partnership with DueDil, and focuses on mapping the growth of digital businesses in specific regions or “clusters”.

According to Tech Nation’s report, 1.46 million people are employed in the digital industries, which equates to 7.5% of the entire UK workforce.

The highest rates of digital employment were found to be in London, Bristol, Bath, Reading and Greater Manchester.

The fastest growing UK tech clusters, based on digital companies formed since 2010, were found to be Liverpool, London, Belfast, Greater Manchester, Bournemouth, Brighton and Hove, south Wales and Bristol and Bath.

Clusters that had the highest density of digital companies, compared to overall companies, were Brighton and Hove, London, Berkshire (including Reading), Edinburgh and Cambridge.

Companies found to have the highest average turnover were based in Greater Manchester, Belfast, Sheffield,London and south Wales.

Prime minister David Cameron said: “Backing the industries of the future is a key part of our long-term economic plan to support business, create more jobs and build a more resilient economy. The digital economy has become an integral part of our country and the rapid growth of many digital businesses has confirmed Britain’s position as a global hub of technology excellence.

“We are committed to supporting the growth of our digital industry nationwide and Tech Nation shows the great innovation and thriving entrepreneurial spirit that is driving the sector forward across the country.”

The figures revealed that digital job growth is predicted to outperform all other UK sectors by 2020.

Chancellor of the exchequer George Osborne said: “The UK is a world leader in the technology and digital sectors and what’s so exciting about today’s Tech Nation report is that it shows how we’re seeing the growth of tech businesses right across the country.

“As part of our plan for a truly national recovery we will do everything we can to support this growth and back the different tech clusters that are emerging around Britain.”

The analysis also revealed that 77% of digital companies in the clusters believe they benefit from accessing a network of entrepreneurs to share ideas.

Joanna Shields, chair of Tech City UK and digital adviser to the prime minister, said: “The UK is recognised on the world stage for its tech and digital strengths. Today’s report reveals the depth of the sector and the complex array of skills, specialisms and strengths that truly make us a Tech Nation.

“The unprecedented level of detail and analysis of business starts, revenue and job growth give us a firsthand view of the clusters and businesses that make up the UK digital economy. We are a Tech Nation and we hope this project will inspire innovation and growth for years to come.”

Read more on IT technical skills