New business volumes rose at the slowest rate since mid-2013 in the first quarter of 2015, according to the Tech Monitor UK survey from consultancy KPMG and financial information firm Markit, but over two-fifths of businesses anticipate an increase in their hiring numbers over the next year.
The UK Business Activity Index was 55.7 in the first quarter, a drop from 59.6 in the fourth quarter of 2014. The survey’s record high was in the first quarter of 2014, which was recorded at 60.5.
The report tracks the performance, confidence and employment outlook of UK technology businesses, with any figure above 50 indicating an increase. The higher the number, the faster the growth.
Tudor Aw, partner and head of technology sector at KPMG, said the first quarter's results show a robust and thriving technology sector that outstrips the wider UK economy.
“The sustained rise in technology business activity has translated to re-investment in capital expenditure and job hiring at a higher rate than other UK sectors,” said Aw. “These results confirm the importance of the technology sector in helping drive growth and employment in the UK.”
Read more about IT jobs
- There has been rapid growth in the number of IT sector vacancies in the first four months of 2015.
- BT plans to create a number of new roles in software development, IT, engineering and digital technology.
- Workforces will become frustrated if they do not have the technology they need to deliver what their organisation wants.
Aw said the survey revealed that the technology sector has expanded by almost one-quarter since 2010, “delivering three times the rate of job creation than the wider UK economy, accounting for over one million jobs”.
Of the IT companies surveyed, 55% anticipate a rise in business activity in the next 12 months and only 7% forecast a decrease. The results also showed 29% expect a rise in capital expenditure, but 14% predict a fall.
“It is an important message to all political parties in the upcoming general election that the technology sector is worthy of support and focus, particularly when it comes to promoting the sector and investing in vital Stem [science, technology, engineering and maths] education to meet the demands of tomorrow’s technology businesses,” said Aw.