But why do the world’s tech innovators care about what a tiny island on the other side of the ocean is doing? What are they hoping to learn, and what is the nation doing so different from the US to be viewed as an industry influencer?
The UK’s technology sector is in a period of flourish with a turnover of £170bn and an impressive £6.8bn investment in 2016 – twice as high as any other European country. Digital salaries in the UK are 44 per cent higher than the non-digital, averaging at £51k, with over 1.64m jobs within the sector. Tech shows signs of a continued growth with job creation rates being twice as fast as the wider economy.
The 20th century’s wave of technology innovation began to dominate sooner in the US. With resources heightened during the Cold War, America was able to begin setting its tech routes in the 1960’s and 70’s with the first signs of emerging startups and the birth of Silicon Valley. Comparatively, there are now 6.7m technology workers in the US, with almost 200,000 jobs being added between 2014 and 2015 according to Cyberstates.
There are many differences between the two industries. First and foremost, earnings are higher in the US. Comparing data from a Salesforce salary survey, a mid-level developer in the US earns over twice as much as their UK equivalent, with an average expected £52,838 in the UK and an equivalent to £109,222 in the US.
Many factors could influence this disparity. Cost of living is higher in the US due to healthcare, private pensions and a general difference in the distribution of wealth. Taking aside living expenses, comparably, those earnings still surpass what can be expected in the UK. This could be as simple as a greater maturity of the industry as a whole, causing sought after skills to push salaries higher. Another reason could be a talent shortage which drives up salaries.
Talent shortages are now emerging as a key issue for both nations. Another Tech Nation 2017 finding stated 50 per cent of bosses are naming talent shortages their primary concern. Meanwhile in America, it’s reported “there are 607,708 open computing jobs in the US, but only 42,969 computer science students graduated into the workforce”. The problem may be emerging in the UK, whereas the US has dealt with it for some time.
This begs the question, what is it that Bostonians are looking for in the UK? Why do they believe the nation is an industry influencer? The UK has its own history of notable achievements, being home to some of the greatest tech minds in history (Alan Turing, Tim Berners-Lee to name a few).
Today, the story is much the same. As mentioned, tech investment is highest in the UK against the rest of Europe, and two thirds of this investment happened outside of London, showing digital growth is a national story. In Newcastle, tech startups increased by 39 per cent in five years. The North East is home to three of 30 technology clusters (Newcastle, Sunderland, and Middlesbrough) showing the vast opportunity in the area.
Perhaps it’s for this reason Boston are deeming it an industry influencer, taking note of development here. From a heritage of industrial decline, 2017 saw the North East back on its feet, excelling and showing signs of an impressive business ecosystem contributing sustainability and opportunity.
The world is changing. With communication and travel no longer a burden, enterprise is becoming global. Geographic boundaries could become less of a factor in global economies, and we could see more shared knowledge and resource between business across the world. However, shifting attitudes towards immigration (Brexit and the Trump presidency, to be brief) could hinder potential international business opportunities. Additionally, these attitudes could contribute to the previously mentioned talent shortages due to less freedom to roam for skilled workers.
Only time will tell how the UK and US will grow technology industries – in silos or in unity. One thing that is clear, as society digitalises, the technology industry dominates, and our nation truly is an industry influencer. We can only speculate how far business will come in the next five years, but if you’re not thinking about how your business is growing its digital assets, you may be fall behind.
Maria Baranowska is an outreach executive at Mason Frank International