Scotland’s tech sector ‘still in growth mode’ despite political uncertainty 

The digital technologies sector in Scotland remains firmly in ‘growth mode’ despite fierce competition for top talent and ongoing political uncertainty, according to the latest annual industry survey conducted by ScotlandIS. 

The number of technology companies in Scotland reporting increased sales grew from 68% to 75% while those improving profits also increased, from 47% to 51% of companies surveyed.

The strong growth the industry has demonstrated over the last 10 years is set to continue in 2019. Some 83% of respondents to the ScotlandIS survey expect to expand sales over the next year, and 81% plan to create new jobs. 

However, tech companies have identified some challenges ahead, which have contributed to a slightly less favourable outlook this year, with the number of firms expressing optimism down from 80% last year to 72%. 

Key issues facing the sector in 2019 are staff recruitment and retention (52%), the current political situation (41%), and sales and winning new business (30%).

With the digital industries generating, £6bn in GVA, and £3.3bn in annual export earnings, 53% of businesses responding to the survey reported that they are already selling internationally and a further 19% are planning to. Demand for university graduates remains steady, with 70% of respondents likely to recruit graduates this year.

Companies say that the greatest opportunities for their business over the next 18 months are to be found in in artificial intelligence and machine learning (46%), data analytics (45%), Internet of Things (32%), and cyber security (29%). “This highlights data-driven innovation and cyber security as areas of significant opportunity for our industry,” says the report.

ScotlandIS recently announced the creation of data and cyber clusters designed to enable businesses to “collaborate and develop new products and services, open up new markets and compete globally”

As increasing use of technology products and solutions permeates all parts of the economy there has never been a better time to be in tech.

Polly Purvis.

Polly Purvis, chief executive of ScotlandIS, said: “The digital technologies industry is a major contributor to the Scottish economy, so it’s great to see the vast majority of Scottish tech businesses are expecting a successful year, anticipating growth in sales and new job creation.

“2018 was a very strong year, and despite ongoing uncertainty, this year’s survey highlights the strength and resilience of the industry within Scotland. The technology landscape is constantly evolving and provides huge opportunities in areas as diverse as data, cyber, AI, robotics, fintech, healthtech and agritech.

“As increasing use of technology products and solutions permeates all parts of the economy, underpinning increased productivity and enabling innovation, there has never been a better time to be in tech.”

The Scottish Technology Industry Survey 2019 was carried out between 7 January and 16 February 2019 through an online survey platform and received responses from 160 businesses.