Wednesday, May 29, 2024

Number of tech company start-ups in East Midlands jumps 20%

The number of new technology companies incorporated in the East Midlands jumped by a fifth (20%) to 1,627 last year, up from 1,358 the prior year. The figures suggest the region’s tech sector remains resilient despite broader economic challenges, according to analysis by audit, tax and consulting firm RSM UK.

Sheetal Sanghvi, office managing partner, RSM Nottingham said: “It is great to see the continued growth of tech incorporations in the East Midlands. From cyber security and artificial intelligence to data analytics and fintech, businesses in the region are pushing boundaries, helping the UK lead the way in the global tech market.

“With a rich ecosystem of start-ups, established tech giants, and pioneering academic research from its universities, the region continues to be a beacon for technological innovation and entrepreneurial spirit. Many of the groundbreaking technologies and digital solutions that businesses across the UK benefit from originate from the East Midlands and this is attractive to tech entrepreneurs wanting to set up on their own.”

The national data shows a total of 51,017 tech companies were incorporated in the UK last year, up 22% from 41,972 the year before. Key sub-sectors that saw significant growth included software developers, data businesses and IT consultancies.

All regions in the UK saw an increase on the previous year, except for Wales which still incorporated 1,150 businesses, a small decrease from 2022. Tech incorporations in London rose by more than a quarter (26%) on the previous year’s figure to 26,060.

Ben Bilsland, partner and technology industry senior analyst at RSM UK, said: “Our research is testament to the resilience of the UK’s tech sector despite global challenges. The rise in tech incorporations shows there is cause for optimism in this key industry.

“Whilst it’s impossible to ignore AI as a driving force behind UK tech incorporations, especially for businesses working in data, there will be other factors to consider. London projects itself as a leading global authority in tech, and that strength is reflected across the UK by a vibrant and energetic sector that consistently supports early-stage businesses.

“But the sector has, and continues to be, marked by layoffs, so it may be that these members of the workforce have been confident enough to go it alone, thereby fuelling incorporation growth.

“The government has an important role to play if this trend is to continue. Making valuable resources, including AI compute, accessible for universities and early-stage entrepreneurs is critical.

“Funding and policy changes, including innovation reliefs, that ensure a world-class tech workforce are crucial both in terms aiding education and skilled immigration. For those businesses working in AI, clarity on future regulation will assist the ability to forward-plan.”

Tech company incorporations by year  

Region

2022

2023

% change

East Midlands

1,358

1,627

20%

East of England

2,853

3,730

31%

London

20,627

26,060

26%

North East

605

704

16%

North West

3,167

3,602

14%

Northern Ireland

373

377

1%

Scotland

1,280

1,553

21%

South East

4,614

5,160

12%

South West

2,072

2,422

17%

Wales

1,257

1,150

-9%

West Midlands

2,230

2,797

25%

Yorkshire and The Humber

1,536

1,835

19%

Total

41,972

51,017

22%

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