Only London is ahead of the region when it comes to new technology firm growth
The North East is second only to London for growth in the number of tech enterprises over the past year, according to research by Nixon Williams, a specialist accountant for finance and banking contractors.
According to an analysis by Nixon Williams, the number of tech businesses in the North East increased by 9.2 percent in 2015, compared to 11.7 percent in London.
The number of tech businesses in the North East jumped from 9,695 to 10,285 between 2014 and 2015. In London the number of tech businesses, rose from 34,755 to 38,810 during the same period.
According to Nixon Williams, in recent years, the North East has emerged as one of the fastest growing UK regions, with the tech sector being a key driver of growth. The surge in new business creation in the tech sector in Newcastle is fuelling a jobs boom, which is encompassing other urban areas, including Sunderland and Gateshead.
Victoria Kelly, practice manager at Nixon Williams, said: “The North East is developing as one of the most innovative tech clusters in the UK. The region has five universities and with software giant Sage headquartered in Newcastle, has a talent pool with appropriate skills. Manchester arguably remains the Northern powerhouse for tech businesses, but Newcastle is snapping at its heels.”
She said: “The North East has a much lower cost base than London, which makes it a perfect location for a startup. Most startups have limited funds but those based in the North East would be able to allocate more cash to product development than an equivalent business in London, which would have to contend with much higher property and staffing costs in the capital.”
Nixon Williams points out that ignite100, the tech accelerator programme, has one of its three UK bases in Newcastle, and through venues such as Campus North is providing a support network for tech entrepreneurs and investors.
According to Nixon Williams, Wales is the second fastest growing region outside London for tech startups. Wales saw an 8.7 percent increase in the number of tech businesses between 2014 and 2015, from 2,630 to 2,860.
Over 28,000 people from the South Wales region alone are employed by digital companies, according to a recent Tech City report, with 98 percent of those businesses expecting their revenue to increase in 2016.