Look again! Has the government told the full story of the UK’s digital boom?

digital economic sectorWith economic news and forecasts erring on the positive rather than the negative for the first time in what seems like a long while, there are some within the UK’s digital economy who have a bone to pick with the government. The particular contention is that when selling the UK’s digital economy to investors from overseas, the government has been too cautious and seemingly undervalued the market.

The government’s own estimate places some 120,000 businesses in the UK as working within the digital economic sector. Those numbers seem quite substantial, but pale into insignificance when compared to the figures quoted by a recent National Institute of Economic and Social Research (NIESR) report. The outcome here posits that some 270,000 firms are active in the digital economy.

So what do the contrasting outcomes tell us about the UK’s seemingly flourishing digital sector? Hannah Havekin of PayMatters, a firm specialising in providing tax compliance and payroll advice to contractors, gave us her views: “There are a couple of clear pictures offered by the data provided. Firstly, can we say the government uses an outdated system in terms of collecting economic data related to the digital economy? It would seem so. The NIESR has collected data by assessing digital footprints; tracking online the sector and sales performance of firms. This has in turn unmasked a raft of digital firms that do business ‘facing’ traditional industries. So, an engineering firm specialising in hi-tech may supply the oil industry, for example, but government data will place that firm outside of the digital economy it clearly operates in. This is what frustrates digital operators who feel the government’s cautious message about the size of the sector is hampering overseas interest in investment in the UK.”

Hannah continues “Secondly, it is great to see just how much the digital economy in the UK is driving growth and proliferating into other sectors. Estimates given show us that digital firms are growing 25% faster in terms of revenues, and also hiring at 15% faster rate than non-technology operators. Hopefully our policymakers will truly grasp just how much potential lies in our tech-led, digital economy and help investors realise their interest.”

PayMatters are APSCo accredited, professional passport approved and are business partners with the Institute Of Recruiters (IOR). PayMatters pride themselves on being fully HMRC compliant from an employers and employees NI, PAYE and expense perspective. For further information please contact Hannah Havekin, Business Development Manager on 07787 428 456, hannah.havekin@paymatters.co.uk