As the UK nears another General Election, the tech sector remains a standout performer in an economy expected to be a constant source of debate over the coming months
According to the latest KPMG/Markit Tech Monitor survey, the UK tech sector enjoyed a robust and accelerated improvement in profitability in the final quarter of 2014, avoiding the slowdown seen across the wider economy. At 55.8 in Q4, the index measuring tech sector profitability was the second-highest for any quarter since Q4 2007.
The report also gives a positive analysis of the UK tech start-up scene. It reveals that the number of new tech start-ups is rising rapidly and looks to have reached a seven-year high in 2014, after falling sharply in the direct aftermath of the global financial crisis. Start-up numbers are estimated to have risen by around 40% year-on-year and hit a post-crisis peak in absolute terms in 2014.
The future looks encouraging as well, with more than half of the survey panel (53%) anticipating a rise in business activity over the next 12 months while only 7% forecast a reduction.
“The previous survey showed that while tech sector business activity had been strong, the rate of expansion had slowed noticeably,” observes Tudor Aw, partner and head of technology, KPMG. “Remarkably, the final quarter of 2014 marks a period of sustained job creation in the sector that now stretches to five years, something that should be celebrated loudly.”