UK tech talent shortage threatens to stifle growth in the industry

The UK technology sector has a talent shortage which could "stifle growth", an industry body has warned.

Liz Scott, from TechNation, said it was "a real issue" which must be rectified.

There were more than two million UK job vacancies in tech last year, more than any other labour area, but an industry coalition says nearly 12 million workers lack essential digital skills.

The government told the BBC it was working very closely with industry on digital skills training.

However, schemes like boot camps, apprenticeships and degree apprenticeships do not seem to be enough to address the gap.

Michelle Donelan, former education minister, said: "Employers both large and small are crying out for more people to be trained in digital skills.

"An apprenticeship is a fantastic way to achieve that. Not just for young people, but also those looking to upskill."

But, according to government figures, nearly half of all apprentices across all sectors, not only in tech, dropped out last year.

Data cited in the latest UK jobs report from professional services network KPMG and the Recruitment and Employment Confederation showed candidate numbers for job vacancies has been falling.

The report said this is because of:

• a generally low UK unemployment rate

• concerns over job security

• increased economic uncertainty, which made people wary about moving jobs

Coding at the National College for Digital Skills

One place which is teaching young people important tech subjects is ADA, the National College for Digital Skills, in London.

It encourages students towards core Stem subjects - science, technology, engineering and mathematics - that form the backbone of the industry.

Principal Tina Gotschi said: "A lot of the jobs that these students will do in the future don't even exist at this point - a lot of those will be digital jobs.

"The college was initially founded to address the skills gap, but unfortunately over time, it is just getting greater.

"The pipeline of students coming through is shrinking and there is a lack of computer science teachers too."

There is a financial incentive to getting digital skills. According to TechNation, tech salaries are nearly 80% higher, on average, than salaries for non-tech jobs in the UK.

The average tech salary is £62,000, which is more than double the average household income in the UK.

Ronan Harris, managing director of Google (UK and Ireland) told the BBC that big tech companies are trying to play a part in providing people with qualifications.

"We've trained over 800,000 people in the UK in a range of digital skills," he said.

"We want people to be excited about technology. But increasingly, what we're seeing is all jobs that are being advertised have some form of digital requirement to them."

It's a sentiment with which Ben Francis, founder of online clothing apparel company Gymshark, agrees.

"The historical view of someone that works in tech, he's probably, you know, a bit more of like a geeky sort of person.

"But I think the more unconventional view of techies is that tech is a creative outlet."

Gymshark is a UK tech start-up success story. The company achieved unicorn status in 2020, meaning it is valued at $1bn (£848m) or higher.

"If you're a great graphic designer, if you're a great web designer, if you want to create great apps or NFTs - all of that is done through tech and understanding of tech," said the entrepreneur.

Gymshark became a unicorn in 2020

James Hallahan, director at recruitment company Hays, said: "Due to the increase in digital transformation over the past few years - the demand for tech talent shows no signs of slowing down."

He added that roles with skill shortages included software developers, data scientists, data analysts, enterprise architects and programme and project managers.

However, a sizeable chunk of the British workforce is nowhere near skilled enough to apply for positions like those, according to industry coalition FutureDotNow. It says that some 11.8 million workers lack basic digital skills - let alone more complex ones.

However, Ms Scott says: "There are good jobs available here. We just need people to understand that they're available and then know how to access them and know where to get the right signpost in for retraining or reskilling courses."

Out of London

Where people live may also be becoming less of a barrier.

Over the last decade, UK companies like Deliveroo, Darktrace and Depop have been started, funded and scaled by driven entrepreneurs and investors.

Fintech companies are also growing, with the likes of Monzo, Starling, Marshmallow and Cazoo all achieving unicorn status.

The majority of them have had major ties to London, but that is slowly changing.

Demand for tech talent is increasing across the UK with the number of professionals with the right skills expanding at a faster pace in the north of England than in London, according to information technology company Accenture.

Shaheen Sayed, its technology lead in the UK, said: "Businesses have been bullish in investing in technology and hiring - particularly in skills such as AI, cloud and robotics.

"The pool of technology professionals is also expanding, with growth in the north [of England] outpacing growth in the south [of England], and emerging technology hubs in Edinburgh and Manchester starting to compete with the capital."

Follow Shiona McCallum on Twitter @shionamc