Here's how to fix the UK's tech brain drain

Here's how to fix the UK's tech brain drain

Summary: Poor leadership, equally poor transport links and a shortage of finance are exacerbating the north/south divide in technology skills.

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According to think tank Policy Exchange, somewhere around 1.2 million people are now employed in the technology sector in the UK. The problem is that instead of being equitably distributed around the country, this employment is focused in the south-east.

It found the concentration of tech employment in the south-east is greater than the national average in as many as 47 of the 66 UK local authorities — for example, with Wokingham having more than five times the national proportion people employed in technology.

In London, 21 out of 33 local authorities have a higher proportion of workers employed in technology-related roles than the national average and between 2009 and 2012, 27 percent of all new jobs in London "could be attributed to the technology sector", Policy Exchange said. It estimates that there were 34,000 tech businesses in London.

The problem as Policy Exchange sees it is that responsibility for promoting technology is too often devolved to different organisations, meaning that individual areas do not have local champions. Inspired by the example of London mayor Boris Johnson, the think tank want to promote the idea of directly-elected mayors.

This is one of three key ideas being promoted by the Policy Exchange. They are:

  • Reviving the idea of directly elected mayors with "appropriately devolved powers to lead economic growth in their areas" including developing tech clusters.
  • Investing in rail and road infrastructure to better connect northern towns and cities.
  • Encouraging universities to let students retain the intellectual property of products or services they create while studying. Stronger bonds between the university and graduate may help retain more top quality entrepreneurs in the local area.

The think tank pointed out that the north/south brain drain is getting worse all the time. More than a third of graduates from major universities leave the north-east (37 percent) and north-west (36 percent) every year while in Yorkshire and Humberside this figure is as high as 55 percent.

Another part of the problem is confusion over responsibility for enterprise development, the exchange said. As many as 37 local authorities are covered by more than one Local Enterprise Partnerships (LEPs), "creating a mismatch between the geography over which LEPs have responsibility and the business communities on the ground", the report said.

On the finance front, a study by the UK Business Angel Association found that businesses in London and the south-east attracted more than half (54 percent) of angel funding in 2012/13.

And then there is the transport issue where the exchange found that the average speed of journeys from Manchester, Newcastle, Liverpool, Leeds and Sheffield to London was 77.6mph. This compared with an average speed between those same northern cities of just 46mph.

"Slow journeys make it harder for people to move between clusters to access and share work, ideas and opportunities," the exchange said.

The Policy Exchange is a centre-right think tank which the Daily Telegraph described as "the largest, but also the most influential think tank on the right", while the New Statesman described it as prime minister David Cameron's "favourite think tank".

Further reading

Topics: Emerging Tech, E-Commerce, Government, United Kingdom, Education

About

Colin Barker is based in London and is Senior Reporter for ZDNet. He has been writing about the IT business for some 30-plus years. He still enjoys it.

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4 comments
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  • Its now an entrenched attitute amongst the elite that is the problem

    Every time you turn on the TV you hear celebrities and commentators telling us “how wonderful” London is and that everything should be there because it is the capital... and this has become engrained in the mind-sets of execs and employers. The problem is now so bad that some businesses appear almost embarrassed to admit that they are not based in London. This is very evident in the Scottish Independence debate. They talk about splitting from the UK but then when they are engaged in a debate you quickly realise that they actually simply want a divorce from London (Westminster). It makes me wonder if there is not now a case for London becoming a city-state like Singapore?
    techietubby
  • it's about money

    If USA companies pay more... you can do nothing against it.
    aviamquepasa
  • In Theory technology Allows you to work anywhere

    The idea that employment in technology should be focussed around specific geographical places seems very 20th century. The internet should mean work from anywhere. However it doesn't. IT jobs that pay the most are in London and the south east. London has moved from just being a capital to being a 'world city'.

    We seem to be in a situation of concentrated hubs of activity. Once a 'hub' of a particular industry is created - such as IT or finance - people involved in that industry are sucked in. This makes the 'hub' bigger and sucks in still more.

    One of the things that created higher paid IT jobs in other parts of the Uk was public sector employment. As the public sector declines wages in the IT sector outside London are getting less competitive along with poorer opportunities driving people to work in London.

    The only way of reversing this trend is to establish 'hubs' in other parts of the UK. Improved regional transport making movement of commuters easier will help that trend. Transport spend in London is significantly higher than in the rest of the UK.

    Mayors are not specifically the answer. Transport has primarily been fragmented in the UK through rail and bus privatisation. The London Mayor has authority to integrate ticketing and transport links with single ticketing systems and the services working together. The regions have to cope with multiple private providers with different timetabling, ticketing systems and variable prices across local authority boundaries.

    I live in the north and to earn more I would have to go to London or the south east. By staying in the north I will earn less and collectively the regions will suffer from relative decline.
    Stephen Townsley
  • Dumb Article with no challenge, or common sense or knowledge applied

    A fairly crappy re-blogging article with no challenge to the Think Tank, and their agenda, and no expert analysis.

    It also fails to mention one of the self evident reasons why Wokingham/Reading has a high tech density, that is where both Microsoft and Oracle have their UK Head Offices.

    Until companies, and government, relocate tech jobs outside of the South, like the thriving Tech scene in Edinburgh (like skySkanner) or Dundee (Games like Grand Theft Auto series) it will end up concentrating them there - just like tech in Silicon Valley, Redmond USA and other places where corporates have grown up. You'll be telling us next there is an excess of finance jobs in London, New York, Frankfurt, Tokyo, Hong Kong, Shanghai and Singapore next

    Everytime there is a new Government IT initiative announced, you put your head in your hands when it is announced it will be in London - the Cyber Crime Initiative could easily be in Cardiff, Exeter, Edinburgh, Newcastle-upon-Tyne, Carlisle, Leeds, Thurso, Aberdeen, Hull, Manchester etf....
    SmartPlanetHunter