Digital pioneer Tim Berners-Lee created the world’s first website back in 1991. And for many years, the internet remained the domain of geeks and hobbyists. Back then, it was hard to believe that the internet would become a vital part of the UK economy
But today, the digital economy is huge. New research from Tech City UK suggests that, in the UK, over 1.46m people are employed in digital businesses and 45,000 digital jobs are being advertised at any given time.
What’s more, the report says that employment in digital jobs is set to jump 5.4% by 2020m ensuring digital businesses form a bigger proportion of the UK economy as a whole.
Digital businesses aren't just in London
Whenever the digital economy hits the news, there’s a tendency to focus on ‘Silicon Roundabout’ in London. Situated in the east of the capital, the past decade has seen digital and web-based businesses flock to this area.
As you’d expect, the Tech Nation Report reveals that London has more digital businesses than any other town or city in the UK. However, the vast majority (74%) of digital businesses are based outside the capital.
Clusters of digital businesses are spread right across the UK, from Dundee and Glasgow to Cardiff, Bristol and Reading. About half have been formed since 2008 and 15% of all UK companies founded in 2013-14 were digital.
In short: the digital boom isn’t just a London thing. It’s happening across the country and it’s creating opportunities as it disrupts traditional sectors.
Digital businesses are small businesses
Given that digital companies tend to be younger than your average business, it’s no real surprise that they also tend to be smaller companies.
In fact, the research found that 98% of UK digital firms are classed as small businesses (although the definition of a ‘small business’ is hard to pin down from the report).
Indeed, it’s often claimed that digital tools have the ability to level the playing field, enabling tiny companies to compete with big ones.
Innovations like cloud computing, selling online and location services can make it easier for small companies to do more with less.
The future of digital business
So, the digital economy is in rude health then, right?
Well, yes, probably. Although some pundits do speculate that we’re creating another tech bubble of the type that led to the dotcom crash of 2000, there’s a big difference. Digital businesses are bringing in real revenue, as well as spending money.
Sure, there’s going to be some consolidation over the next few years. For instance, how many online laundry companies does London really need?
But when you look at online shopping habits, smart phone ownership, social media use or practically any other indicator, it’s clear we’re all spending more time online than ever before. Digital will have its ups and downs, but its here to stay.
Perhaps the day is approaching where the digital economy is just the economy. And perhaps every business will be a digital business.