Business News Round Up (29/11/2021)
UK has 4th largest digital economy in the world
New analysis has found the UK Europe’s largest digital economy. Despite this growth, however, the US market is worth more than 10 times as much. As the UK looks to recover from the multiple shocks of Brexit, Covid-19 and its accompanying recession, digital innovation will be at the heart of its future economic success. With the importance of digital technology having particularly become more important since the pandemic, businesses are currently scrambling to come out ahead of their competitors, when it comes to realising the potential of new technologies. Amid this, new research from Strategy& suggests that the UK’s digital economy is already lightyears ahead of many of its closest rivals. Currently the countries with the largest digital economies are the US, on $771 billion, China, on $317 billion, and Japan, with $164 billion. However, while the UK is some distance from them – its digital economy is more than 10 times smaller than the US’ – there is evidence to suggest it is punching above its weight at the moment.
https://www.consultancy.uk/news/29700/uk-has-4th-largest-digital-economy-in-the-world
Financial services and whisky manufacturers boost Scottish profitability
Businesses in Scotland are reporting above average profitability compared to the UK’s national average, according to accountancy and business advisory firm BDO. A study of 220,000 UK businesses shows that Scottish businesses have average profit margins of 7.5% – above the UK’s national average of 6.7% – and second only to businesses in London that reported average profit margins of 8.1%. The profitability of businesses in Scotland is helped by its substantial financial services industry. The sector in Scotland has an average profit margin of 13.6% and employs around 87,000 people. Edinburgh is home to numerous banks, asset managers insurance companies and fintech firms. For instance, 24% of all UK life insurance employees work in Scotland, along with 13% of all those employed in banking in the UK. Scotland’s economy is also boosted by the profitability of its whisky distillers. BDO’s research shows that businesses in the country’s flagship drinks manufacturing industry reported profit margins that average 20% – one of the highest levels of profitability seen in any regional industry.
https://www.insider.co.uk/news/financial-services-whisky-manufacturers-boost-25553792
Increased flexible working could unlock £55bn for the UK economy
One of the first in-depth studies to quantify the economic benefits of flexible working projects the UK could unlock £55bn with a 50% increase in flexible working. Flexible working already contributes £37bn to the UK economy each year, according to Flexonomics: The economic and fiscal benefits of flexible working, a new economic study aiming to quantify the contribution of the working arrangement. Published by Pragmatix Advisory, and commissioned by Tier One contractor, Sir Robert McAlpine, and flexible working campaigner, Mother Pukka, the report forecasts that a 50% increase in current rates of flexible working could result in a net economic gain of £55bn, alongside the creation of 51,200 new jobs. With flexible working linked to enhanced productivity and employee morale, alongside a reduction in employee absences, the report also found that refusals to accommodate flexible working requests are costing business almost £2bn a year.
Investment in UK impact technology firms jumped to £2bn in the past year
Investment in UK impact technology firms jumped to £2 billion in the past year as the sector passed a total valuation of £50 billion, according to new data. Impact tech firms – which use technology to address issues such as climate change and global health – saw funding rise £300 million from 2020, according to data from Dealroom compiled for the UK’s Digital Economy Council. Investment in the sector was found to have increased 127% since 2018, taking the total value of the sector beyond £50 billion for the first time. Climate tech firms led the hike in investment, with green energy provider Octopus Energy raising the biggest round of the past year of £438 million, followed by electric car subscription platform Onto, which attracted £130 million in July. Firms in the climate tech sector were found to have attracted 65% of impact deals over the past year, according to the figures. The data comes as the Secretary of State for Digital, Culture, Media and Sport, Nadine Dorries, hosts the Future Tech Forum this week in London to discuss future public policy issues relating to the development and use of digital technologies.