Record jump in IT professionals engaged in R&D activity
The number of UK IT professionals engaged in cutting-edge innovation has hit record levels as software developers ramp up investment, according to an analysis by SJD Accountancy, the UK’s leading accountancy service providers to IT contractors.
The number of UK-based IT professionals engaged in research and development (R&D) activity jumped by 12.5%, from 24,000 to 27,000 over the past year, the biggest increase since the global financial crisis.
The UK software industry now has more professionals engaged in innovative activity than any other sector of the economy and has eclipsed the once dominant pharmaceuticals industry, which has 23,000 scientists and engineers engaged in R&D.
The UK software sector is now spending over £2 billion per annum on R&D, a 7.1% jump from £1.89 billion the previous year.
According to SJD Accountancy, the record number of IT professionals in the software sector engaged in R&D activity is a clear indication that software developers are investing in new products and services having scaled back expenditure during the recession.
Derek Kelly, CEO of SJD Accountancy, comments: “The huge influx of IT professionals in R&D roles is a clear indication that, having scaled back innovation during the recession, the UK software sector is ramping up investment in new products and services. With the software sector having pulled ahead of the pharmaceutical industry as the largest R&D employer in the UK, ensuring the right supply of skills is more critical now than ever.
“Our research shows that joblessness among IT contractors has more than halved over the past year. Software engineers are in notably strong demand, and candidates with experience in big data and mobile technologies are particularly sought after.”
He adds: “The burgeoning UK tech sector is dependent on being able to access the right mix of skills. With tech businesses ramping up R&D spend and deploying more talent in product development, skills shortages are intensifying. Ultimately, a shortage of talent will act as a break on innovation and with the number of students starting ICT apprenticeships having fallen for the third consecutive year, this is a growing concern.”
SJD Accountancy points out that almost seven in 10 tech businesses have reported that hard-to-fill IT vacancies caused “a delay in developing new products or services”. Half said it meant losing business or orders to competitors.
SJD Accountancy says that demand for software development skills is pushing up pay, which is in turn making it increasingly difficult for developers, many of whom are SMEs, to fund innovation.
Kelly concludes: “Of the £2 billion the UK software sector spent on R&D, over £1.2 billion was directly related to staffing costs. Skills shortages, which lead to bidding wars for talent, therefore have a direct impact on the ability of the UK software industry to innovate and compete globally.”
“The risk for the UK is that valuable R&D activity will increasingly be outsourced to low-cost overseas locations, such as Poland, if the right skills at the right price are not available in this country.”
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