- 888,000 in the IT and Telecoms industry, such as people in IT companies (including IT services, technology-orientated consulting, technology development, systems analysis, programming, systems testing and technology sales) and Telecoms companies
- 588,000 IT or Telecoms professionals working in other sectors, such as people whose primary job role is IT orientated, which includes IT departments and IT support staff in companies
This makes up 5% of the total UK workforce. Major employers of IT professionals outside the IT industry include: financial services (17%), public sector (including education and health)(13%) and manufacturing (13%).
The UK’s IT and Telecoms industries produced an annual Gross Value Added (GVA) of £51.9 billion, which is over 5% of the total UK economy. IT intensive industries represent 55% of the total UK GVA.
There are approximately 105,000 enterprises in the UK offering IT and Telecom products and services. 92% of these enterprises are IT and 8% are Telecoms. 44% of enterprises are located in London and the South East. The IT industry has an annual turnover of over £57,000 million. 86% of businesses employ 4 people or less, compared with 67% across all sectors in the UK. Only 2% of businesses employ 50 people or more. 44% of companies have been operating for more than 10 years.
Source: e-skills UK AACS LMI 2009, Technology Counts 2008 and Profiles of the Industry and the Workforce 2008
There are 100,930 IT manufacturing and services establishments in the UK employing over 600,000 people. 45% of the workforce work outside of the sector. The IT workforce accounts for 4% of the UK workforce. IT services and manufacturing industries are predominately based in London and the South East.
The number of people employed in the sector and those employed in IT occupations are predicted to increase by 2.5%, compared to 0.5% for the UK workforce. Across England, IT is predicted to grow at 2.54%. Employment growth in the IT industry varies from 3.3% in London to 2% in the North East and South East of England. Males in the IT industry outnumber females by nearly 4:1 representing a fall of 26,000 males and a fall of 42,000 females between 2001 and 2008.
Over the next decade, the IT workforce is forecast to grow and it is predicted that there will be a need for 141,300 new entrants into IT and Telecoms professional occupations per year to 2012. This growth is driven by IT services such as consulting and outsourcing (the transfer of IT functions to an external service provider). Growth in employment is due to:
- the creation of new jobs mainly within the IT industry
- replacement of members of the IT workforce leaving employment
- changes in job types within the IT workforce, such as geo-sourcing (the transfer of IT work and functions to across the world), increase in IT services and more ‘client-facing’ roles
- changing dynamics of IT professions within the IT industry and IT professionals working outside the IT industry
Between 2007 and 2012, it is estimated that UK firms will need to fill around 180,000 ICT professional positions each year. Of these ICT job opportunities, 87% (approximately 157,000) will be ‘replacement’ positions and 13% (approximately 23,000) will be ‘new’ posts resulting from an overall expansion/growth of the ICT professional workforce. Around 2 in 10 of these opportunities will be filled by those changing jobs in the sector.
Source: e-skills UK AACS LMI 2009, Technology Counts 2008, IT & Telecoms Insights 2008 and Women in IT Scorecard 2008
The Telecoms sector is one of the fastest changing in the UK as new technologies are being explored and developed. Migration from voice telephony to broadband data networks carry high volumes of multimedia traffic which means that boundaries between Telecoms and IT are blurring. Job roles are diverse, ranging from sales and customer-facing roles to those that are highly technical. Good communication and problem-solving skills are required as well as specialised knowledge.
Telecoms is defined here as ‘telecoms manufacturing’ and ‘telecoms services’. This includes those working in a telecoms company from drivers and IT staff to telecoms staff. There are 8,530 telecoms manufacturing and services establishments in the UK employing 301,000 people, including 235,000 (78%) who are not Telecoms professionals. 41% of Telecoms professionals work outside of the industry. The Telecoms workforce accounts for 1% of the UK workforce. This workforce is predominately male working on a full-time basis. Telecoms services and manufacturing industries are predominately based in London and the South East.
Numbers working in the Telecoms industry declined from a peak in 2001, but telecoms services employment has recently increased. The demand for telecoms professionals is also on the increase, as it is for IT professionals. There is increased demand for network controllers/administrators and software communication engineers. The Telecoms industry will grow at a slower rate compared to the IT industry at a rate of 0.3% per year. However, in the North East employment is expected to grow at a higher rate than the IT industry.
The number of ICT related skills shortages is on the increase. Skills shortages were most commonly reported for firms recruiting to fill positions in support/maintenance, systems/software design/development and ICT management. Five of the most frequently requested communications and network skills requested are: Exchange; Cisco; Firewall; WAN; and ASP. However, the demand for these skills has reduced slightly over the last year. Increased demand for Apache skills has been recorded.
The average gross weekly pay for the Telecoms industry workforce is £620, above the average for the wider economy (just over £500).
Telecoms apprenticeships are a route to employment in the industry for young people. Major employers in the industry, such as BT, Orange and O2, report that apprenticeships are an integral part of their workforce development.
Source: Technology Counts 2008, Profiles of the Industry and Workforce 2008, IT & Telecoms Insights 2008 and Telecoms Bulletin (Quarter 3, 2008)
The application of, and dependence on, IT has been ubiquitous in the UK, with a high proportion of people in employment using IT at work. It is a customer services orientated sector offering support for both hardware and software, and the design, implementation and maintenance of systems. Some industries are more IT-intensive than others. The IT industry is driven by services such as consulting and outsourcing (the transfer of IT functions to an external service provider) which is expected to grow by 2.5% each year to 2012.
The UK is a competitive world leader in IT, but in terms of businesses’ use of IT, it is behind the USA, Germany and Sweden.
The importance of IT in the UK is represented by the fact that 60% of all IT professionals working in the UK are employed in business sectors other than IT.
Sources: e-skills UK AACS LMI 2009, Trends and UK Skills Implications 2008, Employer Skills Needs 2008 and e-skills UK website 2009
On average, there is a need for 141,300 new entrants per year into IT & Telecoms professional jobs. It is estimated that:
- 70,900 people a year will be coming from occupations other than IT or Telecoms so will have retrained
- 26,800 from education, predominately graduate level and higher
- 43,000 from other sources, such as those re-entering the workforce after a career break, retirement or a period of unemployment
Current hard-to-fill vacancies are concentrated in areas such as business analysts, web support, IT architects and IT security specialists. In the UK, 22% of establishments are having difficulties filling vacancies for IT and Telecoms professionals with the right skills. In 2008, 20% of IT and Telecoms firms were recruiting. There were around 116,000 IT and Telecoms job adverts.
Employers have a strong preference to recruit experienced people, with less than 1% of those employed in the sector under 18 years.
- 18% of employers in the sector report vacancies, which is the same as all sectors
- 6% report hard-to-fill vacancies, compared to 7% in all sectors
- in total there are around 7,320 hard-to-fill vacancies reported, which is 1.1% of employment in the sector
- 5% report skill shortage vacancies, which is the same as all sectors
- the highest proportion of skills shortage vacancies are for Professionals
- 13% of establishments report skills gaps, compared to 15% in all sectors
Skills gaps are highest for sales and customer services occupations (48% compared to 23% across all sectors). Gaps are reported to be for technical and practical skills, team-working and customer-handling. However, higher than average skills gaps were reported for IT professional skills and foreign languages.
The impact of hard-to-fill vacancies is reported to be increased workload for others and a delay in developing new products and services.
Source: e-skills UK AACS LMI 2009, Employment Forecasts 2008 and National Employer Skills Survey 2007
Research shows that investment in computers and software by firms, ICT and internet use by employees, and e-commerce activity, are associated with higher value added per worker. The development of existing skills is essential to increase productivity in the UK industry. Employers believe that their employees require additional IT skills. For those wishing to enter the sector, ‘softer skills’ considered important by employers include:
- written and verbal communication
- problem solving
- creativity and the potential to generate ideas
- commercial awareness and understanding of the sector and its employers
Skills shortages are thought to be the biggest constraint on the growth and development of the sector. 16% of businesses seeking to recruit ICT staff report ICT related skills shortages. Future skills shortages are expected to be in systems integration, networking and business analysis. There is an increasing need for networking specialists and demands for individuals with systems integration competencies. Specific skills demands and attributes relevant for IT and Telecoms occupations include:
- motivation to succeed within a career in IT
- willingness to learn and apply that learning in the workplace
- ability to demonstrate that they have the potential to complete the qualifications which are part of the Apprenticeship programme
- willingness to communicate effectively with a range of people
- enjoy being part of a team
- problem solving
- organisational skills and can work within deadlines can work logically and methodically
Skills gaps are thought to include: 70% technical skills; 30% business skills; and 31% interpersonal skills. 81% of IT & Telecoms companies reporting skills gaps have an impact on their business. There is an increasing demand for applicants with HTML skills.
Employers are in great need of high-skilled IT and broadband-related skills, combined with broader business skills, and there is a strong demand for IT professionals with expertise in specialised telecommunications technologies (especially wireless networks and radio frequency engineers). Project management, IT architecture skills and solution analyst skills are in short supply. These skills will continue to be essential in the future. Emerging skill requirements for IT professionals include:
- increasing awareness of business environments
- increasing awareness of social sciences
- application of information analysis and its taxonomy
- applications of ethics and interpretation of legal aspects
- complex programme and applications portfolio management
- establishing and managing new models of IT governance, with increasingly international, devolved and outsourced characteristics
Future skill needs will be driven by the growth in the electronic communications network, mobile computing and the speed of work processes. Future skills development will need to combine vocational, work-based and academic learning. However, the difficulty of releasing employees from work, especially for small firms must be understood and taken into account.
Source: e-skills UK AACS LMI 2009, Technology Counts 2008, e-skills Bulletin Q2.09, Trends and UK Skills Implications 2008 and Assessment of Current Provision 2008
For more information on e-skills UK 2009-2014 strategic plans go to the e-skills website.
At present, the IT sector is expected to continue increase driven by e-business, e-government, e-learning and extensive electronic communication networks. There is a predicted trend for IT to become more ubiquitous in the future.
Future demand for IT skills will be shaped by emerging trends including:
- the impact of globalisation
- the importance of technology-enabled business transformation
- the pressure for constant innovation in technology-intensive products and services
- increased standardisation and industrialisation of IT
- convergence of platforms, devices and services and their impact on markets and business models
- environmental concerns and the desire for ‘green IT’
- the rise of social computing and Web2.0 and increased power to the consumer to determine content and services
- the impact of the new generation of digital natives and the expectations they bring to the workplace and the market
Many traditional entry level and software development jobs are increasingly being located off shore. In the UK, IT roles are increasingly focused on the application of technology to improve business performance. Skills such as relationship management, business process analysis and design, project and programme management, business change management, systems architecture, networking, risk management and security will grow in importance. Web and internet specialist skills will be increasingly in demand, as well as skills to manage outsourced work such as partner and contract management skills. In general, IT and Telecoms professionals will increasingly be expected to be multi-skilled, with sophisticated business and interpersonal skills as well as technical competence.
Sources: e-skills UK AACS LMI 2009 and Technology Counts 2008