Big growth for North England IT sector

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The IT industry in the North of England has growth by 64 per cent over five years, compared to just 20 per cent in London, according to data from the Office for National Statistics.

The data, released by staffing firm ReThink Recruitment, showed that while the sector is smaller up North, it is trying to catch up, growing from £4.7 billion five years ago to £7.7 billion. In London, the sector grew from £11.2 billion to £13.4 billion over the same period.

Andy Lord, director of ReThink Recruitment's Manchester office, said this was partially because setting up operations is cheaper in the North. "It is much more cost effective for organisations to be based in the North. It makes sense for everything from premises, car parks, staff wages and support services. This has led not only to new businesses establishing their offices in the North, but also bigger London businesses establishing branches."

It's not just office space that's cheaper up North, but salaries, too as the smaller demand helps keep them lower, Lord claimed.

Cost savings isn't the only reason; regeneration has helped, too. "The North has generally been flourishing in the recent years, generating growth in all areas. More and more people are moving into the city centre, which gives businesses the confidence that there is an abundance of qualified professionals to choose from and efficient support services," said Lord.

While both the North and London saw growth, the East of England's IT sector has fallen back by three per cent. Lord said this was surprising: "You would expect that research and development conducted at the University of Cambridge, as well as the constant flow of bright graduates, would attract the IT industry to the area."

He suggested high housing costs and the draw of London's creative industries as possible explanations.

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