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New report reveals North East technology sector needs skills boost

15 June 2016

North East technology firms are being hampered by a skills shortage in the region, according to the results of a new joint research project.

More than 400 technology companies located in the North East were asked to take part in a survey undertaken by Newcastle headquartered commercial law firm Watson Burton in partnership with the North East Chamber of Commerce (NECC). The results revealed that many companies feel that there is a skills shortage in the region, and that they are finding it difficult to recruit and retain tech talent.

The Watson Burton and NECC Tech Survey 2016 examined issues surrounding geography, infrastructure and finance, with the outcomes driving tailored seminars and workshops to help combat any barriers to growth technology companies may face.

More than half of respondents to the survey (55.8%) stated that the North East suffered a skills shortage for their company’s needs, compared to 32.6 per cent who felt that it didn’t and 11.6 per cent who answered ‘don’t know’.

Meanwhile, 39.5 per cent of respondents said that it was ‘difficult’ to recruit and retain the right employees, compared to just 11.6 per cent who said it was ‘easy’.

The companies were also asked about how the skills gap could be addressed. Nearly two thirds (65.9 per cent) of respondents suggested that specific incentives were needed to attract and retain talent in the North East, while over half (56.1 per cent) said that university or college courses tailored to industry needs were needed.

However, the research revealed that nearly 82 per cent of companies surveyed viewed the North East as a positive location to start up and develop a technology company. The region also scored highly for its infrastructure, with three quarters (75 per cent) of companies surveyed stating that the North East has the necessary infrastructure to support their business.

According to the North East Local Enterprise Partnership, North East England is home to more than 1500 software and technology companies employing 15,000 people, and the sector contributes £600 million annually to the regional economy. By 2020, it is estimated the North East will be home to 2200 software firms.

Paul Wigham, associate at Watson Burton and part of the firm’s specialist technology team, said: “It is encouraging to know that the region is popular with technology companies, demonstrating that it is very much part of the new, innovation-led economy. Our experience of working with numerous ground breaking businesses in the technology sector, such as Zerolight, Performance Horizon, Palringo and SaleCycle has demonstrated how visionary businesses can use the North East as a springboard to success.

“However, building a tech-focused skills base in the region, and nurturing and retaining talent, must be a key priority in order to ensure that the growth of this sector is not stunted and that the North East’s technology industry reaches its full potential. It is concerning that many companies feel that the right skills and individuals are in short supply and steps should be undertaken to address this.”

Jonathan Walker, head of policy and campaigns at the NECC, said: “To grow, our tech firms need access to the right talent at all skill levels. NECC wants to see a working North East. This means bringing the worlds of business and education closer together to meet future skills needs, as well as marketing our region as a great place to build a career.”

Performance Horizon is a leading provider of Software as a Service (SaaS) solutions for digital partner marketing with sites in the UK, United States, Japan and Australia. It has an office in Newcastle upon Tyne.

Chris Blaxall, CFO of Performance Horizon, said: “As a company operating all over the world, we’re proud to be part of England’s North East innovative tech hub and are fortunate to have talent on board that’s allowed us to excel in this competitive region.

“The survey is an eye opener to the talent challenges that face the region, and as an integral part of the community, we’re committed to help raise the North East’s profile for technology businesses both locally and globally.”

Watson Burton delivers commercial legal services nationwide. Its core practice areas are corporate, employment, real estate, construction and dispute resolution, and it has offices in Newcastle, Leeds and London.

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