What will 2022 hold for UK tech?
The UK’s tech sector enjoyed a record year in 2021, with start-ups and scale ups receiving a massive £29.4bn in funding, according to figures compiled by Dealroom for the Government’s Digital Economy Council. Almost a third of this funding went to firms outside of London and the South East – promising news for our regions.
This growth isn’t expected to slow down moving into 2022, so here we’ve collated five of the top trends we’ll see this year and beyond.
EdTech gets it moment
EdTech has traditionally lagged behind other technology sub-sectors when it comes to market prominence, investment and usage, but the last couple of years have – partly out of necessity – helped it shine. Latest stats value the global EdTech sector at around $270bn – a number expected to reach $404bn by 2025.
This year, we expect the growth of EdTech to continue, with a flurry of new products, services and new propositions developed. I don’t think it would be unfair to say we could see EdTech picking up the narrative and momentum that work from home technology did in 20/21.
However, a crucial challenge in 2022 for EdTech creators will be how they continue to prove its value (of which there is much) and stay prominent in front of the education sector – one that has traditionally been slower to adopt new tech – despite that fact that most are now back to face to face learning.
Another bumper year for cyber
We mentioned cyber growth in our 2021 trends piece, but it would be silly to omit simply because it’s been predicted before. The first quarter of 2021 saw three times as many ransomware attacks as the whole of 2019, according to the UK National Cyber Security Centre – hardly surprising with the prominence of hybrid and fully remote working.
To combat this, this year, even more developments will be made in cyber, with technologies such as Passwordless and AI enabled technology, that predicts attacks through identifying unusual behaviour, coming more to the fore. Also, with people now using more connected devices than ever, more security solutions targeted specifically at the Internet of Things, targeting will come to market.
Finally, we’ll increasingly see organisations assessing cyber credentials and risks before choosing who to partner with – in fact, Gartner has predicted that industry-standard security rating schemes will become as important to companies as credit rating agencies.
Robo-adviser use continues to grow
A perfect storm of increased digital adoption over the past two years, people having more time to consider how to best invest their money, plus low interest rates making traditional saving methods basically-fruitless, saw a bumper year for the use of AI-powered robo-advisors - such as Nutmeg, Wealthify and Plum - in 2021. eMarketer data predicted that in 2021 over 420,000 UK adults would use a robo-advisor to handle their investments, up by 25.2% on 2020. This follows 55.6% growth in 2020.
So, while there’s nothing particularly ‘new’ here, we predict that usage of them will continue to grow amongst the average consumer – offering an easy introduction to dipping their toes in the stock market for novice investors. We expect to see these providers adding things like tailored wealth management advice and other services at lower prices than traditional providers to their arsenal – indeed some already have. We could also see more acquisitions by larger financial services companies and banks looking to strengthen their digital offerings – see JP Morgan’s acquisition of Nutmeg in Summer 2021.
Brands eye up the Metaverse
Love it, hate it, think it’s a fad – whatever your take is, the likelihood is we’ll see some brands weighing it up. As with many ‘new’ technologies (I use ‘new’ very loosely here, as the notion of the Metaverse has been discussed for years), it’s likely we’ll see the technology adoption curve at work here, with early adopters leading the pack and other curious brands sitting back and observing before committing.
If you are a business that wants to dip its toes in, but aren’t sure where to start, this article is an interesting piece around how brands can take their first steps into the metaverse. Whether it actually takes off or not? That’s another debate entirely…
Recruitment challenges continue as tech job vacancies hit high
Tech vacancies currently make up 12% of all available jobs in the UK – a number which we’d put a good guess on steadily increasing. While we reckon we’ll see more people moving to tech roles, as they’ve seen just how important (and varied) they can be over the past couple of years, there will still be a shortfall of skills.
With this in mind, we’ll see a bigger focus on tech employers really working to build their employer brand (i.e., outwardly making themselves an attractive place to work) in order to attract talent. Naturally, we’ll also see further salary inflation and businesses adding to and driving their benefits packages forward. These inflated salaries can be killers for smaller businesses, but it’s also likely that we’ll see purpose-drive tech businesses flourish (despite their size) when it comes to securing talent, as people increasingly want to work for an employer that aligns with their values.