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Is creativity everywhere? The geography of the UK’s creative and high-tech economies

The UK’s economic future depends on the performance of its creative and high-tech economies. These are sectors where the UK is recognised as a world leader. They are innovative, fast growing, and offer jobs that are less likely to be automated, providing sustainable future employment.

Our new report on the geography of the UK’s creative and high-tech economies, co-authored with Alan Freeman and Peter Higgs, is the first systematic analysis of employment in these two crucial parts of the UK’s economy. It covers their size, segmentation, growth and geographic distribution around the country. It shows that they are large and rapidly expanding employers, with creative economy employment growing particularly swiftly. A summary of the research is available.

The report uses the official Department for Culture, Media & Sport (DCMS) classification of the creative industries, which were in turn developed from the key insight of our 2013 Dynamic Mapping report, namely that what distinguishes the creative industries from others is that they specialise in employing people who are highly creative in their work (that is, an unusually high percentage of their workforce are employed in creative occupations).[1] To analyse the high-tech economy on a comparable basis, the report develops an equivalent classification for high-tech industries based on those industries that have high proportions of their workforce in Science Technology, Engineering and Mathematics (STEM) occupations.

Major and fast growing sources of jobs

The report finds that there were:

  • 2.6 million jobs in the UK’s creative economy in 2013, consisting of 1.7 million jobs in the creative industries (890,000 in creative occupations and 818,000 working in other roles) and 907,000 jobs in creative occupations outside of the creative industries.
  • 3.2 million jobs in the UK’s high–tech economy in 2013. 2.4 million of which were jobs in high–tech industries (825,000 in STEM occupations and 1.6 million in other roles) and 806,000 jobs in STEM occupations outside of the high–tech industries.

Creative economy employment grew on average over three times faster than the workforce as a whole (4.3 per cent per annum (p.a.) vs (1.2 per cent p.a.) between 2011 and 2013. Employment in the creative industries grew faster still, at over four times the rate of the workforce. High–tech economy employment also grew faster than the workforce over this period (2.1 per cent p.a), although not as fast as employment in the creative economy.

Creative digital industries – where the creative and high-tech economies meet

Those jobs straddling both the high–tech and creative economies have grown exceptionally quickly in recent years, at 8.0 per cent p.a. on average, over six times faster than the workforce as a whole between 2011 and 2013.[2]

Within this, three Information and Communication Technology–related industries (computer programming, computer consultancy and other software publishing) at the intersection of the creative and high–tech economies grew faster still, with employment growing at 9.6 per cent p.a.

An enduring insight of Labour’s Chris Smith in 1998 was the quintessentially creative nature of ICT-related industries such as these. What’s more, our Dynamic Mapping study documented in some detail the symbiotic role that content and digital technology play in today’s creative industries more generally.  In response to critics that ICT is not the same as creativity[3] we’d point out that the official creative industries classifications we adopt in our report include only 4 of the 12 official industry codes that represent ICT.

Putting creativity and high-tech on the map

Our research shows that the UK’s creative economy is more unevenly distributed across the country than the high–tech economy. In particular, London and the South East of England account for 43 per cent of employment in the UK’s creative economy, but only 28 per cent of the workforce as a whole. By contrast, London and the South-East account for 31 per cent of employment in the high-tech economy. In fact, it turns out that the creative industries are one of the UK’s most geographically imbalanced sectors, after finance & insurance and agriculture.

Actually, that the creative economy is so prominent in London and its surrounding areas should not be so surprising. London, as Western Europe’s largest city, is a natural hub for content producers and creative services businesses. Creative talent is drawn to all the attractions a global city like London has to offer (including, importantly, its cultural offer). The size of London’s large labour market also facilitates the knowledge sharing and informal networking that is such a strong feature of all creative activity.

That being said, despite London’s prominence, our research highlights the vibrancy of the creative economy in other parts of the UK too. In fact, it is outside the capital that employment in the creative economy has been growing the fastest between 2011 and 2013: the regions with the fastest rate of growth of creative economy employment in this period were the East of England, the West Midlands, the North East and Yorkshire & Humberside. In terms of concentration and levels of creative economy employment, the report shows that there are a number of important hotspots of creative activity outside London and the South East, in cities like Edinburgh, Glasgow, Manchester,  Bristol and Cardiff to name but a few.

Investing in the UK's creative economy

Given the continued high growth potential of the UK’s creative economy, its uneven geography is an obvious area of concern to policymakers charged with promoting growth across the whole nation. As a result, we have previously argued, targeted competitive funds should be set up to develop creative clusters across the UK.[4] In England, for example, a new fund of £100 million should be set up using Regional Growth Fund money to grow creative clusters, building on existing local strengths and meeting local needs. These should be complemented by a further £100 million of demonstrator funds aimed at prioritising the uptake of ultra-fast broadband technologies in these clusters.

As the Secretary of State for Culture, Sajid Javid, observed at the Creative England Live event at the Oxo Tower earlier this week, “the whole country is buzzing with creativity”. There is an important role for policymakers to help make sure it stays that way.

 


[1] Bakhshi, H., Freeman, A. and Higgs, P. (2013), ‘A Dynamic Mapping of the UK’s Creative Industries.’ London: Nesta.

[2] There are four occupations that are both STEM and creative: Information technology and telecommunications directors (1136); IT business analysts, architects and systems designers (2135); Programmers and software development professional (2136), and Web design and development professionals (2137). The three industry codes that are both creative and high-tech are: Other software publishing (5829); Computer programming activities (6201) Computer consultancy activities (6202).

[3] McDermott, J. (2013), ‘Creative accounting by the boosters of the creative industries’, Financial Times, January 2015.

[4] Bakhshi, H., Davies, J., Mateos-Garcia, J. and Windsor, G. (2015), ‘A £200 million programme to develop the UK's Creative Clusters‘, Nesta blog.

Author

Hasan Bakhshi

Hasan Bakhshi

Hasan Bakhshi

Executive Director, Creative Economy and Data Analytics

Hasan leads Nesta's creative and digital economy policy and research.

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John Davies

John Davies

John Davies

Economic Research Fellow, Creative and Digital Economy

John is a research fellow focusing on the digital and creative economy. He is interested in the interface of economics, digital technology and data.

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