National statistics

Digital Sector Economic Estimates: Regional Gross Value Added 2020

Updated 1 September 2023

1. Introduction

Release date: 19 July 2023

Next release: 2024

Geographic coverage: United Kingdom, Regions

Time coverage: 2010 to 2020

Responsible analyst: Rachel Moyce

This release provides estimates of the contribution of the Digital Sector to the UK economy from 2010 to 2020, measured by gross value added (GVA), for the UK regions. The results for 2020 are affected by the coronavirus (COVID-19) pandemic.

We use current prices to report current sector estimates and chained volume measures for any comparisons over time.

The Digital Sector was previously included in the DCMS statistics, and is now published separately alongside the DCMS statistics as responsibility for this sector now lies with the Department for Science, Innovation and Technology (DSIT).

Monthly and annual estimates of GVA for the Digital Sector are also available.

2. Regional GVA in the Digital Sector (including Telecoms)

The majority of Digital Sector GVA was generated in London and the South East in 2020, and the regional distribution has changed very little since 2010. The sector also formed a larger proportion of the local economies in London and the South East. From 2019 to 2020, during the pandemic in the UK, drops in GVA were seen in some regions, but not to the same extent as for other industries. Digital Sector GVA grew strongly in all regions from 2010 to 2020.

• Total UK GVA by the Digital Sector in 2020 was £142.3 billion, 7.5% of UK GVA.
• The majority of GVA in the Digital Sector in 2020 was generated in London (38.4%) and the South East (20.9%). London and the South East are overrepresented in Digital Sector GVA compared to the whole UK economy, where London and the South East contribute 23.9% and 15.0% of GVA respectively.
• The regional distribution of Digital Sector GVA was similar in 2010, but has become more concentrated in London since then, when the region accounted for 35.7% of Digital GVA.

Figure 1: Regional Distribution of GVA in the Digital Sector and the whole UK economy in 2020

• Another way to look at regional GVA is to consider the contribution of the Digital Sector to regional economies. The largest regional contributions to the local economy by the Digital Sector are also in London and the South East, where the sector contributed 12.0% and 10.4% of regional GVA respectively in 2020. This is a similar pattern to both 2010 and 2019, when the Digital Sector contributed 11.6% and 11.3% of the regional economy in London, and 10.8% and 9.7% in the South East.
• The Digital Sector contributed at least 4% to the regional economy in all regions in 2020.

Figure 2. Contribution of the Digital Sector to regional economies as a percentage

• GVA by the Digital Sector was less affected by the pandemic than other industries, and showed smaller falls, or growth, in all regions from 2019 to 2020.
• In the longer term, Digital Sector GVA grew in all regions from 2010 to 2020, particularly in the North East (+127.7%).

Figure 3. Index of regional growth in the Digital Sector, 2010 to 2020

2010 = 100

3. Telecoms Sector

The Telecoms Sector is wholly contained within the Digital Sector, and the majority of Telecoms GVA was generated in London and the South East in 2020. The regional distribution has changed little since 2010. Overall, Telecoms Sector GVA grew massively from 2010 to 2020, although some regions showed falls from 2019 to 2020.

• Total UK GVA by the Telecoms Sector in 2020 was £34.4 billion, 1.8% of UK GVA.
• The largest regional contributions to Telecoms GVA in 2020 were generated in London (24.2%) and the South East (22.9%).
• Compared to the regional distribution of GVA for the whole UK economy, the South East (22.9%) and North East (4.0%) contributed more to Telecoms GVA.
• The regional distribution of Telecoms GVA was similar in 2010, 2019 and 2020.

Figure 4: Regional Distribution of GVA in the Telecoms Sector and the whole UK economy in 2020

• Another way of looking at this is that the contribution of the Telecoms Sector to the regional economy in the South East and North East was higher than the contribution to the UK economy overall. The largest regional contribution to the local economy by the Cultural Sector was the South East at 2.8%, followed by the North East at 2.6% of regional GVA. This is a similar pattern to both 2010 and 2019.

Figure 5. Contribution of the Telecoms Sector to regional economies as a percentage

The following findings report the real-terms growth. All GVA figures that follow are in chained volume measures and adjusted for inflation.

• the largest changes from 2019 to 2020 were in the West Midlands (+10.2%) and the North East (-7.5%).
• In the longer term, from 2010 to 2020, Telecoms Sector GVA grew in all regions by more than 300%. The largest relative growth over this period was seen in Wales (547.9%).

Figure 6. Index of regional growth in the Telecoms Sector, 2010 to 2020

2010 = 100

4. Further information

GVA is a measure of the increase in the value of the economy due to the production of goods and services. Its relationship to GDP is as follows:

GVA = GDP + Subsidies - Taxes

GVA is measured either at:

• current basic prices (‘nominal GVA’), which give the best ‘instantaneous’ measure of the value to the economy, but are not adjusted for the effect of inflation.
• chained volume measures (‘real terms GVA’), where the effect of inflation is removed.

The accompanying data tables consist of current prices and chained volume measures for the Digital Sector from 2010 to 2020, and a GVA index expressed in chained volume measures.

We use current prices to report current sector estimates and chained volume measures for any comparisons over time.

Following changes announced in February 2023, figures for the Digital Sector and Telecoms are presented separately, as responsibility for these policy areas now sits with the Department for Science, Innovation and Technology (DSIT).

Methodological information on the sector definitions, data sources, derivation of GVA and limitations of the approach can now be found in the accompanying technical report, along with. a summary of alternative economic measures of these sectors that are published elsewhere.

The Economic Estimates: GVA (gross value added) for DCMS Sectors and the Digital Sector, 2020 are badged as National Statistics. This affirms that the statistics have met the requirements of the Code of Practice for Statistics.

DCMS has developed a suite of economic estimates to understand the economic impact its sectors have on the UK economy. In combination with other economic indicators, GVA estimates help build a comprehensive picture of the UK economy, and of the DCMS Sectors’ importance within it.

The responsible statistician for this release is Rachel Moyce. For enquiries on this release, please email evidence@dcms.gov.uk.

For general enquiries contact:

Department for Culture
Media and Sport
100 Parliament Street
London
SW1A 2BQ

For media enquiries contact: 020 7211 2210.

DCMS statisticians can also be followed on Twitter via @DCMSInsight.