Accredited official statistics

Economic Estimates: Digital Sector Regional Gross Value Added (2019 to 2022)

Updated 17 December 2024

1. Details

This publication provides estimates of the contribution of the Digital Sector to the UK economy from 2019 to 2021, and provisionally for 2022, measured by gross value added (GVA), for the UK International Territorial Level 1 (ITL1) regions. The estimates produced as part of this release are consistent with national (UK) estimates, published by the Office for National Statistics (ONS).

Although previously included in the Department for Culture, Media and Sport (DCMS) Economic Estimates series, figures for the Digital Sector and subsectors are now published separately by the Department for Science, Innovation and Technology (DSIT).

This release is intended to be used for assessing regional trends and differences. For total national GVA, including changes over time, please see the previous DCMS and digital sector GVA 2022 (provisional) publication.

DSIT are currently conducting a review of the Digital Sector Economic Estimates series and are consulting with users on potential changes. If you would like to contribute to this consultation, please do so using this link. The consultation will close at 11:59pm on 26 September.

2. Highlights

• We report that Digital Sector GVA grew in almost all ITL1 regions between 2019 and 2022, with growth rates for Digital Sector GVA higher than their respective regional growth rates for GVA across all industries, when accounting for inflation.
• The largest increases in Digital Sector GVA between 2019 and 2022 were observed in the North East (37.2%) and the South West of England (36.4%). The only decrease in Digital Sector GVA between 2019 and 2022 was in Northern Ireland (-3.4%), in contrast to the growth in Northern Ireland GVA for all industries (1.6%) over the same period.
• In 2022, London (38.5%) and the South East of England (20.4%) were the ITL1 regions contributing the most to the UK total Digital Sector GVA, contributing over half of the UK total Digital Sector GVA. Northern Ireland (1.2%) and Wales (1.8%) contributed the least to UK Digital Sector GVA in 2022. This is a continuation of a long-term trend, with regional contributions to UK total Digital Sector GVA being broadly consistent between 2010^{[footnote 1]} and 2022.
• In 2022, London and the South East were the only two ITL1 regions that had a higher share of UK total Digital Sector GVA than their respective share of UK total GVA across all industries.
• In 2022, the Digital Sector contributed approximately 7.2% of total UK GVA. In comparison, the Digital Sector contributed 11.9% of total GVA in London and 9.7% of total GVA in the South East of England. These regions saw the highest two proportions of Digital Sector GVA to their total regional GVA. In all other ITL1 regions, Digital Sector GVA contributed between 3.7% and 5.5% of total regional GVA.

3. Sectors

The estimates reported in this release cover gross value added (GVA) in the Digital Sector, its subsectors, and the UK overall.

Please see the associated technical and quality assurance report for more information on how we define the Digital Sector and its subsectors.

4. Technical note

The ‘Economic Estimates: Digital Sector Regional Gross Value Added (2019 to 2022)’ report covers GVA expressed in both: 

• Current Price GVA (i.e. ‘nominal GVA’), which gives the best ‘instantaneous’ measure of the value of the economy, but is not adjusted for inflation. These values are calculated using the Office for National Statistics (ONS) Regional Gross Value Added (Balanced) by industry dataset and ONS Annual Business Survey (ABS). We use Current Price GVA values in this report to describe current sector estimates.
• Chained Volume Measures (CVM) GVA (i.e. ‘real terms GVA’), where inflation is accounted for. These values are calculated using the Current Prices data (as above) and ONS National industry level deflators. We use CVM GVA values in this report to make comparisons over time.

In order to produce these Economic Estimates, it is necessary to define the make-up of the economy and the sectors comprising it. The Digital Sector and subsector definitions are based on the Standard Industrial Classification 2007 (SIC) codes. This allows data sources to be nationally consistent and enables international comparisons. The definition of the Digital Sector is based on the Organisation for Economic Cooperation and Development (OECD) definition of the “Information Society”. This is a combination of the OECD definition for the ‘ICT Sector’ and the “Content and Media Sector”.

The first measure of GVA, Current Price GVA, is calculated using the ONS Regional Gross Value Added (Balanced) by industry dataset, which reports GVA at the division level, i.e. 2-digit SIC code, in conjunction with the ABS dataset which reports approximate GVA at the 4-digit SIC code level. As the Digital Sector as a whole and its sub-sectors are defined at the 4-digit SIC code level, we apportion out 2-digit SIC code data from the ONS regional accounts, to the 4-digit SIC code level by using the proportions of 4-digit SIC data for approximate GVA from the ABS.

The second measure of GVA, CVM GVA, is calculated using the aforementioned Current Price GVA, in which the 4-digit Current Price GVA is deflated, aggregated into sectors and sub-sectors, and subsequently chain-linked to produce a CVM GVA series. This effectively accounts for the variation in prices over time.  In this release, as with our most recent ‘Economic Estimates: Digital Sector Monthly GVA (to March 2024)’, we have repriced the Chained Volume Measure series to 2022 prices.

Users should also note that our UK totals exclude any extra-regio activity (i.e. any economic activity which cannot be assigned to a specific ITL1 region, such as offshore activities, etc.). Therefore, our published UK totals for all industries in current prices will match the Regional Accounts’ United Kingdom minus Extra-Regio totals.

For more detailed information on the methodology, as well as its limitations, data sources, and quality assurance processes, please see the associated technical and quality assurance report.

These Accredited Official Statistics have been independently reviewed and regulated by the Office for Statistics Regulation (OSR). They comply with the standards of trustworthiness, quality and value in the Code of Practice for Statistics. Accredited Official Statistics are called National Statistics in the Statistics and Registration Service Act 2007. The accreditation of these statistics was last confirmed in June 2019 by OSR. For more detailed information on the accreditation of these statistics, please see the OSR website.

Accreditation signifies their compliance with the authority’s Code of Practice for Statistics which broadly means these statistics are:

• Managed impartially and objectively in the public interest.
• Meeting identified user needs.
• Produced according to sound methods.
• Well explained and readily accessible.

You are welcome to contact us directly at economicestimates@dsit.gov.uk with any comments about how we meet these standards.

Alternatively, you can contact OSR by emailing regulation@statistics.gov.uk or via the OSR website.

5. International Territorial Level 1 (ITL1) Regional GVA

5.1 ITL1 Regional contributions to the Digital Sector GVA

In this section, we evaluate the contribution of each ITL1 region to the UK total gross value added (GVA) for the Digital Sector, measured in Current Prices GVA. This is calculated by dividing each ITL1 regional Digital Sector GVA total by the UK total Digital Sector GVA. We use these values to assess the importance of each ITL1 region’s contribution to the UK Digital Sector as a whole.

The statistics included in this release suggest that the UK total Digital Sector GVA was approximately £160.6 billion in 2022, contributing 7.2% of the UK total GVA for all industries.

Note: This figure is slightly higher than the £158.3 billion published in DCMS and digital sector GVA 2022 (provisional). This discrepancy is due to this release using different data. Further information about this is included within the technical report.

In 2022, London and the South East of England reported  the two highest ITL1 regional Digital Sector GVA, at £61.9 billion and £32.8 billion, respectively. These two ITL1 regions together contributed over half (58.9%) of the UK total Digital Sector GVA in 2022, with London producing 38.5% and the South East producing 20.4%, as seen in Figure 1.

London and the South East of England were also the only ITL1 regions to have had a higher proportional contribution to the UK total Digital Sector GVA than their respective contributions to the UK total GVA for all industries in 2022, as seen in Figure 1. For example, London contributed just over a third (38.5%) of the UK total Digital Sector GVA compared to just under a quarter (23.3%) of the UK total GVA for all industries. Similarly, the South East contributed just over a fifth (20.4%) of the UK total Digital Sector GVA compared to just over a seventh (15.1%) of the UK total GVA for all industries, as seen in Figure 1.

Figure 1: Contribution to Digital Sector and all industries gross value added (GVA), by International Territorial Level 1 (ITL1) region, measured in Current Prices, UK, 2022.

In 2022, all ITL1 regions other than London and the South East of England contributed lower proportions to the UK total Digital Sector GVA than their respective contributions to the UK total GVA for all industries, as seen in Figure 1.

In particular, in 2022, Northern Ireland contributed 1.2% of the UK total Digital Sector GVA compared to 2.2% of the UK total GVA for all industries. Similarly, Wales contributed 1.8% of the UK total Digital Sector GVA compared to 3.3% of the UK total GVA for all industries.

Further GVA estimates for each ITL1 region and the Digital Subsectors from 2019 to 2022 can be found in the published tables.

5.2 Digital Sector GVA contribution to ITL1 regional economies

In this section, we evaluate the contribution of the Digital Sector to each ITL1 regional economy, measured in Current Prices GVA. This is calculated by dividing each ITL1 regional Digital Sector GVA by the ITL1 regional GVA for all industries. We use these values to assess the importance of the Digital Sector to each ITL1 regional economy.

Overall, in 2022, the Digital Sector contributed 7.2% of the UK total GVA for all industries.

In 2022, London and the South East of England were the ITL1 regions with the largest proportional contribution from the Digital Sector. The Digital Sector contributed 11.9% to London’s total GVA and 9.7% to the South East’s total GVA.       

Figure 2: Digital Sector contribution to total gross value added (GVA), by International Territorial Level 1 (ITL1) region, measured in Current Prices, UK, 2022.

In 2022, the Digital Sector contributed the least to GVA in Northern Ireland and Wales (3.7% and 3.8% respectively).

Further GVA estimates for each ITL1 region and the Digital Subsectors from 2019 to 2022 can be found in the published tables.

5.3 Annual trends in ITL1 regional Digital Sector GVA

In this section, we evaluate the annual trends in GVA  produced by the Digital Sector in each ITL1 regional economy, measured in Chained Volume Measures GVA. This allows us to look at the percentage change each year, from 2019 to 2022, after removing the effects of inflation. We use these values to assess the changes in the Digital Sector over time.

Between 2019 and 2022, the majority of ITL1 regions saw an increase in total Digital Sector GVA, with this increase generally being higher than the ITL1 regional total GVA for all industries, as seen in Figure 3.

The highest increases in ITL1 regional total Digital Sector GVA between 2019 and 2022 were seen in the North East of England (37.2%) and the South West of England (36.4%), when accounting for inflation. These ITL1 regions’ total Digital Sector GVA increased by more than their respective ITL1 regional total GVA for all industries, which increased by only 2.0% in the North East of England and 5.2% in the South West of England over the same time period.

Between 2019 and 2022, the only decrease in ITL1 regional total Digital Sector GVA was in Northern Ireland (-3.4%), when accounting for inflation. This is in contrast with the GVA across all industries in Northern Ireland, which increased by 1.6% across the same period, as shown in Figure 3. For all other ITL1 regions, Digital Sector GVA growth was higher than GVA growth across all industries between 2019 and 2022.

Figure 3: Percentage change (%) in Digital Sector gross value added (GVA) since 2019, measured in Chain Volume Measures, by International Territorial Level 1 (ITL1) region, UK, 2019 to 2022.

Notes:

1. Values are calculated from a baseline level of GVA for each ITL1 region for 2019, in which 2019 for each region is equal to 0% to allow for comparability between ITL1 regions.

Between 2021 and 2022, the majority of ITL1 regions saw an increase in their respective Digital Sector GVA. The highest increases in Digital Sector GVA between 2021 and 2022 were seen in the North East of England and London, increasing by 11.5% and 9.4% in real terms, respectively. These ITL1 regions saw their Digital Sector GVA increase by more than their respective GVA for all industries between 2021 and 2022 (5.0% in the North East of England and 4.8% in London).

Between 2021 and 2022, the only decreases in ITL1 regional Digital Sector GVA were found in the East Midlands (-1.3%) and Yorkshire and the Humber (-0.3%), when accounting for inflation. In comparison, between 2021 and 2022, GVA for all industries increased by 1.7% in the East Midlands and 4.1% in Yorkshire and the Humber.

Further GVA estimates for each ITL1 region and the Digital Subsectors from 2019 to 2022 can be found in the published tables.

6. References

DCMS and the Digital Sector Economic Estimates: Regional GVA, Department for Culture, Media and Sport, Last Updated: 1 September 2023

Annual Business Survey Quality and Methodology Information, Office for National Statistics (ONS), Published: 9 January 2024

Code of Practice for Statistics, UK Statistics Authority / Office for Statistics Regulation, Last Updated: 5 May 2022

DCMS and Digital Sectors Economic Estimates, Department for Culture, Media and Sport, Last Updated: 27 June 2024

DCMS and digital sector GVA 2022 (provisional), Department for Culture, Media and Sport, Published: 15 February 2024

Economic Estimates: Digital Sector Monthly GVA (to March 2024), Department for Science, Innovation and Technology, Published: 23 June 2024

OECD Guide to Measuring the Information Society 2011, The Organisation for Economic Cooperation and Development, Published: 26 July 2011, Paris, https://doi.org/10.1787/9789264113541-en

Statistics and Registration Service Act 2007, UK Government, Published: 26 July 2007

UK SIC 2007, Office for National Statistics, Last Updated: 24 January 2024

1. Data prior to 2019 taken from DCMS’s previous publication - DCMS and the Digital Sector Economic Estimates: Regional GVA ↩