Scotland is fast proving itself to be a global FinTech hub. In the last 10 years, the country’s FinTech market has attracted nearly £37m in investments, according to government figures.
Scotland has all the right ingredients for a strategic technology hub – innovative and ambitious start-ups, heavy-hitting international firms, leading universities and a supportive public sector.
And while Scotland’s economy might be renowned for its thriving construction sector, the tech market is forecast to be the fastest growing sector through to 2024 in terms of gross value added (38%), which is growing at twice the rate of the overall economy (17.5%).
What makes Scotland a FinTech hub?
In the grand scheme of things, FinTech is a relatively new industry - but in its short lifespan, it has revolutionised the finance sector by applying new technology to financial services, products and activities.
But with tech hubs like Silicon Valley, New York and London, why is FinTech taking off in Scotland?
Scotland is already home to some major financial players including the likes of J.P. Morgan, HSBC, Morgan Stanley, NCR, Ingenico and Avaloq.
And, as the travel fare aggregator website Skyscanner has proven, it’s also the perfect climate for the FinTech market. The online accounting business FreeAgent, and The ID Co, which helps banks make lending decisions by analysing live financial data, have also proven this point.
This is particularly true for Edinburgh. According to Deloitte’s 2017 Global FinTech Hubs Federation report, Edinburgh’s high concentration of commercial and academic innovation makes it the most complete financial and business services industry cluster in the UK outside of London and the South East.
The tech sector has a skills shortage on its hands.
Scotland is currently up against a skills shortage across the board – with 73,600 job vacancies altogether, 24% of which are classed as skill shortage vacancies, according to the most recent figures from the Employer Skills Survey.
Despite the sharp rise in FinTech investments, the sector has been particularly hard hit. On average, there are between one and five vacancies per employer in the country, but when it comes to digital roles, Digital Scotland revealed 38% of employers have vacancies in tech roles, while 82% said they found it difficult to recruit people with the right technical skills and experience.
As a result, many employers (37%) admitted to recruiting talent abroad to help fill the gaps - the demand is highest for technical level roles, with a particular shortage of software developers.
Future talent looms on the horizon.
While it might have been more than a decade since the 2007/2008 financial crisis, the lack of senior talent in the tech sector is still an apparent side effect.
To bring about a new generation of tech experts, closer ties between business and education have been forged – and initiatives like the Digital World campaign and £6.5m in government funding have helped close the gap.
But the tech sector is not out of the woods yet. Organisations looking to appoint tech talent need to be agile and versatile in their approach. Rather than relying on outdated, more traditional means of talent attraction and acquisition, organisations need to be willing to rethink their strategies, and have a clear idea of their desired outcomes.
Morgan Philips Managed Solutions are a managed services provider that specialise in placing highly skilled and experienced technology and change consultants within organisations to help them meet their imminent and long-term business objectives.
To find out more about how we can help your organisation, get in touch with our team.