UK Tech Sector Monthly Monitor – October 2026 update

In this Growth Commission paper in May 2026, Growth Commissioner Douglas McWilliams set out the critical contribution to the economy of the UK’s tech sector. Following the publication today of the UK GDP figures for the three months to August 2026, he observes:

“Latest GDP data shows that not only is the growth from the tech sector accelerating, but that its contribution to total UK GDP growth is growing.

“Production data shows that growth in Section J (information and communications) over the previous twelve months has kept increasing from 4.4% in the year to the three months ending in May to 5.0% in the equivalent period to June; 5.5% in the period to July and now 6.6% in the period to August 2026.

“Meanwhile turnover growth in the tech-enabled sector – a much wider part of the service sector – in nominal terms rose 9.7% in the year to the three months ending in August 2026, up from the 8.1% estimated a month ago for the period to July 2026.

“The ONS attributes nearly half the 0.7% GDP growth in the three months to August to the tech sector.

“UK venture capital firms raised an estimated $6.4bn in Q3 2026 across 31 new funds, with the UK attracting 35% of all European investment so far this year. Much of this appears to be AI-based which seems to be driving the strong growth in the sector.

“This sector would be at risk if the UK were to revert to the EU Single Market because of the negative impact of EU legislation since the UK left the EU – in particular the Digital Markets Act, the Digital Services Act and the AI Act.”