- Optimism remains high for the majority of Scottish businesses with AI and machine learning (ML) among key areas of growth
- ScotlandIS plans closer ties with policymakers and government officials to address growth and cash flow concerns
- The report is supported by Techscaler, a Scottish Government programme run by CodeBase, designed for creating, developing and scaling tech startups.
The outlook for the Scottish tech sector remains positive according to the latest industry report from ScotlandIS, the membership and cluster management organisation for Scotland’s digital technologies industry.
Despite a challenging economic and geopolitical climate, almost three quarters (73%) of firms expressed optimism for the year ahead, a feeling driven by expectations of growth and the promise of new opportunities for the sector. While a slight decline from last year’s 78% optimism, the figure remains high, reflecting an overall positive outlook for the next 12 months.
Perhaps unsurprisingly, the biggest expected growth area for 2025 is in AI and machine learning (ML). The expansion of this technology subsector has continued steadily, going from 62% of firms expecting to see new opportunities in the sector in 2024 to 69% in 2025. Predictably, the demand for skills in AI and ML also increased, with 70% of businesses anticipating a requirement for skills in this area.
While the majority of respondents reported a positive outlook for 2025, some smaller businesses anticipate challenges when it comes to growth, with 16% of firms indicating cash flow was substantially more difficult in 2024 – an increase from 3% in 2023.
In response to the survey results, ScotlandIS plans to form even closer ties with policymakers, industry bodies and educational providers to address these growth challenges and help businesses scale effectively.
Karen Meechan, CEO at ScotlandIS said: “There’s a lot to be excited about in the Scottish tech sector right now. For example, the UK government’s increased focus on AI, has driven huge growth for our industry in that area. This is reflected by some encouraging responses to our survey and it’s great to see a strong sense of optimism continue as we progress further into 2025. With the ongoing geopolitical and economic challenges, the fact we’ve seen some slight softening when compared directly with last year’s results is hardly surprising. Seeing the Scottish tech sector remain so positive, even in the middle of a very tough climate for businesses, is testament to how resilient our industry really is.
“Given what our members are telling us, it’s important we don’t forget about the bigger picture. Like a healthy ecosystem, our sector needs support in order to thrive. Over the last year, we have shared over 400 opportunities with our members to support them entering new markets, building strategic partnerships and accessing the talent essential for growth. Looking at the year ahead, we will continue to back up our members, working closely with governments and policymakers to show just how valuable our tech sector really is.”
Stephen Coleman, CEO and Co-Founder of CodeBase said: The global technology landscape is evolving at an increasingly rapid pace, with advances in AI and a shifting investment landscape creating both challenges and opportunities. As this report shows, these macro movements are being felt in Scotland. The issues are complex and multi-faceted, but Scotland has assets, talent and infrastructure which can collectively create a strong tech economy. Techscaler is a vital part of that infrastructure; supported by many great partners like ScotlandIS, we are working to help create more startups, and supporting the increasing numbers of scaleups to help them achieve their high growth potential. This survey is a valuable tool as we collectively navigate towards a better future for Scotland.
The full report can be downloaded here.