London has once again been named the leading tech hub globally, as revealed by the latest Z/Yen Smart Centres Index, which evaluates 79 commercial centres worldwide based on their tech prowess.
London has maintained its top position since it surpassed New York last May.
In a shake-up of the top ranks, Zurich climbed from fourth place to second, dethroning New York, which now sits in third.
Meanwhile, the historic university cities of Oxford and Cambridge have shown significant progress, moving up to fourth and fifth place, respectively.
These cities are home to some of the world’s most sought-after tech companies and research institutions.
Cambridge’s tech ecosystem has particularly shone, with a combined value reaching $191 billion (£150 billion), surpassing the total tech value of Spain and Italy combined, according to Dealroom.
Key players in Cambridge include chipmaker Arm, which has seen its shares more than double since its Nasdaq debut last September, achieving a market capitalisation of $130 billion (£102 billion).
Cybersecurity firm Darktrace is also in the spotlight, expected to join the FTSE 100 next week.
The sustained high ranking of London in Z/Yen’s index may alleviate concerns about the UK’s tech sector losing ground to EU counterparts, especially in light of recent challenges such as higher interest rates and funding constraints that have impacted investments and valuations.
Prime Minister Rishi Sunak has outlined ambitious plans to establish Britain as a “science and technology superpower” by 2030.
Last year, the UK saw a record-breaking 51,017 new tech companies incorporated, according to RSM. Highlighting this growth, Sunak recently celebrated the success of
Wayve, an autonomous driving AI start-up, which secured over $1 billion (£800 million) in funding. Originally founded in Cambridge, Wayve has since relocated to London.
However, the overall tech landscape has faced headwinds. The average rating across all centres in the Z/Yen index fell by 1.31% in the latest edition.
North American centres, excluding Seattle, experienced an average drop of 1.68%, with New York’s rating plunging by 25 points, the second largest decline after Bahrain.
Western Europe also saw a slight decrease, averaging a 0.90% drop.
Z/Yen attributes these declines to ongoing geopolitical threats and economic instability, which may be dampening confidence in global tech hubs.
Despite these challenges, a quarter of survey respondents identified artificial intelligence, digital, and computing technologies as having the most significant impact over the next five years, followed by energy and environmental tech (18%) and electronics, photonics, and quantum tech (17%).
Michael Mainelli, Lord Mayor of the City of London and Z/Yen chair, commented, “Commercial centres across the world continue to promote innovation in technology and science. Our community’s focus on artificial intelligence, electronics, and energy technology as the developments likely to have the most impact on the industry over the next five years shows the likely continued direction of travel.”
The Z/Yen Smart Centres Index is based on 135 factors from third parties, including the World Bank, OECD, and the United Nations, and incorporates 1,661 assessments from an online questionnaire, underscoring its comprehensive analysis of the global tech landscape.