Growth Verticals
l Financial and Business Services sector: Largest sector contributing to about 20% of the GDP. UK houses the third largest stock exchange in the world and is the leading financial center of Europe. The financial services segment alone employs over a million people and accounts for over 5% of the GDP. Is now leading Europe’s moves towards outsourcing software to India. Stepping stone to the continent and to the American market.

l Communications Sector: Has one of the most liberalized telecom markets in the world. Vodafone—the world’s largest cellular services company based out of here. Market however suffers form over investment and falling prices. Has also been hit the huge 3G license fees that operators had to pay up though the first 3G network is expected to go live this December.

l Manufacturing: Accounts for 20% of the national output, though growth rates are slowing down as in the rest of the developed world. A substantial chunk of government policies now aimed at pushing this sector including tax rebates and law reform.

SWOT
l Strengths: The second largest IT market in Europe after Germany accounting for 20.3% of the European pie. Very open to outsourcing and currently accounts for over 11% of all Indian software export revenues.

l Weaknesses: IT and Telecom market very significantly hit by the post Y2K slump, the dot-com burst and the downturn. Hardware prices on the downslide, services market growth down to half and telecom sector suffering from over-investment.

l Opportunities: Ad hoc projects have hit a breaker but companies now looking more for operational management and total outsourcing deals with low-cost centers like India. Also, large government commitment to e-initiatives including the UK e-government policy. Public sector IT spend increasing 2.5 times the rate of the rest of the UK IT services market.

l Threats: Growing local concern and trade union discomfort with outsourcing seen as a threat to British jobs. Early signs of a visa clampdown. Could get worse of the downturn lasts much longer.

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