Introduction: Why the UK Cyber Security Sector Matters
Cyber security is no longer a “support function” but a pillar of the digital economy. As businesses, government agencies, and citizens rely heavily on digital platforms, the demand for secure, trusted systems has never been greater.
The Cyber Security Sectoral Analysis 2025, released in March 2025 by the UK Department for Science, Innovation and Technology, provides a deep dive into the industry’s current state, its trajectory, and the policy initiatives that will guide its growth.
This report builds on previous editions (2018, 2020–2024) and offers critical insights into:
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Revenue and economic impact
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Workforce and skills trends
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Business growth and investment
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Emerging sub-sectors such as AI and software security
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Government’s action plan for the future
Sector Growth: Bigger, Stronger, Faster
According to the report, the UK cyber security sector in 2024 achieved:
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£13.2 billion in revenue – up 12% year-on-year.
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67,300 employees (FTEs) – an 11% increase, adding ~6,600 jobs.
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2,165 firms – a 3.5% increase, with 74 new companies.
These numbers demonstrate the sector’s resilience despite global uncertainties, showing cyber security is not just expanding but becoming a cornerstone of the UK economy.
Productivity and Value to the Economy
A standout finding is the sector’s productivity leap:
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Gross Value Added (GVA): £7.8 billion, representing a 21% increase from the previous year.
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GVA per employee: £116,200, up 8% compared to 2023.
This indicates that not only is the workforce growing, but each individual employee is contributing more to the economy — a sign of increasing efficiency, better technology adoption, and higher-value services.
Investment Landscape: Fuel for Innovation
In 2024, UK cyber firms secured:
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£206 million in funding, across 59 investment deals.
While the investment numbers are slightly lower than the record highs of previous years, they still show strong investor confidence in cyber innovation, particularly in areas like artificial intelligence, software security, and next-gen threat prevention.
Spotlight on Emerging Sub-Sectors
Cyber Security for Artificial Intelligence (AI)
As AI adoption accelerates, securing these systems becomes critical. The report highlights:
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14 specialist firms focusing exclusively on AI security, generating £68.6 million in revenue and employing around 277 FTEs.
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In the wider ecosystem (~66 firms), 9,740 roles are linked to AI security, though many are hybrid roles not fully dedicated to cyber.
This shows the nascent but fast-growing nature of AI-focused cyber security, which is likely to become one of the hottest subfields in the next 3–5 years.
Software Security
The backbone of digital infrastructure is software — and its security determines resilience. Findings include:
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93 specialist firms in software security, employing 14,581 FTEs (with ~7,960 roles directly in cyber).
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The broader ecosystem (~867 firms) employs 19,940 cyber security roles, accounting for 30% of the entire UK cyber workforce.
Software security clearly represents the largest share of employment in the sector, highlighting its importance in safeguarding every digital service.
Regional and Business Distribution
Although London continues to dominate as the hub for cyber firms, the report notes strong growth in regional clusters such as:
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Manchester and the North West (AI, fintech, and cyber start-ups).
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Cambridge (research-driven software and security innovation).
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Bristol & South West (defence and aerospace cyber specialisms).
The mix of SMEs and large enterprises is also crucial. While larger companies generate significant revenue, the SME sector drives innovation, agility, and niche expertise.
Policy Context: The Cyber Security Growth Action Plan
To ensure sustained growth, the government has launched the Cyber Security Growth Action Plan (2025). Key points:
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Led by the University of Bristol and Imperial College London, with strong industry collaboration.
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Focuses on scaling businesses, supporting exports, and closing the skills gap.
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Aligned with the refreshed National Cyber Strategy, ensuring that economic growth and national security goals go hand-in-hand.
This shows the government’s dual commitment:
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Position the UK as a global leader in cyber security innovation.
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Ensure businesses and citizens remain protected against evolving threats.
Skills and Workforce Development
The report also sheds light on the skills pipeline challenge:
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While the workforce grew to 67,300, there is still a shortage of highly specialised cyber professionals.
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Roles in AI security, penetration testing, cloud security, and advanced threat detection remain particularly hard to fill.
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Partnerships between universities, training providers, and industry are key to addressing this shortage.
Future Outlook
Looking ahead, the UK cyber security sector is expected to:
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Continue double-digit revenue growth driven by demand in AI, software security, and cloud-native solutions.
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Benefit from policy-driven investment, especially in R&D and academic collaboration.
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Face intense global competition, especially from US, Israel, and EU cyber markets.
However, with its strong foundation, skilled workforce, and government support, the UK is well-positioned to remain at the forefront of the global cyber security industry.
Summary of Key Metrics
| Indicator | 2024 Value | Year-on-Year Change |
|---|---|---|
| Revenue | £13.2 billion | +12% |
| Employment (FTEs) | 67,300 | +11% |
| Number of Firms | 2,165 | +3.5% |
| Gross Value Added (GVA) | £7.8 billion | +21% |
| GVA per Employee | £116,200 | +8% |
| Investment Raised | £206 million (59 deals) | — |
| AI Cyber Security (specialists) | £68.6 million revenue | — |
| Software Security (specialists) | 14,581 FTEs | — |
Final Thoughts
The Cyber Security Sectoral Analysis 2025 paints a picture of a thriving, resilient, and rapidly evolving industry. Its significance extends far beyond economics — it underpins national security, business confidence, and public trust in the digital world.
By investing in skills, innovation, and regional development, and by embracing new subfields like AI and software security, the UK is cementing its role as a global leader in cyber resilience.
Credits: All information sourced from the official UK Government publication: Cyber Security Sectoral Analysis 2025 – GOV.UK.
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Copyright belongs to the UK Government. All information used in this article is sourced from the official report Cyber Security Sectoral Analysis 2025 published on GOV.UK. This content is shared strictly for information and educational purposes only. There is no promotion, commercial use, or endorsement activity associated with this article.