Ecosystems

uk-lost-e2.3b-in-tax-from-big-tech-because-rules-are-‘no-longer-fit-for-purpose’

UK lost €2.3B in tax from big tech because rules are ‘no longer fit for purpose’

Corporates and innovation, Ecosystems, Government and policy / /

Up to €2.3bn of annual tax from big tech may be missing from the UK’s coffers because of archaic rules.

That’s according to TaxWatch, a think tank formed to expose abuses of the taxation system. In new research, the group analysed the finances of seven tech giants: Apple, Microsoft, Meta, Amazon, Adobe, Cisco, and Google owner Alphabet.

TaxWatch estimates these companies made almost £15bn (€17.3bn) of profit from British customers in 2021 alone. However, international tax rules allow these firms to shift most of these profits to other countries. As a result, they were only liable for annual UK taxes of around £753mn (€869mn).

If the profits had not been moved elsewhere, that figure could have quadrupled. TaxWatch estimates that the tax due would have been around £2.8bn (€3.2bn).

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The research, however, doesn’t claim that the tech firms have used any illegal practices.

Under current tax rules, multinational corporations can lawfully operate worldwide while concentrating their profits in low-taxed jurisdictions. Consequently, they can dramatically shrink their tax burden in some of their biggest markets.

Claire Ralph, the director of Taxwatch, told TNW that the shortfall stems from outdated laws.

“The international tax rules were developed when trade was based on trading manufactured tangible goods, whereas we now have a services-based digital economy where data, algorithms, and AI are delivering much more profit,” she said. 

“Whilst the UK has various anti-avoidance provisions to try to limit this, it’s a constant battle of cat and mouse — the rules are no longer fit for purpose.”

Big tech’s tax tactics

These issues are widespread, but they’re particularly acute at tech companies.

One reason for this is the sector’s uniquely cross-border operations. As tech firms can operate across multiple countries without a physical presence, they can easily shift profit sources to countries with extremely low tax rates.

Tech giants can thereby get a global reach from headquarters in low-tax countries.

Another factor is the propensity for services to be provided by one tech group company and “traded” within the group. Transactions are rarely kept at arms-length — which makes it harder to calculate a normal allocation. 

“The market dominance of some global giants is distortionary,” Ralph said.

In addition, big tech has enormous profits. Three of the five most profitable companies in the world are tech companies, according to Forbes. (Oil giant Saudi Aramco is number one, followed by Apple and Microsoft. The fourth spot goes to another oil behemoth, Exxon Mobil. Alphabet rounds off the top five.)

When the profits are so enormous, there’s a greater incentive to shift them into other jurisdictions — because the rewards are higher.

A global tax problem

Around the world, lawmakers are trying to force big tech to pay more tax. One effort is a global plan from the Organisation for Economic Cooperation and Development (OECD).

The initiative aims to let countries capture more tax revenue domestically — but progress has been slow. There are now growing concerns that countries will ditch the international agreement for local laws.

To the ire of the Biden administration, Canada is currently developing its own digital services tax. The White House has threatened to impose retaliatory measures.

The UK, meanwhile, introduced a domestic digital sales tax in 2020. The measure applies an extra levy to tech giants, but critics expect companies will circumvent the rules.

TaxWatch has raised doubts about both the global and national schemes.

“Reform of the international tax regime is overdue,” Ralph said. “TaxWatch has concerns that neither developments championed by the OECD, nor the UK’s Digital Services Tax will deliver for the UK.”

In addition to reform, Taxwatch has called for greater transparency. The think tank wants the British government to require greater public disclosure of profits for tax purposes. This would make it easier to discern the tax contributions from large companies.

“The lack of information about how much profit is earned and how much tax is paid is itself a major issue,” Ralph said.

UK lost €2.3B in tax from big tech because rules are ‘no longer fit for purpose’ Read More »

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Google and Qualcomm are building a RISC-V-based platform for wearables

Corporates and innovation, Ecosystems, Insider / /

RISC-V, the upstart chip architecture, has stepped further into the market for processors.

Semiconductor giant Qualcomm today announced that it’s building a RISC-V-based wearables platform for Wear OS, Google’s operating system for smartwatches.

The system will expand Qualcomm’s lineup of Snapdragon Wear processors, which power the bulk of Wear OS products.

According to Qualcomm, the new solution will reduce the time to market for original equipment manufacturers (OEMs) when launching smartwatches.

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The company told TNW that RISC-V offers both performance and power advantages for wearable platforms.

“Our Snapdragon Wear platform innovations will help the Wear OS ecosystem rapidly evolve and streamline new device launches,” said Dino Bekis, a vice president at Qualcomm.

The platform is another boost to RISC-V, which is providing growing competition to Arm, the UK-based chip designer. RISC-V’s open-source instruction sets offer a low-cost, efficient, and customisable alternative to Arm’s blueprints.

In August, five chipmakers, including Qualcomm, announced a new alliance to commercialise the emerging contender. Qualcomm has been one of Arm’s biggest customers, but the two companies are now embroiled in a legal battle. 

Tensions between the partners emerged during the proposed Nvidia takeover. In May 2022, Qualcomm’s CEO said he wanted to buy a stake in Arm — or even acquire it outright. A few months later, Arm sued Qualcomm. The lawsuit accuses the US business of using Arm IP without permission.

RISC V prototype chip.
RISC-V architectures have won support as concerns grow about Arm’s neutrality. Credit: Derrick Coetzee

Qualcomm is not alone in nurturing competition for Arm. RISC-V, which is headquartered in Switzerland, has also attracted glowing praise from Google. In December, Lars Bergstrom, Android’s director of engineering, called for the architecture to become a “tier-1 platform” in the operating system — the same level as Arm. 

The wearables collaboration adds another endorsement for RISC-V.

“We are excited to extend our work with Qualcomm Technologies and bring a RISC-V wearable solution to market,” said Bjorn Kilburn, GM of Wear OS by Google.

In less auspicious news for RISC-V, a group of US politicians want the White House to restrict American companies from working with the open-source technology. The lawmakers have raised concerns about China accessing the tech.

Representative Mike Gallagher, chairman of the House select committee on China, told Reuters that the Commerce Department should “require any American person or company to receive an export license prior to engaging with PRC (People’s Republic of China) entities on RISC-V technology.”

In response, the CEO of RISC-V International warned that the restrictions would damage the chip industry.

“Contemplated actions by governments for an unprecedented restriction in open standards will have the consequence of diminished access to the global marketplace of products, solutions, and talent,”  Calista Redmond, chief of RISC-V International, wrote in a blogpost last week. “Bifurcating on the standards level would lead to a world of incompatible solutions that duplicate effort and close off markets.”

Google and Qualcomm are building a RISC-V-based platform for wearables Read More »

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UK plan to lead in generative AI ‘unrealistic,’ say Cambridge researchers

Deep tech, Ecosystems, Startups and technology / /

The British government’s aim to turn the UK into a global leader in the development of generative AI is “unrealistic,” researchers at the University of Cambridge argue.

According to the associated report, the country lacks both the necessary capital investment and computing power to build generative AI fast enough to compete with tech giants such as Microsoft, Google, and OpenAI.

“The UK has no companies big enough to invest meaningfully in foundation model development,” said Sam Gilbert, co-author of the report. “State spending on technology is modest compared to China and the US, as we have seen in the UK chip industry.”

For example, while ChatGPT’s computing cost is estimated at $40mn (£33) per month, the government’s new Frontier AI Taskforce has allocated an initial £100mn ($121mn) for the development of home-grown AI.

The report also pointed out that despite the crucial role computing hardware plays, the UK hosts no major clusters of Graphics Processing Units (GPUs) — necessary to handle large amounts of data for machine-learning models. Meanwhile, the researchers don’t expect the country’s £900mn supercomputer devoted to AI research in Bristol to be online until 2026.

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Call for new (and doable) AI goals

The UK still has the chance to be a global leader, the researchers say, albeit in a different way than the one envisioned by the government. And that’s by “actually plugging these AI technologies into the economy,” said Diane Coyle, Bennett Professor of Public Policy at the University of Cambridge.

This means using the country’s strengths in cybersecurity, fintech, and healthech to build software and, in turn, focus on leveraging generative AI for real-world applications. But even for this plan to succeed, the report warns that there are two missing elements.

First comes the need for tax incentives to companies either developing AI-powered services or including generative AI in their operations. For instance, this could take the form of an enhanced Seed Enterprise Investment Scheme to increase capital supply for AI startups.

Most importantly, the researchers highlighted the significance of a new, “solid legal and ethical” AI regulation to foster public and business trust.

“The UK’s current approach to regulating generative AI is based on a set of vague and voluntary principles that nod at security and transparency,” said Dr Ann Kristin Glenster, co-author of the report.

“[The country] will only be able to realise the economic benefits of AI if the technology can be trusted, and that can only be ensured through meaningful legislation and regulation.”

UK plan to lead in generative AI ‘unrealistic,’ say Cambridge researchers Read More »

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VC funding in Europe rose in Q3 2023, but favoured late-stage startups

Ecosystems, Insider / /

In the third quarter of 2023, European startups raised $16.4bn (€15.6bn) in VC funding — a 28% increase quarter over quarter.

The findings are based on an analysis by Crunchbase, which also unveiled that the fresh capital has mostly favoured late-stage rounds. In contrast, funding for seed and early-stage companies hit its lowest points since Q3 2022.

Specifically, late-stage funding doubled quarter over quarter, reaching $10.5bn (€10bn) in total. Notably, VCs invested large sums in the sustainable energy sector, with big rounds raised by Sweden’s H2 Green Steel, battery manufacturers Northvolt and Verkor, and London-based battery storage startup Zenobe Energy.

Μeanwhile, seed funding added up to $1.4bn (€1.3bn), down from $2.1bn (€2bn) last year. Alongside its 30% year-over-year drop, it also fell by 25% quarter over quarter. Similarly, early-stage companies saw another low at $4.5bn (€4.3bn) with the largest amount of capital invested in Series A.

On the bright side, European startups have managed to raise a bigger proportion of global venture capital compared to last year. Their share reached approximately 23%, while VC funding in North America remained flat. Europe’s AI companies also accounted for close to one-fifth of the sector’s global funding, representing 11% of the region’s total capital raised in the past quarter.

Overall, Europe’s highest capital injection was concentrated in the UK, followed by Sweden, France, and Germany.

“The pullback in venture has made a huge difference in how capital-efficient a startup needs to be,” said Michiel Kotting, partner at Northzone, a London-headquartered multi-stage VC firm.

He noted, however, that the amount of capital raised isn’t the only measure of success for tech companies, adding that the economic downturn “does not make entrepreneurship harder or disfavor tech.”

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GG Microsoft! UK clears $69B Activision Blizzard deal

Ecosystems, gaming, Government and policy, microsoft / /

After a lengthy process of regulatory scrutiny, the biggest deal in gaming history finally has the all-clear. Today, the final hold-out in the saga, the UK’s CMA, said it had approved Microsoft’s acquisition of Activision Blizzard, after the parties had made “gamechanging” amendments to the terms. 

The antitrust watchdog stated it had been swayed by Activision’s agreement to sell its streaming rights to Ubisoft Entertainment. What this effectively means is that its blockbuster video games will not become exclusively available via streaming to Microsoft Xbox gamers following the takeover. 

“The new deal will stop Microsoft from locking up competition in cloud gaming as this market takes off, preserving competitive prices and services for UK cloud gaming customers,” the CMA said in a statement.

According to Statista, revenue in the cloud gaming market is projected to reach $4.34bn (€4.1bn) in 2023. It could then show an annual growth rate of 44.09%, which would result in a market volume of $18.71bn (€17.7bn) by 2027.

With the approval, Microsoft now has the opportunity to close the $69bn (€65.4bn) deal by October 18, three months after the original deadline. 

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CMA decidedly unhappy with Microsoft tactics 

Activision Blizzard makes household franchises such as Call of Duty, World of Warcraft, and Candy Crush. Microsoft first announced its intention to purchase the Fortune 500 video game publisher in early 2022. When the CMA blocked the deal in April this year, Microsoft said the UK was “closed for business,” and that it was the “darkest day” in its 40 years operating in the country.



The EU granted its approval in May 2023, while US regulators followed suit in July. Meanwhile, the lengthy back and forth with the UK watchdog has been one of the most publicised and contentious antitrust processes in Britain to date.



CMA chief executive Sarah Cardell said the agency had delivered a clear message to Microsoft that the deal would be blocked unless they comprehensively addressed concerns and “we stuck to our guns on that.” She further added that the CMA’s decision had been “free from political influence” and that the agency would not be “swayed by corporate lobbying.” 

“Businesses and their advisors should be in no doubt that the tactics employed by Microsoft are no way to engage with the CMA,” Cardell stated, in what could be considered a less than entirely amicable tone. 

Hard to remember a more fractious affair, competition advisor says

Indeed, the CMA’s statements appear to lay down a marker that publicly litigating appeals against the agency in the press will be “seen in an exceedingly poor light in the future.” That is according to Gareth Mills, who is a partner at law firm Charles Russell Speechlys and advises on commercial dispute resolution, regulatory, and competition matters. 

“In a UK context, it’s hard to remember a more fractious affair and the comments made by the CMA’s chief executive as part of the approval makes it clear that some of Microsoft’s tactics have left a bitter taste, despite the final collaborative resolution,” Mills told TNW. 

“Ultimately, this approval allows both sides to claim a satisfactory result. Microsoft have the deal finalised and the CMA can justifiably point to the remedies offered by Microsoft to facilitate the deal’s approval as evidence that its original rejection was a correct use of its powers.”

For its part, Microsoft was somewhat more conciliatory in its comments on the approval than the CMA. Brad Smith, the tech giant’s vice chair and president, said:

“We’re grateful for the CMA’s thorough review and decision today. We have now crossed the final regulatory hurdle to close this acquisition, which we believe will benefit players and the gaming industry worldwide.”

GG Microsoft! UK clears $69B Activision Blizzard deal Read More »

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Europe outpaces US and China in hydrogen investment, says EU president

Ecosystems, Government and policy, Sustainability / /

From transportation to heavy industries, clean hydrogen has emerged as a key element in the transition to climate neutrality — and the EU wants to ensure that the fossil-fuel alternative joins its arsenal.

In a speech to representatives of hydrogen’s entire value chain, Commission president Ursula von der Leyen set out how the bloc’s strategy is driving private investment. “Europe is now attracting more investment in clean hydrogen than the US and China combined,” she said.

The union’s roadmap essentially consists of three elements: clear rules, public funding, and international agreements.

Von der Leyen noted that the EU’s regulatory framework is almost complete. It’s designed to enable the bloc to reach 20 million tonnes of renewable hydrogen by 2030, equally split between domestic production and imports.

“Our goal is simple. We want to bring European hydrogen from niche to scale.

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The framework includes state aid rules and infrastructure investments, as well as legislative targets for the industrial and transportation sectors. “[This] means clarity and predictability for your investments. We are the only continent where this is the case,” said the president.

In terms of public funding, the bloc is already financing hydrogen trains, valleys, and clean-steel factories as part of the NextGenerationEU and RepowerEU initiatives. It has also authorised over €17bn in state aid for 80 hydrogen projects across the union.

The next step is the first auction of the Hydrogen Bank, set to open on November 23. The auction will award up to €800mn to EEA-based clean hydrogen producers. The support is designed to fill the gap between production costs and the price the market is willing to pay, which is expected to help hydrogen markets scale up, while reducing costs for consumers.

Regarding the third pillar of action, the EU has signed hydrogen partnerships with countries including Kenya, Egypt, Namibia, and several Latin American nations.

According to von der Leyen, Europe is already seeing successful results. There are now 38 hydrogen-powered clean-steel factories either in operation or planned; 67GW of electrolyser capacity in the pipeline; and multiple cities have seen the inclusion of hydrogen transportation options.

However, the EU president highlighted that there are many more steps to be taken and called the industry players to make proposals about the risks and needs of the sector.

“Our goal is simple,” she said. “We want to bring European hydrogen from niche to scale. We want Europe to be the global home of clean hydrogen.”

Europe outpaces US and China in hydrogen investment, says EU president Read More »

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Taiwan’s semiconductor suppliers plan to invest in European chip factories

Ecosystems, Insider / /

Amid the global race for semiconductor chips, Taiwanese suppliers are considering investing in Europe, the Financial Times reports.

“We are planning investments in Germany, and the European market is going to be ours,” Vincent Liu, president and chief executive of LCY Group, told the newspaper. The company supplies cleaning agents and solvents to Taiwan Semiconductor Manufacturing Co (TSMC) — the world’s biggest contract chipmaker.

Alongside LCY Group, three more chemicals suppliers to TSMC said they’re eyeing investments in Europe.

The interest appears to be related to the emergence of the first advanced chip factories in the bloc — a move supported by the EU’s Chips Act, which aims to mobilise €43bn in public and private investments. Its aim is to ultimately bring the union’s share in global production capacity from 10% to 20% by 2030.

Under the scheme, the EU is offering subsidies to incentivise foreign chip manufacturers to set up factories within its borders. Intel, for example, has pledged to invest €30bn in two chip plants in Germany, while it’s planning to build a €4.6bn semiconductor assembly and testing facility in Poland.

Meanwhile, TSMC has teamed up with European chipmakers Infineon and NXP and auto supplier Bosh to build a €10bn chip plant in Germany. Multinational chipmaker GlobalFoundries and European chip company STMicroelectronics are also planning a €5.7bn factory in France.

“The global race for leadership in chips is a fact and Europe must secure her active part in it,” said Věra Jourová, the Commission’s VP for Values and Transparency, when the Chips Act came into force in September.

Establishing domestic production and strengthening the supply chain will indeed be critical for the EU’s aim to tackle its heavy reliance on a few foreign suppliers, China and Taiwan for manufacturing, and the US for design.

And while experts claim semiconductor independence is “impossible” for the EU (and for any other country for that matter), such investments would in all certainty help boost the bloc’s competitiveness in the sector.

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Cambridge aims to double its unicorns, plans support scheme for founders

Ecosystems, Startups and technology / /

Home to over 5,300 high tech companies, Cambridge is among the world’s leading university-based ecosystems. Ranked as the third most important science hub globally in 2022, the city counts 23 unicorns and its university-backed startups have raised over £3bn in research investment.

Now, Cambridges aims to more than double its unicorns by 2035 under a new scheme led by a partnership of local universities, government bodies, and industry players including Microsoft and AstraZeneca.

Announced today, the Innovate Cambridge initiative will seek to support business growth and double the number of multinational companies in the area to 40. The initiative has also partnered with Manchester to foster innovation in both cities, and create local hubs to facilitate the relationship between researchers and entrepreneurs.

Meanwhile, earlier this week, the University of Cambridge launched a new flagship programme to support spinout founders in their scaling and commercialisation journey. The initiative will combine capital, networks, and talent, while it will focus on founders (mainly active in deep tech) whose products are solving world-pressing problems such as the climate crisis and aging population.

Founders who join the programme are expected to raise over £700mn in the first five years.

“Cambridge already has a global reputation for producing world-leading technology businesses such as ARM Holdings, Darktrace, FeatureSpace, and Healx,” said Gerard Grech, the initiative’s managing director and former CEO of Tech Nation. “Creating fertile pathways for our top innovators to bring their game-changing solutions to market is vital.”

Both programmes are a breath of fresh air for the UK government, whose ambition to turn Cambrigde into “the science capital of Europe” has been facing a series of hurdles.

Earlier this year, housing secretary Michael Gove unveiled a £5mn “Cambridge 2040 Plan” in response to the problems delaying the city’s growth. But that plan has been hindered not only by local opposition to residential construction, but also by insufficient water and transport infrastructure.

“Cambridge needs to provide for its high tech growth,” Lord David Willets, the chair of Innovate Cambridge, told the Financial Times. “The good news is that it is already in the planning system. The bad news is actually getting all this through is tricky with a whole range of issues.”

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Drone startup launches grocery delivery in Germany

Drones, Ecosystems, Electric vehicle, Startups and technology, Sustainability / /

This Thursday, German startup Wingcopter launched a drone and electric cargo-bike delivery project to bring everyday consumer goods to remote rural areas in Central Germany. 

Just as with ordinary grocery delivery, customers in Michelstadt, Hesse, will be able to place their orders via a website and decide on a convenient delivery time slot. Autonomous Wingcopter drones will then deliver non-perishable products from a local supermarket to a drop-off point outside of villages. The final stretch to the customer’s door will be covered by cargo-bikes (with human) from e-bike producer Riese & Müller. 

Initially, the pilot project, named “LieferMichel,” will offer non-perishables from the local REWE supermarket (one of Wingcopter’s backers), with the intention of adding more retailers if the project proves successful. 

“We are really proud to pilot LieferMichel, the first drone delivery service for groceries and everyday goods in Germany,” said Tom Plümmer, CEO of Wingcopter. “Our biggest goal is to gain experience and evaluate, together with the residents, an environmentally friendly and efficient service that creates real added value for the population in rural areas.” 

A group of people standing behind a Wingcopter drone with cargo bike to the side
The drone will fly to a drop-off point where are cargo-bike (plus human) will take over the final bit of logistics. Credit: Wingcopter

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Wingcopter is conducting the Drone-Cargo Bike Express Delivery (DroLEx – Drohnen-Lastenrad-Express-Belieferung) project in collaboration with the Frankfurt University of Applied Sciences (Frankfurt UAS). The pilot is funded by the German Federal Ministry for Digital and Transport (BMDV), as part of a broader “Innovative Air Mobility” funding directive of €430,000. The LieferMichel pilotwill initially run until the end of 2023. 

Grocery delivery just one of many air mobility use cases

Founded in 2017 by Plümmer and co-founders Jonathan Hesselbarth (CTO) and Ansgar Kadura (CSO), Wingcopter makes uncrewed all-electric delivery drones and also provides drone delivery services. Backed by the European Investment Bank, REWE Group, and Salvia, among others, the Darmstadt-based company currently employs 150 people. 

Its latest drone is the Wingcopter 198, built on patented tilt-rotor technology that makes it withstand strong winds and rain as it goes about its mission. It has a payload capacity of up to 5kg, range up to 110km, wind resistance of 15m/s average, and 20m/s gusts, and a default cruise speed of 100km/h.



It is also equipped with a redundant system architecture of dual airspeed sensors, dual heading and positioning systems, and dual flight controllers.

Zero-emission grocery delivery options may indeed prove to be vital for the survival of remote rural areas in the future. However, Wingcopter’s product has several other use cases. The company has already deployed its drones for on-demand medical delivery to remote islands in Vanuatu and Ireland, volcano inspection in Italy, and infrastructure inspection in Norway, among other projects. 

To see one of Wingcopter’s drones in action (and catch a glimpse of German rural landscapes) watch the video below.

This blisteringly hot AI-powered grill cooks food ‘up to 10x faster’ Read More »

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VC Atomico raises €1B in glimmer of hope for European tech startups

Ecosystems, Europe, Investors and funding / /

It is no secret that European tech funding has seen an alarming decline throughout the past 24 months. Thankfully, there are still some bright spots. London-based venture capital firm Atomico is challenging the trend, having raised $1.1bn (€1.05bn) of new funding to invest in tech startups. 

Atomico will use the funds across both its new venture and growth funds, according to a US regulatory filing seen by the Financial Times. As such, it will be hoping to at least soften the gloomy predictions from its own data presented earlier this year on the state of European tech investment. 

According to figures released by the VC in June, European tech was on track for a 39% reduction across the year, dropping from $83bn (€79bn) in 2022 to $51bn (€48.65bn) in 2023. That follows a harsh 2022, which had already seen a 22% drop in tech startup funding across the continent, down from $106bn (€101bn) in 2021.

Economic headwinds have prompted new investment strategies, with restructuring leading to mass layoffs and hiring freezes for startups across the region. US participation in European deals has also dropped, according to data from Pitchbook. In July, American participation in VC deal value was down 69% year-on-year.

However, more trend-resilient sectors such as pharma and biotech have escaped relatively unscathed. Furthermore, the generative AI gold rush is spurring optimism for software startups in the field. 

Europe the new ‘tech superpower’ Skype founder says

Established by Skype founder Niklas Zennström in 2006, Atomico has backed well-known companies such as Klarna, Stripe, Telegram, and Masterclass over the years — plus another 100+ startups. Among them are Finnish game developer Supercell, German AI translation platform DeepL, British carbon project financing platform Opna, and German electric jet developer Lilium. The firm has $5bn (€4.76bn) under management and previously raised $820mn (€780mn) for its fifth fund in 2020.

Despite the current dip in funding for the sector, Zennström, who grew up in the same Swedish university town as the author of this article, is bullish about the future of European tech. In particular, he is excited about the number of second- and third-time founders that have learned from failures and success on previous rides on the startup merry-go-round, and can build stronger businesses as a result. 

Indeed, in a blog post from this summer, Zennström stated that Europe had the “potential to create more value from technology than any other region,” and the opportunity to become a “tech superpower,” creating a better technological future, which would truly meet the needs of modern society. We are here for it.

VC Atomico raises €1B in glimmer of hope for European tech startups Read More »

job-satisfaction-in-european-tech-on-the-rise-—-but-dutch,-swedes-least-happy

Job satisfaction in European tech on the rise — but Dutch, Swedes least happy

Ecosystems, Future of Work / /

Levels of job satisfaction among young tech workers in Europe have bounced back this year. The proportion of employees feeling unhappy in their role fell from 35% in 2022 to 15% in 2023.

The findings come from the Young Generation in Tech report (backed by Eight Roads Ventures Europe and HR platform HiBob), which surveyed 2,000 20- to 30-year olds working in tech across seven countries: the UK, Ireland, France, Spain, Germany, Sweden, and the Netherlands.

Nearly half of respondents (48%) said they’re “very satisfied” with their role, and 63% plan to stay in their job for the foreseeable future. Only a year ago, the same group reported feeling disappointed, with one in four on the verge of quitting.

Meanwhile, the vast majority of respondents (82%) stated that their experience in the company they work for “reaches” or “exceeds expectations.” A whopping 77% shared that they’ve been promoted at least once in the past 24 months. Similarly, the feeling of job security has increased from 51% last year to 59%.

Not everyone’s happy

Among the respondents, Dutch and Swedish tech workers reported the highest levels of job dissatisfaction at 17.7% and 25.3%, respectively. They were also the groups that felt most insecure in their role — 24.7% in the Netherlands and 25.6% in Sweden.

In addition, most of the respondents from the two countries expressed zero confidence in the companies they work for. This number reaches 32.2% in Sweden and 38.7% in the Netherlands, while the European average stands at 28.19%. Perhaps more alarmingly, more than half (58%) of respondents across all regions said they’re nearly or entirely unconfident.

Pay me more

When it comes to staying at or leaving a job, the top two most important factors were compensation and promotions. Other motivations included company growth and success and flexible working opportunities.

Beyond compensation, the surveyed employees valued hybrid and flexible shifts the most, followed by budgets for learning and development, and health benefits. A four-day work model and the possibility to work from anywhere for a while ranked fourth and sixth.

Back to the office

While flexibility is among the top priorities, young tech workers are returning to the office. More than half of all respondents (56.14%) said they prefer working at the office four to five times per week. Hybrid work came second at 34.49%, with nearly 40% of the employees reporting that they feel equally engaged both at home and in the office.

Only 9.38% of respondents showed preference towards fully remote work, with the set-up most appreciated by employees in Ireland and France.

Embracing AI

Despite fears of AI taking over jobs, 78% of the people surveyed were confident about the technology’s impact on their role. The majority stated that artificial intelligence will boost their productivity, efficiency, and creativity, while only 11% are against using AI tools.

“Not surprisingly, [tech’s youngest workers] are the fastest generation to embrace AI, seeing it as a strong productivity lever, and not a threat. AI is one of the most significant innovations of our time, and it’s great to see younger people so engaged with it,” said Davor Hebel, Managing Partner at Eight Roads Ventures.

Job satisfaction in European tech on the rise — but Dutch, Swedes least happy Read More »