SCOTTISH workers will be required to fill the majority of new roles in the country’s digital technology sector as the UK becomes a country of “decreasing attractiveness” for international talent.

But fears are mounting as to whether sufficient Scots have the necessary skills to meet the demands of an industry in which 80 per cent of companies expect revenue to grow this year.

A new survey published today from the sector’s trade association ScotlandIS reveals that three-quarters of businesses expect to recruit the majority of new staff from within Scotland, rising from 60 per cent last year.

At the same time, the percentage of businesses forecasting that new talent will come from outside the UK has dropped to just nine per cent, from 21 per cent.

ScotlandIS reported that 78 per cent of firms forecast that they will hire more staff in 2017, compared with 66 per cent in 2016.

Polly Purvis, chief executive of ScotlandIS said: “Our survey shows that more companies are looking to Scotland to recruit new employees. This is likely to be a sign of Brexit related concerns and the decreasing attractiveness of the UK for international talent.”

And the survey shows that Europe and North America are seen as more attractive export markets to Scottish digital companies than the rest of the UK.

When asked to highlight three geographical markets attractive for exports, Europe and North America were each cited by 52 per cent of respondents, while the rest of the UK lagged on 47 per cent.

In spite of the possible skills shortage, the research found the sector abound with optimism after two-thirds of firms saw growth last year.

The digital technology industry, which includes firms operating in the telecoms, software, information technology (IT) and digital media sectors, is estimated to employ 90,000 people in Scotland – adding £5 billion gross value added to the economy.

The research found 72 per cent of businesses plan to hire graduates this year, while 83 per cent are looking for experienced staff. Further to this, 38 per cent reported they were likely to recruit modern apprentices – which is likely linked to the introduction of new digital apprenticeship frameworks.

This is the first time since 2013 that the demand for experienced staff outstrips graduates and Ms Purvis has called on the industry to further invest in skills to ensure the workers are available. ScotlandIS had previously reported that three-quarters of Scottish digital technology (IT) companies were concerned that Brexit would have a detrimental impact on their access to skilled staff.

Ms Purvis welcomed the Scottish Government’s commitment to develop a £36 million, three-year support fund to meet the upfront business costs of digital skills training.

And she highlighted CodeClan, a facility that enables people to retrain for a career in digital technology, and the Scottish Government’s digital framework as measures that were helping to meet the increasing demand, but she said more was required.

“Further industry investment in skills is now needed more than ever, particularly around work-based learning and up-skilling the existing workforce,” she said.

Gordon Brown, ScotlandIS board member and head of technology and digital at Nine Twenty Technology, which sponsored this year’s survey, added: “The reality is, if we don’t invest more heavily in our sector and in the early lives of future generations we will never be able to keep up with demand for skilled people.”

Seven in ten companies reported an increase in revenue in 2016, though at lower levels than in the previous year, but more businesses were ahead of budget (30 per cent) than below (24 per cent). This year, 82 per cent of businesses expect sales to increase and 78 per cent said they have a very optimistic or optimistic view for the year ahead.

Ms Purvis added: “The results... show the confidence and resilience of the digital technologies industry which is continuing to grow and maintain its optimistic outlook despite uncertainties in the political environment.”