How Quantum Computing Could Add £212bn to UK Economy by 2045

The global race for quantum computing supremacy has entered a new phase as companies compete to translate research breakthroughs into economic advantages. While the United States and China lead in total quantum investment, the United Kingdom’s quantum computing sector is a key focal point for European innovation, hosting more quantum startups than any other country in the region.

Unlike classical computers – which process information in binary bits of ones and zeros – quantum computers harness quantum mechanical properties to perform complex calculations, enabling them to tackle problems in hours that might take classical supercomputers millions of years to solve.

Now, according to research published by Oxford Economics, the UK quantum computing sector could deliver £212bn (US$263bn) in gross value added to the economy by 2045 – the equivalent to approximately £7,500 (US$9,315) per household.

Oxford Economics’ modelling also indicates quantum computing could increase productivity across the UK economy by 7% by 2045, equivalent to three additional weeks of productivity per worker annually.

UK quantum hardware funding falls behind global competition

The research highlights a funding disparity between the UK and other nations in quantum computing development. UK quantum hardware companies receive 10 times less funding per company compared to competitors in France and Australia, despite the UK having the largest number of quantum start-ups in Europe.

The funding gap becomes more significant as governments worldwide recognise quantum technologies’ importance to national security, with defence departments making large-scale funding announcements.

The UK quantum sector currently generates £128,020 (US$159,011) in gross value added per worker, compared to the national average of £61,900 (US$76,885). The direct contribution to UK GDP from quantum computing reached £135m (US$168m) in 2023, with projections indicating growth to £706m (US$876m) by 2034.

Sector growth projections show wide-ranging impact

The report forecasts sector-specific productivity gains, with electrical manufacturing and pharmaceuticals each projected to see 54% increases by 2055. The oil and gas sector could achieve 46% productivity growth, while defence and business services could see gains of 33% and 32% respectively.

In the transport sector, productivity gains could reach 26%, matching the projected increase for chemical products. Financial services could see a 24% boost, while agriculture might achieve a 10% improvement.

Gerald Mullally, Interim CEO of Oxford Quantum Circuits, says: “The UK is home to one of the strongest quantum ecosystems in the world, with world-class talent and research already driving breakthroughs. Quantum technology presents a once-in-a-generation opportunity to transform some of our most impactful and important industries and to secure the UK's position as a global leader in the next technological revolution.”

Employment multiplier effect drives job creation

According to the study, employment in the quantum sector could expand from 5,100 jobs in 2023 to 26,900 by 2034. By 2045, this figure could reach 126,100, growing further to 148,100 by 2055. The sector demonstrates an employment multiplier of 4.2, meaning each quantum computing job supports an additional 3.2 jobs in the broader economy.

In the transport sector, productivity gains could reach 26%, matching the projected increase for chemical products. Financial services could see a 24% boost, while agriculture might achieve a 10% improvement.

Gerald Mullally, Interim CEO of Oxford Quantum Circuits, says: “The UK is home to one of the strongest quantum ecosystems in the world, with world-class talent and research already driving breakthroughs. Quantum technology presents a once-in-a-generation opportunity to transform some of our most impactful and important industries and to secure the UK's position as a global leader in the next technological revolution.”

Employment multiplier effect drives job creation

According to the study, employment in the quantum sector could expand from 5,100 jobs in 2023 to 26,900 by 2034. By 2045, this figure could reach 126,100, growing further to 148,100 by 2055. The sector demonstrates an employment multiplier of 4.2, meaning each quantum computing job supports an additional 3.2 jobs in the broader economy.

Only 24% of these jobs will exist within the quantum sector itself, with the remainder supported through supply chain activities and consumer spending from sector employees.

Andy Logan, Director at Oxford Economics, says: “Our analysis makes clear that the UK's quantum ecosystem has the potential to deliver significant economic benefits in the future in terms of economic growth, skilled jobs, and wider productivity gains. These will make several British industries more competitive and enhance the population's standard of living.”

Commercial viability scenarios show economic impact

The research presents two scenarios for commercial viability. If quantum computing becomes commercially viable by 2035, the technology could add £23bn (US$28.6bn) to UK GDP by 2035, increasing to £284bn by 2050. An earlier commercialisation date of 2029 could result in £95 billion added to GDP by 2035, reaching £285bn (US$352.7bn) by 2050.

The optimistic scenario projects an 8% economy-wide productivity increase by 2040, adding more than £200bn (US$248.5bn) to national GDP. This timeline depends on sustained investment and government support for the industry.

Dr Nicola Hodson, Chair of IBM UK & Ireland, says: “From accelerating scientific discoveries, to strengthening national security and turbocharging productivity, this research underlines the powerful benefits quantum computing can deliver across the UK economy in the coming years.”

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