The Hidden Cost of Attrition: How Losing Women in Tech Is Draining the UK Economy

Rachel Sim, Consultant at Livingston James discusses how the 2025 Lovelace Report highlights the urgent need for the UK tech sector to retain and advance women by addressing systemic barriers, as gender imbalance threatens innovation, competitiveness and economic growth.

“The UK tech sector stands at a defining moment. With rapid advances in AI, digital technology and infrastructure, we have the chance to lead on a global scale – but only if we harness the full breadth of talent available to us.” This was the striking introduction to the 2025 Lovelace Report from Oliver Wyman and WeAreTechWomen. What was poignant throughout the report was the vast opportunity the UK has, but the equally stark risks that our economy faces.

Whilst inclusion of women and minorities is key for creating equal opportunities, there are costs to all if we do not create a sector which encourages women to join and stay in the industry. This report stresses a critical issue: the UK’s tech ambitions are being undermined by the persistent attrition of women in the sector. Competitiveness, innovation and economic growth will all be further inhibited if we do not unlock the full potential of our workforce.

 

The Current Workforce

Women account for only 20% of the UK tech workforce, a significant imbalance which is creating skills and talent shortages for organisations and enhancing labour challenges. The number of men in the sector continues to steadily increase annually. This imbalance will result in deep seated bias not being challenged, a lack of perspective and diversity of thought within the industry and limitations on economic growth.

Research suggests that the UK tech sector is already short 98,000 to 120,000 professionals and will need to double or triple capacity in the years ahead to meet the most in demand tech skillsets (AI, cybersecurity and digital infrastructure). It is estimated that “£1.4 billion to £2.2 billion is lost every year from women leaving the industry”. This loss is driven not only by women exiting the sector, but also by frequent job changes in pursuit of better opportunities. The frequency of women moving companies within the technology sector creates a drop in productivity and further instability of the market.

 

Why Women Leave

Studies have found the main drivers resulting in women leaving the sector are lack of development opportunities, lack of recognition and inadequate pay, with many sharing the sentiment that there is a sector bottleneck, where they get stuck at middle management level and miss out on senior leadership opportunities. Perhaps then, it is unsurprising that the biggest drain is in women with six to fifteen years in the industry – the point where you would anticipate an acceleration in senior opportunities brought to those professionals.

The study also found that caregiving responsibilities and flexible working are not inhibiting women in tech workplaces, therefore it is systemic challenges rather than personal requirements that are causing this trend.

 

Solutions from the Lovelace Report

The 2025 Lovelace Report cited the 3 practical strategies women feel would make the most impact in retaining them in the sector:

1. Actively monitor for career stagnation and intervene with concrete advancement opportunities
2. Ensure equitable, competency-based distribution of high-visibility work, allocating opportunities and regularly auditing staffing based on skills profiles rather than proximity or affinity
3. Build transparent career ladders with defined competencies, unambiguous progression requirements and equal pay

These actionable steps would result in significant change and impact on women and the broader industry across every age and stage of professionals within the field.

 

What’s Next

The UK is at a critical point where it is striving to position itself as a global leader. Whilst the UK has maintained its title of the European Fintech hub, this demonstrates that with an increase in investment and uptake in the sector, the UKs competitive position could be even further enhanced.

Simple and practical, data-backed solutions are key to progress. Clear career pathways which highlight exactly what is required to progress, equality of pay and equity of opportunities are required to retain highly skilled women and bring balance to the male-dominated industry, not just for the benefit of women, but also for the benefit of companies, innovation, profits and the economy.

The 2025 Lovelace Report has brought clarity to the challenges facing the UK tech market and the solutions which will support overcoming these institutional challenges.

 

For advice on attracting and retaining the best technology talent, please contact Rachel Sim: [email protected] for a confidential discussion.