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The number of new technology companies in the South West soared to a record high in the third quarter of the year.

There were 709 incorporations in the period, according to the report by audit, tax and consultancy firm RSM º£½ÇÊÓƵ, jumping 31% from 540 a year earlier and up 6% from 672 the previous quarter.

Gavin Phillips, director and tech industry lead in the South West at RSM º£½ÇÊÓƵ, said: “The South West is home to a vast ecosystem of diverse tech companies, ranging from small start-ups to scale ups and established businesses. This is down to the strength of innovation in the region and its skilled workforce.

"While the region has all the right foundations for continued tech growth, sustained success will require further investment in talent development, economic stability and a more focused effort on digital infrastructure to allow it to thrive in key technologies such as AI.”

In the º£½ÇÊÓƵ, a total of 15,470 new tech companies were incorporated in Q3, rising 36% from 11,368 in the same quarter last year, and up 8% from 14,262 in Q2.

Ben Bilsland, partner and head of technology industry at RSM º£½ÇÊÓƵ, said there could be further growth in the fourth quarter in the wake of "positive messaging" from the º£½ÇÊÓƵ government on the tech sector. He also said the industry would likely be boosted by the US-º£½ÇÊÓƵ Tech Prosperity Deal.

"This deal pointed to deep investment in AI, civil nuclear energy, quantum technologies and further frontier innovations," said Mr Bilsland.

“º£½ÇÊÓƵ tech is showing resilience, with quarterly tech incorporations reaching another record high despite broader business confidence remaining subdued.