Look at the salaries for generally competent software developers of any experience level in the UK. Now look in the US. It's not hard to see why our industry lags in the UK.
Look at the tax system that applies to employees in the UK. The scale in effect has massive increases in marginal tax rates part way along the curve that mean it's not a progressive system, for no sensible reason. It's even worse if you have kids, when at some points on the curve a huge proportion of any pay rise never actually reaches you in practice, or in extreme cases you can even be worse off after a pay rise, because of the strange ways that various allowances work.
Now look at the massive increases in effective taxation that have been applied to founders and owner-operators of small businesses in recent years. We're talking about 10-20% more of your revenues getting eaten by taxes before you get to keep any profits. In many cases you can now give up all the security and benefits of full-time employment (which are much better in the UK than the US, remember) and potentially invest your own money into bootstrapping your business, but then even if it works out modestly successful you end up paying higher tax rates than someone else taking a salary. Again, not hard to see why we're lacking in entrepreneurs.
Look at the flexible workforce. Contractors and freelancers in the UK live under a perpetual sword of Damocles called IR35 that has all but killed off the real flexible labour market in recent years and means even "contractors" are really being treated as disguised employees by default and again would probably be better off taking a permanent salaried position to get the extra job security and benefits. And given the difference in salaries as mentioned above, obviously some of the good people are then going to take their skills elsewhere.
None of this is news but successive governments have just stuck their heads in the sand and ignored the problems affecting smaller businesses, not just in tech but across other industries from healthcare to logistics as well. It's like they haven't noticed that there are 1,000 SMEs for every enterprise giant and collectively the SMEs create more jobs, pay more taxes, make more useful products... And then someone in government acts all surprised that our tech industry is lagging. Well, duh.