The Tech Nation 2016 report, commissioned by Tech City UK in partnership with innovation charity Nesta, shows a total of 3,675 people are now employed in the sector.
The growth represents a 17% increase in the amount of people employed in the sector during the four year period, contributing massively to the local economy.
David Dunn, of Sunderland Software City, said: “Tech Nation 2016 shows that digital tech businesses are powering the economic growth of Sunderland.
“As a sector in its own right there is a rapidly-emerging reputation for digital excellence in the use of data around our specialisms in hardware, devices and software development.
“Equally important however is the fact digital tech businesses in Sunderland are now becoming horizontal enablers, allowing for productivity and efficiency gains across traditionally non-digital industries and thus benefiting the local economy further.”
Ed Vaizey, minister for the digital economy, added: “Digital technology companies are redefining the UK’s business landscape whilst creating new opportunities for entrepreneurs, investors and workers across the country.
“Tech Nation 2016 sets out how digital tech innovation is disrupting the UK economy, creating high-quality employment opportunities and driving productivity nationwide.
“We are delighted to present these findings which show how Britain’s digital technology continues to influence the wider business economy.”
The report also finds that the sector has a strong impact on employment nationwide, creating highly paid job opportunities, accounting for 1.56 million jobs across the UK.