The importance of digital skills in building back better

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By Dr Abigail Taylor
Research Fellow, City-Region Economic Development Institute

The term ‘digital skills’ can be used to describe different categories of skills. Basic digital skills are those that all citizens need to be ‘digitally literate’. For example, conducting basic internet searches. Then you have digital skills for the general workforce. These include essential digital skills but vary by sector and are generally linked to using applications developed by IT specialists to process information. Finally, the term is also used to refer to digital skills for ICT professions, where digital skills are essential to the development of new digital technologies, and new products and services.

Why should we focus on improving digital skills now?

There has been increased demand for digital skills for some time:

  • Research over the last few years has emphasised the importance of digital skills in a range of roles. A review by the University of Warwick in 2018 found that “essential digital skills are needed in a wide range of occupations […], from elementary occupations and plant machine operators to managers
  • Evidence from the Employer Skills Survey cites a lack of digital skills among applicants as an important cause of skills gaps. The 2019 Employer Skills Survey, published this month, shows how in Coventry and Warwickshire LEP and Greater Birmingham and Solihull LEP, a lack of advanced IT, statistics, and data science skills represents a key recruitment challenge. Both areas are above the England average in terms of the proportion of skills-shortage vacancies in advanced IT caused by a lack of available skills.

This is predicated to increase further by 2030, when ‘basic digital skills’ are likely to be “increasingly advanced” compared to what we might think of as basic skills today. Analysis by the Industrial Strategy Council in collaboration with the McKinsey Global Institute has shown that by 2030 the UK workforce is likely to be considerably underskilled in basic digital skills. Consequently, unless skills levels improve, 5 million workers are likely to be acutely under-skilled in basic digital skills by 2030. Up to two-thirds of the workforce may face some level of under-skilling.

Major structural shifts tend to accelerate existing trends. In addition to the job losses caused by the crisis, workers around the world who remain in employment have faced changes in how and where they work including the rapid increase in the use of digital technology. Once the Covid-19 pandemic is over, there is potential for a further rapid rise in demand for digital skills, accelerating the speed with which workers are required to develop and adapt new digital skills. Digital skills will be crucial to recovery from the economic crisis created by the pandemic as companies seek to compete in increasingly challenging markets.

How can digital skills be improved?

In April 2020, the Department for Education launched The Skills Toolkit, which offers free online digital and numeracy courses to all. This represents an important step in the right direction. However, more is required to effectively develop digital skills among the UK workforce.

It is important that policymakers seek to enable employees to develop digital skills alongside other skills. Detailed qualitative interviews conducted with across the UK and responses reveal that firms of all sizes place high demand on their workforce possessing a mix of skills. Interviewees suggested that having a mix of digital, technological, negotiating and other social and behavioural skills was increasingly important in a rapidly changing and complex labour market.

To work most effectively, there needs to be increased collaboration between employers, training providers, central and local government. Universities also have a key role to play, particularly, at the upper end of digital skills.

The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of the University of Birmingham.

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