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‘Digital skills’ is a term used with increasing frequency, but it places a misleading emphasis on the technical skills a person needs to operate digital devices and software.

The term encompasses a variety of technical, social and cognitive skills that, together, enable a person to thrive in the digital environment of the contemporary world. These range in complexity from basic technical skills, such as using a mouse and sending an email, to specialised organisational skills, such as product management.

Why digital skills are important

1. Digital skills are a necessity for many jobs.

People who are digitally capable are more likely to be in work. According to the OECD, 90% of adults who performed at the highest levels of proficiency in using digital devices to solve problems participate in the labour force. In contrast, only 47% of adults with no experience in using ICT participate in the labour force.

The gap in employment levels between the digitally capable and the digitally unskilled looks set to expand. WEF predicts that up to 7.1 million jobs could be lost by 2020 as a result of technological development. Those at risk need to have the skills and flexibility to operate in digitally transformed environments.

2. Digital skills contribute to economic growth.

Accenture predicts that the digital economy will account for 25% of the global economy by 2020, totalling USD24,615bn. In any industry, digital innovations enable companies to create better products, access new markets and serve customers more effectively. To achieve these aims, companies need access to a supply of employees with specific expertise in areas such as data science, digital marketing and programming.

3. Digital skills enhance productivity and efficiency.

Common digital tools such as email and spreadsheets enable individuals in many jobs to work more productively and efficiently.

However, there is evidence of a shortage in the basic digital skills that people require to use these. The European Commission reports that 37% of the EU labour force have an insufficient level of digital skills, while the OECD states that 40% of people who use software at work every day do not have the skills required to use digital technologies effectively.

4. Digital skills enable people to access useful services.

Commercial and public organisations which digitise their services are able to reach more people at a lower cost. Digital services, such as banking, are also beneficial to citizens: Lloyds Bank in the UK found that digitally capable people save more money and avoid overdraft fees by using online tools.

Ensuring that everybody has the skills to access and use these services is an important element in the creation of a more prosperous society.

Key debates

1. What skills will people need for work in the future?

Unfortunately, it’s very difficult to accurately predict what skills we will need for the future of work. As robotics and AI advance, skills which are not currently at the core of existing roles will become more important – but it is not yet clear exactly what these will be.

Recent work by Nesta emphasises the importance of cognitive competencies and learning strategies as key skills in for the jobs of the future, while David Deming at Harvard University predicts that social skills will become more significant.

The best advice currently offered is to ensure that the workforce has the basic level of technical, cognitive and social skills that will enable people to be flexible in a changing work environment.

2. How big is the ‘digital skills gap’ at present?

According Nesta’s Future of Skills report, “the jury is out on the scale of long-term skills shortages in the labour markets of advanced economies”. Employer surveys frequently find that companies struggle to fill roles which require high levels of digital skills, but academic studies find that these claims may be overstated.

A related issue raised by Nesta and others concerns skills surpluses: many organisations are not structured to make the most of the digital skills that their employees actually have.