What is the digital skills gap?

The digital skills gap affects workers in virtually every role—but what is it, exactly? Simply put, the skills gap refers to the lack of digital skills held by workers and the number of skilled workers needed to push growth in tech businesses.

The fact that today’s workers tend to lack digital skills is a growing concern. All of us are part of an increasingly digitised world (thanks in part to the COVID-19 pandemic) where digital skills are necessary for jobs across all industries. Everyone needs a strong level of digital literacy, and keeping up with emerging tools and technologies has never been more important.

There’s also a hefty financial repercussion. According to Accenture could cost the UK’s GDP growth up to £141 billion over the next ten years.

Tackling the skills gap might seem like a daunting prospect, but it’s also an excellent opportunity to upskill and empower existing workers. In fact it's one of our goals here at Potential.ly (to learn more, check out our free case study video).

What are the causes of the digital skills gap?

Different businesses are affected by different aspects of the digital skills gap—and that makes pinpointing its causes a tricky task.

Consistent factors do exist, however. For example, there’s a voracious demand for skilled workers and just not enough workers to meet it. Businesses also often lack the tools or resources to provide training to their employees.

The digital skills gap existed prior to the COVID-19 pandemic but its impact on how we work, and the rise of remote and hybrid work, has placed an even higher value on digital literacy. As a result, employers want to hire candidates who can use a variety of digital tools, keep up with continued digitalisation, and thrive in online roles—but few candidates have the right training or experience.

Let's take a closer look at some of the main culprits behind today's digital skills gap.

1. Lack of digital literacy among employees

When we talk about digital literacy, we’re talking about a person’s ability to confidently use the internet to communicate, work, and conduct research, all whilst being mindful of security practices. A high level of digital literacy is hugely important seeing as most of today’s jobs have some online aspect—whether we’re engaging with social media, a content management system (CMS), or hopping into Zoom calls. As you might’ve guessed, workers with a low level of digital literacy tend to be less productive.

You might expect everyone to have a solid level of digital literacy—after all, the internet has permeated nearly every aspect of our lives. It’s not always the case, however, and it’s important to take stock of the varying literacy levels in your team. Otherwise, workers might get left behind or made to feel inadequate.

2. Lack of access to digital resources

A Dynamic Signal report found that 36% of employees don’t know where to find the information they need to do their jobs. It might be that a company lacks training resources or recorded processes, but if the information isn’t there, then a worker can’t utilise it. As a result, the employee might spend an inordinate amount of time searching for resources to help them understand the tools they’re using.

60% of adults also said that they find it easier to learn digital skills via work, though only 23% have actually received training, and this discrepancy has only worsened since the pandemic disrupted communication channels. If a company doesn’t have structured resources or training programs, and an employee doesn’t know who to turn to, it’s an immediate dead end.

3. Lack of digital skills among employees

It’s estimated that in the next 10 to 20 years, around 90% of jobs will require some form of digital skills. However, 37% of European workers don’t have even basic digital skills.

A lack of digital skills makes it much harder for workers to go about their day-to-day tasks in modern roles—but even those workers with digital skills can struggle to keep up with an influx of trends and technologies. In fact, a FutureDotNow report claimed that 32% of skilled workers in the UK have difficulty using digital systems and don’t know how to adjust privacy settings on social media platforms. The shift to remote working has also made it more difficult for workers to learn these competencies on the job—a disruption that actively widens the digital skills gap.

4. Lack of motivation to learn digital skills

On average, only 15% of the world’s employees are actually engaged. That’s a disheartening statistic that has a real financial impact on businesses. A disengaged workforce is a less fulfilled workforce, and subsequently less efficient, less likely to hit deadlines, and less likely to produce top-notch results. A single disengaged employee can cost a business in the United States around $11,358.

Disengaged employees are also less likely to want to improve their digital skills. They might not see the benefits of doing so, or feel detached from their position in the company, and it’s up to HR staff to find a personalised motivation for these individuals. Some workers need structured training to maintain their enthusiasm, whilst others need to know how a skill will benefit them in and outside the workplace, or the specifics of how a tool works.

5. Lack of time to learn digital skills

Some workers might also feel as though they just don’t have the time to invest in learning new digital skills—particularly if they feel overwhelmed by the sheer amount of training required, or have struggled with more formal modes of learning in the past.

Traditional learning programs can be off-putting to employees working with tight deadlines, commitments outside of work, or disabilities, who may assume that courses are time consuming and intensive.

6. Lack of interest in learning digital skills

A disinterest in digital skills can, unfortunately, start young. The number of students studying IT at GCSE level has plummeted by 40% since 2015, and fewer young people are opting to study IT at A-level, too. As a result, less than half of the UK’s employers believe that students leave full-time education with sufficient digital skills.

Existing employees might consider skills training superfluous to their role or beyond the purview of their personal interests, and dismiss upskilling opportunities as unnecessary.

7. Lack of awareness of the benefits of digital skills

It’s downright impossible to imagine a life without the technology we have today. Younger workers tend to be more familiar with emerging technologies than their older counterparts, so it’s important to provide support to anyone who’s unfamiliar with their company’s most frequently used tools.

However, familiarity with tech doesn’t always result in efficient use of the tech. Students and graduates may be familiar with popular tools (ranging from social media to industry specific CRMs), but might not know how to utilise them to their full potential, or as part of a professional group.

8. Fear of change

Businesses can take their pick of countless tools today, ranging from financial and payroll services, content management systems, design and illustration programs, and more. Candidates need a baseline understanding of their chosen industry’s most prolific programs and software to appeal to employers—but keeping up with the constant influx of tools can be overwhelming.

Workers might also worry that the tools or skills they’ve relied upon in the past are no longer in demand. Nobody likes to feel as though they’re behind the curve, after all, and it’s easy for these individuals to feel lost. Some employees may resist upskilling if they’re worried that the training will be too complicated, and others may have concerns about upskilling resulting in them being assigned a new role or responsibilities.

9. Resistance to new technologies

New software and tools are developed to help us do our jobs more effectively and cut out monotonous drone work. The sheer scope of what new technologies can achieve is intimidating to some, however, who might be overwhelmed by how much these tools will demand of them and their existing skill sets.

Reluctance to adopt new technologies has an adverse financial impact on businesses—workers ultimately spend more time completing tasks that could be automated, reducing efficiency.

10. Inadequate digital infrastructure

A lot of us take our access to digital tools for granted. Unfortunately, there are folks who can’t use new technologies as easily, or frequently, as we do. Minorities and people living in developing nations don’t enjoy technological equity, and can feel alienated by the rapid pace of digitalisation and ever increasing employer demands for digital literacy.

Similarly, women tend not to have the same access to technology as men. In 2017, it was reported that women are 7% less likely to own a smartphone than men, and that 12% more men use the internet. This disparity between who can use digital tools and who can’t will only widen the skills gap—and the effects of the gap will, in turn, be felt most sharply by those deemed unskilled and without consistent access to training or resources.

What are the effects of the digital skills gap?

Businesses across the UK are rightly concerned about how they’ll be affected by the digital skills gap. 79% of UK-based CEOs claimed that the diminishing availability of digital skills will hinder growth prospects over the next twelve months. After all, if you can’t source candidates with the skills necessary to the role, work process stall, standards slip, and innovation grinds to a halt.

Training an existing workforce is a huge task—but hugely beneficial. Companies that fail to keep up with training demands will find it harder to upskill as time goes by, may be outpaced by companies that do have learning programs, and struggle to attract candidates who are eager to hone their skills as part of a company that’ll value their motivation.

Below are a handful of key statistics that provide an insight into common consequences of the digital skills gap.

1. 87% of companies say they have skill gaps, or expect to within a few years (McKinsey Global Survey)

The skills gap affects businesses in all sectors as they struggle to attract and retain employees with digital skills and competencies. The McKinsey survey also states that businesses are aware that finding a solution to the growing demand should be a nationwide priority. It’s also worth noting that UK businesses also report that existing roles are being disrupted by fresh trends that demand proficiency in new skills, and that employees may have trouble keeping up.

2. $11,358: that's about what a disengaged employee costs in the U.S. (Gallup, LinkedIn)

Engaged employees are connected to their roles and proud to represent the company. They’re the people who come up with exciting ideas and novel ways to use digital tools. Disengaged employees, on the other hand, tend to lack passion and energy, and often feel demotivated. Today, engagement rates are pretty dismal and have an equally grim financial cost to companies—disengaged employees tend to be 18% less productive, costing employers around $11,358 every year.

3. 85% of users lose at least 1-2 hours of productivity each week searching for information (Dynamic Signal)

If employers don’t provide workers with reliable access to training materials, documented processes, or a company knowledge bank, then workers have no choice but to troubleshoot issues themselves—and that’s a time consuming task. It’s a common occurrence, too, as Dynamic Signal claims that around 36% of employees don’t know where to find information vital to their jobs. This lack of information, and poor internal communications, can lead to an overall drop in productivity.

4. 82% of companies recognize the role that employees' digital experience plays in business performance, rating it as "very important" to "vital" (Nexthink - Vanson Bourne)

The digital experience plays an important part in our working lives, whether you’re using a CRM, a video conferencing tool, or HR system. The government has stated that 82% of jobs in the UK list digital skills as a requirement—and that these jobs tend to pay 29% more on average, underscoring the apparent value of the digital experience. Despite this incentive, however, employers still struggle to recruit, as candidates cannot meet the skill requirements.

5. 49% of users prefer to learn at the point of need and 58% prefer to learn at their own pace (LinkedIn)

We don’t all learn in the same way or at the same pace, and employees want variety when it comes to upskilling. LinkedIn’s report underscores this, as well as the importance of personalised learning plans and reliable access to courses, resources, and documentation. Microlearning methods allow employees to self-pace their learning experience and apply new insights to processes they’re already familiar with.

6. 56% of employees believe that they don't have the skills required today to master digital technologies (Randstad)

A recent report from Randstad claims that workers in the United States aren’t feeling confident about how they’ll handle continued digitalisation—a statistic that reiterates how important it is that employers offer consistent training and support. Employees may already feel overwhelmed with the amount of tools and skills they’re expected to be proficient in, they may also be unsure who to ask for help, or feel strapped for time, but overall, most workers still recognise the importance of upskilling.

What are some strategies to bridge the digital skills gap?

Bridging the skills gap should be a priority for every company—though you might wonder whose responsibility it is to do so. The answer is that it’ll ultimately take a combination of private and public sector businesses, educational institutions, and motivated individuals.

With that being said, there are a number of key tactics that any company can use to reduce the digital skills gap amongst its workforce.

1. Offer training and development opportunities to employees

In a PWC Workforce of the Future report, 74% of respondents said that they were willing to upskill or re-train to remain employable. Today’s workforce clearly wants to improve their digital skills. To facilitate this upskilling, employers should be offering training to new starters and existing employees.

On-the-job training is a huge benefit for employees who are interested in boosting their digital literacy but worried about the time-consuming nature of traditional courses. Flexible training, as well as an accessible bank of knowledge and resources, ensures that all workers are equipped with the knowledge and skills they need to do their jobs, and shows a commitment from employer to employee.

2. Use technology to automate repetitive tasks

Nobody wants to be stuck doing drone work when we have technology that can do it for us. With automations, you can ensure that important administrative work is completed whilst freeing up time for employees, who can go on to complete high-value activities, training programs, or simply hit their deadlines more comfortably.

Automation is used across sectors to reduce human error and streamline, and document, working processes—think automatic email replies, chatbots with pre-set conversational pathways, and even onboarding systems that distribute employee details across different platforms without repetitive manual input.

3. Encourage employees to learn new skills

54% of employees need serious reskilling according to the World Economic Forum. New skills don’t just benefit businesses, either, and can actually have a lasting impact on an individual's career progression by giving them a more solid understanding of emerging technologies. Providing employees with chances to upskill is vital, and can also prevent economic stagnation and high rates of disengagement.

Employees can be encouraged to pick up new skills in all sorts of ways—and variety is important. Some workers may prefer a guided approach to learning and respond well to mentoring or coaching, whereas others may prefer self-guided courses, or to attend seminars or off-location events. Regardless of the methods, employees need to feel confident that their desire to upskill will be met and rewarded by their employer, and employers should make it clear to all employees which skills are in demand.

4. Implement a mentorship program

Mentors have a wealth of knowledge and experience that is hugely beneficial to new starters, and can give more personalised feedback to anyone shadowing their day-to-day practises or being taught the ropes of new tools. Mentoring is also a relatively resource-light way to begin offering training if your company is currently unable to invest in more traditional training.

All mentors should maintain clear lines of communication with their mentees, hold plenty of one-to-one meetings to track development, and encourage feedback, which can be used to refine the mentoring process or even contribute to future training packages.

5. Offer digital literacy courses

Courses are a classic way to provide training to lots of employees at once, and employees will be able to monitor their own progress and even earn certifications and micro-credentials. Some courses can even be tailored to suit your company’s goals and toolset. It’s even possible to develop an entirely bespoke knowledge hub (full of useful resources) or online learning platform, or invite employees to enrol in self-paced courses overseen by a member of their department’s management team.

6. Use data to identify skill gaps

A business will need to know which skills are in demand in order to close the skills gap. Once you have identified which skills are missing from your current workforce, or which need strengthening, it’s much easier to create targeted recruitment campaigns, or even highlight existing employees that could flourish if provided with training.

Only 50% of organisations today actually analyse their skill gap with data, and that puts them at a significant disadvantage when compared to organisations who have done their homework. To properly analyse the skills gap, you’ll need people data pulled from a variety of sources. Assessments and surveys are a great way to get direct feedback from staff, and competency matrices and performance metrics can also be used to determine the current skill level of a workforce and determine where there’s room for improvement or talent shortages.

7. Provide employees with access to learning resources

Employees should feel empowered to push their personal development—and they’ll need access to learning resources to do so. These resources can be delivered via a cloud-based LMS platform with curated courses and learning plans (either curated or bespoke). These platforms offer a simple user experience for staff, and ensure that important resources are readily accessible at any time, anywhere.

Having an accessible hub of resources also lets employees revisit materials when they need to. Maybe they’re trying to troubleshoot a complication or need to remind themselves about the steps of a key process (like uploading content or client communications). Free access boosts knowledge retention and compliance, and offers employees a way to complete their training without time constraints.

8. Encourage a culture of lifelong learning

Learning should be a lifelong commitment to development as an ongoing process, not just a one-off goal. It might seem a little daunting, but it’ll prove important as technology continues to advance and evolve in ways we can’t yet predict. However, a Learning and Work Institute report found that 60% of businesses are convinced that reliance on digital skills will soar over the next five years.

Employees who have been encouraged to take a committed attitude towards learning are more likely to embrace opportunities to upskill and less likely to drag their heels when it comes to using new tools, and may stand out as managerial candidates further down the line.

9. Promote digital literacy among all employees

All employees need to be able to meet a company’s standard of digital literacy—which can be achieved by providing training to everyone, new starters and existing employees, that establishes a solid literacy baseline. The training program should also define what digital literacy means to your company.

For example, how you promote digital literacy will depend on how many digital tools your employees use in their day-to-day work. It’s also important to remember that not everyone starts at the same level when it comes to digital literacy. Training programs should consider that Millennials and Gen Z workers are likely more familiar with today’s technologies, and provide a more stepped introduction to important digital tools for those who need it.

10. Encourage employees to share their expertise

Employees will glean different insights from your training sessions that can prove massively useful if shared. Maybe they’ll confer on how to troubleshoot a shared obstacle, maybe they’ll compare ideas of sharing feedback; either way, the expertise that employees have shouldn’t be discounted as a valuable resource.

Employees should also be encouraged to share their experiences of the business or industry as a whole, as well as the intricacies of their individual roles. Structured video conference sessions (supported by collaborative whiteboard apps like Miro), designed to facilitate knowledge sharing, are a relatively cheap way to strengthen social bonds, promote innovation, and ensure compliance.


What is the digital skills gap?

Workers lack the necessary digital skills to meet recruitment demands that hinge on those skills. The demand for digital skills is far outpacing the number of workers in the UK who actually have them.

What are the causes of the digital skills gap?

Employees lack access to training; including courses, resources, and support from staff members. Without a clear learning pathway, employees continue to lack critical digital skills. Additionally, graduates are leaving university with basic knowledge of digital tools but often struggle to make the most of them in professional situations.

What are the consequences of the digital skills gap?

The skills gap leaves some employees feeling demoralised and disengaged at work, or afraid that they’ll find upskilling too complicated. Businesses may also suffer from reduced productivity and a slower software adoption rate. The economy is also impacted by the digital skills gap, and could miss out on $11.5 trillion in GDP growth (cumulatively) by 2028 if the gap is not addressed by G20 countries.

What are some strategies to bridge the digital skills gap?

There are a number of diverse and customisable strategies to bridge the skills gap. Training is vital, and automation can give employees more time to focus on projects and upskilling. Similarly, employees should be encouraged to share their knowledge and pick up lifelong learning habits.

What is the role of government in bridging the digital skills gap?

The government needs to invest in accessible training for people across all phases of their careers. The digital strategy unveiled at the 2022 London Tech Week left a lot of people disappointed—though it claimed a focus on developing AI, fast-track visas for international tech workers, and a greater focus on STEM subjects in schools. However, visas take a long time to process, ministers have quit since the summit, and technology demands are evolving so quickly that students may struggle to keep up in traditional education programs. To combat this, the government could offer free training, support, or resources, and help businesses offer similar programs to their employees.

What is the role of businesses in bridging the digital skills gap?

Businesses need to get creative when it comes to training employees and new starters—it can’t be left to schools or the government. Businesses should invest in personalised learning programs, experiential education, and automation, as well as on-the-job training via an LMS system or mentorship program. As a result, employees receive practical experience and can visualise how upskilling benefits their personal development.

What is the role of education in bridging the digital skills gap?

Education hasn’t kept up with the rapid digitalisation of the workplace. Digital skills should be taught more comprehensively across a variety of subjects, and schools should also become more invested in the economy by getting involved with apprenticeship programs and events designed to spread awareness about the skills gap. Informing students that the gap exists, and what they can do to get a head start on bridging it, is also key.

What is the role of individuals in bridging the digital skills gap?

Individuals can take their learning into their own hands. First, acknowledge that you’re affected by the gap and try to assess which skills you have and which you don’t. Once you’ve pinpointed your personal gap, you can enrol in training sessions or freelance gigs. Individuals should also take note of how they can make themselves desirable to employers with a strong CV and interview skills, and a demonstrable willingness to keep up with digitalisation.

What are the long-term effects of the digital skills gap?

Some estimates have suggested that the UK’s GDP growth could take a £141 billion hit as a result of the digital skills gap. Training new starters and upskilling existing employees is a huge priority, and will hopefully promote growth. The skills gap likely plays a part in stalling the restoration of the UK’s economy, thanks to its impact on business output and productivity. However, the digital skills gap can also inspire individuals and businesses to focus on their personal development, as a person and not just an employee, and pick up habits that’ll encourage curiosity and innovation, and lifelong learning skills.

November 25, 2021

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