How can the EU create a Digital Decade?

In 2021 the European Commission announced the Path to the Digital Decade, a new strategy and set of metrics to help support the European Union’s wider digital transformation. With goals ranging from quantum computing to increasing the share of female ICT specialists, it sets out a broad vision of what it considers will be needed to take full advantage of digital tech.

Last week, we published a new report commissioned by Amazon Web Services (AWS) that looked at the potential of the EU’s Digital Decade. As part of the report, we produced new estimates of its potential economic impact, and polled over 6,800 citizens and 7,000 businesses to look at the opportunities and barriers to greater use of tech.

You can find the full report and findings here, but here are five things that jumped out at me as particularly interesting:

The future is uncertain.

We often think of technological progress as progressing on a relatively straight line – at least compared to the relative chaos of economics of politics. Moore’s Law and other similar trends mean that we can rely on our devices getting steadily more powerful, faster and better connected with each passing year.

Increasing computer power, however, means little if you don’t have economically or socially valuable ways to use it.

In our modelling, we saw however that there was a huge range of potential outcomes. In principle, the Digital Decade goals could unlock over €2.8 trillion in economic value by 2030.

In practice, at current rates of progress, the EU is only on track to unlock around €1.3 trillion – with progress in areas like digital skills or cloud adoption lagging behind the kind of pace that will be needed to hit the full goals by 2030.

Having your own Silicon Valley might be nice – but it’s not the main way to benefit from digital technology

IT is a General Purpose Technology (GPT) – it benefits all parts of the economy. The steam engine was not transformational because it boosted the profits of engine manufacturers – but because it revolutionised productivity in sectors from transport to textiles.

In the same way, the total benefits of digital technology are likely to be far broader than those flowing to what we traditionally think of as ‘tech’ companies. This is likely to be even more true with the next wave of technologies, such as machine learning or IoT which could be particularly impactful in traditional strengths for the EU economy, such as automotive or agriculture.

One comparison we looked at in the report is what would happen if the EU tech sector became as relatively successful as that of the US – we calculate that would boost the overall economy by just 2%, or over 8x less the total potential value that could come from the wider Digital Decade agenda.

There is still a long tail of companies not taking full advantage of core technologies.

It’s easy to focus on the next big technology: blockchain, Edge computing, or 6G. But in reality, the European Commission’s own data shows that there is still relatively low uptake of existing technologies such as cloud (26%), AI (25%) or big data (14%).

Our own business polling data showed only a minority of businesses were using online tools for basic functions like project management (27%), invoicing (45%) or customer support / customer relationship management (31%)

A range of different studies has shown that even these relatively basic technologies like CRM or online accounting can boost business productivity by 10-25%.

Most workers are not taking full advantage of the computing power they have access to.

While 65% of parents told us that they thought it was important for their child to learn how to program, just 13% of Europeans as a whole said they had written any code in the last three months.

This is not just about code though: just knowing how to better use the everyday tools of a knowledge worker like a spreadsheet or search engine can significantly boost productivity. In one interesting recent finding, over 40% of workers who use office software daily still do not have sufficient skills to use it effectively.

In our own polling, only half of Europeans (52%) said that they would feel confident creating a spreadsheet to track their budget.

There is much less of a demographic divide for Digital Government services than you might think.

One long standing narrative about digital public services is that they might be all very well for the young, but older generations find them confusing and harder to use.

By contrast, in our polling across different age demographics we found a majority saying both that they found their government’s websites or apps easy to use, and that they were confident that they could find information or a service through them.

What is more when we asked about comfort with specific digital government services, we found relatively little differences across ages. Those over 65 were actually more likely than the under 25s to say that they would comfortable using a website or app to book a medical appointment or pay their taxes.  What is more, 95% and 92% respectively of those over 65 who had used those particular services said that they found them helpful.