The European Commission published on July 28 the data provided by the Digital Economy and Society Index (DESI) for 2022, which aims to measure the progress made in the EU Member States in the field digital. According to this report, only 54% of Europeans have “basic digital skills” and while most Member States are making progress in their digital transformation, the adoption of key digital technologies by businesses, such as AI and big data, remains low.
It is thanks to DESI that the European Community can see the digital progress of EU Member States since 2014, the DESI 2022 reports are mainly based on 2021 data.
They show that, although during the COVID-19 pandemic Member States have made progress in their digitization efforts, they have not yet closed the gaps in digital skills, the digital transformation of SMEs and the deployment advanced 5G networks.
To support digital transformation, €127 billion has been earmarked by the EU for digital-related reforms and investments in national recovery and resilience plans. This investment aims to accelerate digitalisation, increase the resilience of the Union and reduce external dependencies both in terms of reforms and investments. Member States have dedicated on average 26% of their allocation to the Digital Transformation Recovery and Resilience Facility (FFR), above the mandatory threshold of 20%. The Member States which have chosen to invest more than 30% of their allocation in digital are Austria, Germany, Luxembourg, Ireland and Lithuania.
Margrethe Vestager, Executive Vice President for a Europe Fit for the Digital Age, says:
“The digital transition is accelerating. Most Member States are making progress in building resilient digital societies and economies. Since the beginning of the pandemic, we have made considerable efforts to support Member States in the area of transition, whether through the recovery and resilience plans, the EU budget or, more recently, structured dialogue on digital education and skills. Because we need to make the most of the investments and reforms needed to achieve the digital decade goals for 2030. So change needs to happen now. »
All EU countries have gaps in key areas
Even Finland, Denmark, the Netherlands and Sweden, which top the rankings in terms of digitization, have gaps in key areas: the rate of adoption of advanced digital technologies, such as AI and big data, is less than 30%, a long way from the 75% target set for the digital decade by 2030.
The adoption of digitization has nevertheless continued and the countries which were lagging behind in this area are gradually reducing it, such as Italy, Greece or Poland.
A lack of skills
On 9 March 2021, the European Commission presented pathways for Europe’s digital transformation and the 2030 objectives of the EU’s digital decade in 4 sectors:
- Computer skills;
- Secure and sustainable digital infrastructures;
- Digital business transformation;
- Digitization of public services.
DESI 2022 reveals that only 54% of Europeans aged 16-74 have at least basic digital skills, the digital decade target is at least 80% by 2030.
As regards information and communication technologies, 500,000 specialists have entered the labor market in the past two years. Thus, the EU now has 9 million ICT specialists, far from the target of 20 Ms of the digital decade and of being in sufficient numbers to fill the skills shortages faced by companies. In 2020, 55% of businesses in the EU reported difficulties in filling vacancies for ICT specialists.
These shortages are a major obstacle to the recovery and competitiveness of EU businesses.
Very low use of AI
Companies have stepped up their use of digital solutions during the pandemic, 34% of them have turned to the cloud, but only 14% have used big data and 8% have used AI, while the target for 2030 is 75%.
Yet these key technologies offer enormous potential for innovation and efficiency gains, especially for SMEs. Only 55% of them have reached at least a basic level of digitization, while the target is at least 90%.
A connection in progress but to improve
In 2021, gigabit connectivity has increased further in Europe: 50% of households have adopted fiber, global coverage by very high capacity fixed network has reached 70%, the objective being total coverage.
For its part, 5G coverage also increased last year to reach 66% of populated areas in the EU. However, the report points out that “ the assignment of 5G spectrum radio frequencies, which is an important prerequisite for the commercial launch of 5G, is still not completed: only 56% of the harmonized 5G spectrum has been assigned in the vast majority of Member States (Estonia and Poland are the exceptions)”.
Also, according to DESI 2022, some of the very high coverage rates rely on sharing 4G frequencies or low-bandwidth 5G spectrum, thus not allowing full deployment of advanced applications.
The digitization of public services in the EU
The online delivery of essential public services is commonplace in most EU Member States. In the context of the European Commission’s project to set up a European digital identity wallet, 25 Member States have implemented at least one electronic identification scheme, but only 18 of them have one or several electronic identification schemes compliant with European eIDAS regulations, which is an essential element for the security of cross-border digital transactions.