Lorenzo Macchi
Research expert covering society, economy, and politics for Italy
Digitalization in Europe - statistics and facts
The digital transformation of the societies and economies of European Union member states is integral to their ability to compete economically on the world stage in the 21st century. The EU has launched several policy initiatives which aim to improve the digital connectedness of citizens, enterprises, and government institutions, with the aim of ensuring near-universal access to the internet and the development of skills with regard to digital technologies, both for the general public and for ICT specialists. An added impetus to the digitalization of Europe's economy is that the EU is typically seen as being behind the United States and China in the development of digital technologies and high-tech companies.
As digital technologies become more fundamental to the functioning of the world economy, the ability of European companies to connect with customers and partners across the world via the internet will be essential to economic growth. Investments in digital infrastructure, such as high-speed broadband, have become a greater priority for EU member states in light of their experiences during the COVID-19 pandemic, when the sudden shift to remote working highlighted many weak points in their current infrastructure. Many EU countries have therefore chosen to use the funds they will receive from the EU's post-COVID stimulus package, known as NextGenEU, to invest in their digital capacity, such as through developing their 5G networks, providing re-training for citizens to work in the digital sector, and funding for digital start-ups.
Although not all of this will be spent on digital investments, countries such as Germany, Spain, and Austria have stated in their national recovery and resilience plans published in 2021 that their main focus will be on digital infrastructure. The DEP will focus on five strategic areas during its implementation period: supercomputing, artificial intelligence, cybersecurity, advanced digital skills, and adoption of digital technologies.
In spite of relatively high unemployment in the EU and high-demand for skilled workers in these digital industries, many companies in Europe report a lack of qualified and experienced workers for their positions. This is a challenge for EU policymakers, as equipping European citizens with digital skills, both of basic digital literacy as well as more advanced skills, is essential to fighting unemployment and to growing the burgeoning European tech scene. Investments in retraining schemes, universities, and other vocational training is need to develop Europeans' skills in areas such as coding and programming, data analysis, digital marketing, IT security, and digital project management.
In spite of huge progress which has been made by member states in improving access to public administration online, there are still some lingering concerns among citizens, such as the technical problems with e-government websites and the ease of use of digital services. Some EU member states rank much more poorly in terms of digitalization of their public sectors, with Romania and Greece coming at the bottom of the European Commission's eGovernment Benchmark.
As digital technologies become more fundamental to the functioning of the world economy, the ability of European companies to connect with customers and partners across the world via the internet will be essential to economic growth. Investments in digital infrastructure, such as high-speed broadband, have become a greater priority for EU member states in light of their experiences during the COVID-19 pandemic, when the sudden shift to remote working highlighted many weak points in their current infrastructure. Many EU countries have therefore chosen to use the funds they will receive from the EU's post-COVID stimulus package, known as NextGenEU, to invest in their digital capacity, such as through developing their 5G networks, providing re-training for citizens to work in the digital sector, and funding for digital start-ups.
The Digital Europe Programme: modernizing Europe's economy for the 21st century
The Digital Europe Programme (DEP) is the European Union's current funding program which looks to support the development and adoption of digital technologies. The DEP provides grants, procurement, and other financing methods for projects looking to develop digital services and capacity in Europe, embedded in the EU's Multiannual Financial Framework (MFF) for 2021-2027. Initially promising 7.5 billion Euros for the period, this amount has been substantially enlarged by digital investments made using funds from the EU's NextGenerationEU economic recovery package, worth a combined total of 800 billion Euros.Although not all of this will be spent on digital investments, countries such as Germany, Spain, and Austria have stated in their national recovery and resilience plans published in 2021 that their main focus will be on digital infrastructure. The DEP will focus on five strategic areas during its implementation period: supercomputing, artificial intelligence, cybersecurity, advanced digital skills, and adoption of digital technologies.
Digital skills: preparing EU citizens for digital transformation
Since the latter half of the 20th century, most European countries have experienced substantial deindustrialization, with heavy manufacturing industries off-shoring to regions such as East Asia. The loss of manufacturing jobs, previously a large component of the European workforce, has meant that different skills are needed by European citizens to be able to thrive in the job market. Digital skills are key in allowing Europeans to find stable and well-paying employment in the growing industries of the technology and digital services sectors.In spite of relatively high unemployment in the EU and high-demand for skilled workers in these digital industries, many companies in Europe report a lack of qualified and experienced workers for their positions. This is a challenge for EU policymakers, as equipping European citizens with digital skills, both of basic digital literacy as well as more advanced skills, is essential to fighting unemployment and to growing the burgeoning European tech scene. Investments in retraining schemes, universities, and other vocational training is need to develop Europeans' skills in areas such as coding and programming, data analysis, digital marketing, IT security, and digital project management.
E-Government: technology and public administration
As well as the digitalization of their economies, EU member state governments are making large investments in integrating digital technologies and modernizing their systems of public administration, also known as 'E-government'. European countries such as Estonia and the Netherlands have become famous for their success in making the vast majority of their public services available to residents online, as well as for their e-residency programs. Other e-government measures taken in the EU include Denmark's national electronic ID system, Spain's electronic prescription system, and France's system of filing tax returns fully digitally.In spite of huge progress which has been made by member states in improving access to public administration online, there are still some lingering concerns among citizens, such as the technical problems with e-government websites and the ease of use of digital services. Some EU member states rank much more poorly in terms of digitalization of their public sectors, with Romania and Greece coming at the bottom of the European Commission's eGovernment Benchmark.
Lorenzo Macchi
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Jan 22, 2025
Lorenzo Macchi
Research expert covering society, economy, and politics for Italy
