How digital is your country? 2018 Digital Economy and Society Index shows Europe’s slow progress
On May 18, 2018 the European Commission released its 2018 Digital Economy and Society Index (DESI), showing that the EU is getting more digital, but progress remains insufficient for Europe to catch up with global leaders and to reduce differences across Member States. According to the index, Denmark, Sweden, Finland and the Netherlands scored the highest ratings and are among the global leaders in digitalisation. Ireland, Cyprus and Spain progressed the most (by more than 15 index points) over the last four years.
However, some other EU countries are far behind these results. The measurements of digitisation in the EU show that connectivity has improved, but is insufficient to address fast-growing needs. Though it is more common for Europeans to use internet to communicate and the number of digital specialists in Europe is growing, the digital skill gaps still remain. Moreover, while businesses are becoming more digital, e-commerce as a whole is growing slowly. At the same time, the figures show that Europeans use more often public administration services that are available online. These results call for a quick completion of the Digital Single Market and increased investments in digital economy and society (as expressed in the Communication presented on Tuesday). More information on 2018 DESI can be found in Q&A, and on the Digital Single Market in a timeline and in two factsheets (here and here)
Andrus Ansip, Vice-President for the Digital Single Market, said: “This is a shift, albeit small, in the right digital direction. As a whole, the EU is making progress but not yet enough. In the meantime, other countries and regions around the world are improving faster. This is why we should invest more in digital and also complete the Digital Single Market as soon as possible: to boost Europe’s digital performance, provide first-class connectivity, online public services and a thriving e-commerce sector.”
Mariya Gabriel, Commissioner for Digital Economy and Society, said: “We look forward to a rapid progress on major reforms such as the European Electronic Code aiming at boosting investments in enhanced connectivity. This year’s Digital Economy and Society Index demonstrates that we must deploy further efforts to tackle lack of digital skills among our citizens. By integrating more digital technologies and equipping them with skills, we will further empower citizens, businesses and public administrations. This is the way to succeed the digital transformation of our societies.”
Over the past year, the EU continued to improve its digital performance and the gap between the most and the least digital countries slightly narrowed (from 36 points to 34 points). Denmark, Sweden, Finland and the Netherlands scored the highest ratings in DESI 2018 and are among the global leaders in digitalisation. They are followed by Luxembourg, Ireland, the UK, Belgium and Estonia. Ireland, Cyprus and Spain progressed the most (by more than 15 points) over the last four years. However, some other EU countries still have a long way to go and the EU as a whole needs to improve to be competitive on the global stage.
DESI 2018 shows:
Connectivity has improved, but is insufficient to address fast-growing needs
- Ultrafast connectivity of at least 100 Mbps is available to 58 % of households and the number of subscriptions is rapidly increasing. 15 % of homes use ultrafast broadband: this is twice as high as just two years ago and five times higher than in 2013.
- 80 % of European homes are covered by fast broadband with at least 30 Megabits per second (Mbps) (76 % last year) and a third (33 %) of European households have a subscription (23 % increase compared to last year, and 166 % compared to 2013).
The number of mobile data subscriptions has increased by 57 % since 2013 reach 90 subscriptions per 100 people in the EU. 4G mobile networks cover on average 91 % of the EU population (84 % last year).
Indicators show that the demand for fast and ultrafast broadband is rapidly increasing, and is expected to further increase in the future. The Commission proposed a reform of EU telecoms rules to meet Europeans’ growing connectivity needs and boost investments.
More and more Europeans use the internet to communicate
The highest increase in the use of internet services is related to telephone and video calls: almost half of Europeans (46 %) use the internet to make calls, this is almost a 20 % increase compared to last year and more than 40 % increase compared to 2013. Other indicators show that 81 % of Europeans now go online at least once a week (79 % last year).
To increase trust in the online environment, new EU rules on data protection will enter into force on May 25, 2018.
The EU has more digital specialists than before but skills gaps remain
- The EU improved very little in the number of Science, Technology, Engineering and Mathematics (STEM) graduates (19.1 graduates per 1000 people aged 20 to 29 years old in 2015, compared to 18.4. in 2013);
- 43 % of Europeans still do not have basic digital skills (44 % last year).
Alongside the Digital Skills and Jobs Coalition, the Commission has launched the Digital Opportunity Traineeships to tackle the digital skills gap in Europe. The pilot initiative will provide digital traineeships for up to 6,000 students and recent graduates until 2020 in another EU country.
Businesses are more digital, e-commerce is growing slowly
While more and more companies send electronic invoices (18 % compared to 10 % in 2013) or use social media to engage with customers and partners (21 % compared to 15 % in 2013), the number of SMEs selling online has been stagnating over the past years (17 %).
In order to boost e-commerce in the EU, the Commission has put forward a series of measures from more transparent parcel delivery prices to simpler VAT and digital contract rules. As of December 3, 2018, consumers and companies will be able to find the best deals online across the EU without being discriminated based on their nationality or residence.
Europeans use more public services online
- 58 % of internet users submitting forms to their public administration used the online channel (52% in 2013).
- 18% of people use online health services.
In April 2018, the Commission adopted initiatives on the re-use of public sector information and on eHealth that will significantly improve cross-border online public services in the EU.
The annual Digital Economy and Society Index (DESI) aims to measure the progress of EU Member States towards a digital economy and society. It helps EU countries identify areas requiring priority investments and action. The DESI is also a key tool when analysing digital in the European Semester, which allows EU countries to discuss their economic and budget plans and monitor progress at specific times throughout the year.
This year, both DESI and the more detailed analysis of national digital policies, providing an overview of progress and of policy implementation by Member States (previously called Europe’s Digital Progress Report) are published jointly using the DESI name. A more detailed Telecoms Chapter for each Member State is annexed to the reports. To make better comparison between Member States, DESI also develops cross-country analyses in connectivity, skills, use of the internet, take-up of digital technology by businesses, digital public services, ICT R&D and innovation investment and use of Horizon 2020 research and innovation programme funds by Member States.
The Commission has presented 29 legislative proposals under its Digital Single Market strategy and called, in a recent Communication, the European Parliament and Member States to adopt these proposals by the end of 2018.
Strong labour relations key to reducing inequality and meeting challenges of a changing world of work – OECD & ILO
Globalisation and rapid technological innovation have spurred unprecedented economic growth but not everyone has benefited. Unions and employers, together with governments, can play a major role in making growth more inclusive and helping workers and businesses face the challenges of a changing world of work. Good labour relations are a way to reduce inequalities in jobs and wages and better share prosperity, according to a new OECD-ILO report.
Building Trust in a Changing World of Work finds that trade union membership is declining in a majority of countries, while in several emerging economies large shares of the workforce are still in the informal economy. The share of employees whose job conditions and pay are regulated by collective bargaining varies greatly across sectors and countries, from less than 10% in Turkey to over 90% in Sweden. Coverage of collective bargaining have also seen a marked decline in many countries over the last decades, although in some countries more workers are covered today thanks to decisive policy reforms.
“Creating more and better jobs is key to achieving inclusive economic growth. At a time marked by increasing job insecurity, wage stagnation and new challenges from the digital revolution, constructive labour relations are more important than ever,” said OECD Secretary-General Angel Gurría, launching the report alongside Swedish Foreign Affairs Minister Margot Wallström, French Labour Minister Muriel Pénicaud, ITUC General Secretary Sharan Burrow and ILO Deputy Director-General for Field Operations & Partnerships, Moussa Oumarou.
The report is part of the Global Deal for Decent Work and Inclusive Growth, an initiative launched in 2016 by the Swedish Prime Minister Stefan Löfven and developed in cooperation with the OECD and the ILO. This multi-stakeholder partnership aims to foster social dialogue as a way of promoting better-quality jobs, fairer working conditions and helping spread the benefits of globalisation, in keeping with the Sustainable Development Goals. The Global Deal has around 90 partners representing governments, businesses, employers’ and workers’ organisations and other bodies who make voluntary commitments to contribute to a more effective dialogue and negotiated agreements on labour issues.
“We are convinced that the Global Deal for Decent Work and Inclusive Growth can help to spur more and better social dialogue so we can provide all workers with strong voices, protection, fair working conditions and good levels of trust with employers,” Mr Gurría said.
“The new report shows that enhanced social dialogue can create opportunities for more inclusive labour markets and economic growth, better socio-economic outcomes and greater well-being for workers, improved performance for businesses and restored trust for governments,” said ILO Director-General Guy Ryder.
Some 2 billion workers around the world – more than half the global labour force – are in informal and mostly insecure jobs, according to the report, meaning they do not have formal contracts or social security. Annually there are 2.78 million work-related deaths and 374 million non-lethal work-related injuries and illnesses.
The report highlights the crucial role that unions and employers can play in shaping the future of work by jointly deciding what technologies to adopt and how, contributing to manage transitions for displaced workers, helping identify skills needs and developing education and training programs. The report also shows that when looking at the OECD Guidelines for Multinational Enterprises companies with a higher social score (a measure of their capacity to generate trust and loyalty among the workforce, customers and wider society) also have a stronger financial performance.
This report analyses the voluntary commitments made by Global Deal partners and gives examples of initiatives to improve labour relations that have been taken in different countries and sectors. More on the Global Deal: www.theglobaldeal.com