Improving next generation's tech literacy could add £11 billion to UK GDP

14 December 2017 7 min. read

A new report into tech literacy has shown that the next generation could bring in an additional £11 billion to Britain’s GDP growth, if they are properly trained and utilised in the future economy. However, four in every ten of the emerging generation of workers adequately grasp how technology stands to change their future jobs, as corporate leaders call for cross-societal efforts to ensure these individuals are brought up to speed, amid a constantly changing job market.

Multiple studies have suggested that modern technology could alleviate economic disadvantages, with papers previously claiming that global internet inclusion could lift 500 million out of poverty and increase global economic activity by $6.7 trillion. However, in Summer 2017, the UK’s leading digital inclusion charity, the Good Things Foundation, suggested that in Britain alone, as many as 7.8 million people do not use the internet in any way, while 7.4 million people are “limited” users who barely make use of it. The paper, backed by BT, suggested that major changes would be needed if the potential of the internet and digital technology were to be realised.

Now, in a new paper, BT researchers have partnered with analysts from consulting firm Accenture to explore the relationship between tech literacy and social mobility in the UK. The study gathered primary data from 4,000 young people aged 16 between 24, along with 1,000 individuals from Generation X, aged 41 to 50, to provide a point of comparison with individuals further along in their careers. The sample was selected to reflect the UK’s diverse educational, occupational and income groups.

Generation Xers already demonstrate the value of technological know-how, with higher levels of capability currently earning them more as their careers progress. Gen X sees an average ‘tech literacy wage premium’ of £10,000 per annum, versus those with lower levels of skills. According to the estimates by Accenture and BT, the emerging workforce of the coming years could see an even greater boon thanks to these skills, however. If young people could improve their skills as they hope to, and these skills were matched with suitable jobs, the implied increase in salaries could add approximately £11 billion to UK GDP by 2022.Emerging workforce tech skills level and ambition to improve in five years

As arguably the first ‘tech-native’ generation to have grown up using computers and the internet, the emerging workforce are largely confident users. Most young people have strong foundations to build on when it comes to technological knowledge, and are often keen to improve. While just 4% are highly skilled today, that figure could well rise to 22% by 2022, on the back of high competence rates. 73%, or just under three quarters of young people presently rate themselves as ‘confident’ users of tech or above, demonstrating a solid base level of capability. By 2022, in that case, ‘competent’ users would be the least common variety of technology user, at just 13%.

New opportunities

This vast improvement of the next generation’s computer literacy could also see significant economic opportunities arise for individual young people and UK companies. Most young people believe that better tech skills bring in more ample financial rewards, with top performers – young people who aspire to be ‘creative’ or ‘expert’ users of tech in five years’ time – also expect their future salaries to be approximately 20% higher than those who expect to be ‘competent’ users. Expert users presently expect their salary to be around £34,609, while creative users actually expected their salary to be slightly higher at £34,949.Emerging workforce 2022 salary expectationsWhile this potentially reflects changing generational values, in which the newer generation have a greater desire to create, having grown up in the user-generated-content era of Web2.0, the reality is that experts will almost certainly be paid a handsome amount more than creatives. Evidence from Generation X respondents does show that those who consider themselves ‘expert’ or ‘creative’ users of tech reported higher average annual salaries than ‘competent’ users.

However, experts take home an average of £45,521 per annum, £10,000 more than competent users, with the average digital role for technology workers in the UK presently being advertised for £51,000 – 44% higher than the national average. Contrastingly, despite their significantly improved skillset, creative users, boasted an annual income less than £3,000 higher than competent used, earning £37,847 a year on average.

Generation X average current salary by tech skills levelRegardless of the wage disparity between differing levels of technical prowess, the report finds that young people display mixed understanding of the impact tech could have on their futures. Importantly, 66% do agree that digital skills will be increasingly important to enable them to carry out their jobs, while 70% predict that they will help open job opportunities.

Underestimated change

However, only 60% of respondents realised technology stands to change the nature of whole industries in the next five years, and with it, a plethora of jobs emerging workers will compete for. According to recent studies, 5% of jobs can be completely replaced by technology, with over 60% of all work activities potentially becoming automated by 2055. In the US alone, the automation of up to 38% of American jobs could be completed by 2030.

Despite the increased importance of these skills in terms of employability, more than 40% of respondents still believed digitally skilled jobs consisted of sitting in front of a computer screen, rather than working with people, underestimating the all-reaching and transformative potential of new innovations that will likely become common practice in businesses over the coming decade. Meanwhile, only 57% percent see improving their tech skills as a “cool thing to do.” While asking young people whether they find learning of any sort “cool” might be leading – considering the majority of daily tasks successfully executed by any adult are not regarded as “cool”, but rather, “necessary” – the implication that a sizeable minority remain ambivalent about skills that may be essential to surviving a coming market realignment, as AI and automation restructure the global economy – is a troubling one.Emerging workforce attitudes towards technology and skills (agree/strongly agree responses)Speaking on the results of the survey, Gavin Patterson, BT Group CEO, said, “It’s clear that we need to build a culture where young people see tech know-how as the new way to get ahead. That goes much further than a single-minded focus on coding – it’s about creative problem-solving based on digital capability. This has to be a shared agenda. We must work together across business, government and civil society to bring young people from all backgrounds into the future workforce.”

Olly Benzecry, Chairman and Managing Director, Accenture UK and Ireland, added, “There’s no single answer to this challenge. We need a combination of access to training, deeper understanding of the relevance of tech to our future, and a cultural shift in attitudes towards it. And there’s no single body responsible for taking action – we all have a role to play, as the private sector, as government, as educators and as parents.”