Press release
Wednesday 6 May 2025
The UK economy could see an annual boost of more than £23 billion p/a from building the essential digital skills of the workforce, says major new research.
- The income potential of the workforce would grow by over £10 billion p.a. with a profitability increase of £8.5 billion to UK industry.
- Coming from leading industry skills coalition FutureDotNow and the Centre for Economic and Business Research (Cebr), this new research quantifies for the first time the economic impact of closing the workforce essential digital skills gap.
- FutureDotNow is convening a cross-sector coalition of employers committed to action around the Workforce Digital Skills Charter.
- New FutureDotNow Calculator enables member organisations to measure the financial benefits of improving their employees’ essential digital skills.
The UK is facing an urgent challenge: over half of working-age adults (52%) cannot complete all 20 basic digital tasks industry and government agree are essential for work1.
The gap is everywhere: it’s in every sector, every region, every demographic including those groups you don’t expect: One in two young people can’t do all of these 20 tasks. One in two academics – people with a degree, a PhD can’t do all 20. One in three people earning over £75k. And shockingly, one in five people in TECH – 20% of the tech sector haven’t got all the essential digital skills.2
At the current pace, it would take more than 25 years to close this gap.
On a mission to remedy this issue, digital skills charity FutureDotNow has published ‘The Economic Impact of Closing the Workforce Essential Digital Skills Gap’ (link live Wednesday), a new report that sets out the fiscal gains to be made from powering up the UK workforce with essential digital skills.
This is the first report looking specifically at the economic impact of essential digital skill levels in working age adults, and has been developed in partnership with the Centre for Economic and Business Research (Cebr) – sponsored by the office of the National Technology Adviser within the Department for Science, Innovation and Research.
The report sets out a clear potential boost to the UK economy, productivity benefits for industry and a boost in both employment opportunities and personal prosperity for individuals.
Holly Chate, COO of FutureDotNow comments: “We’ve always felt confident that investing in these very basic digital skills would deliver returns to business, but we’ve never had any hard data on it – and not having data matters. Because if we can’t quantify it, then we can’t value it. And if we don’t value it, then it’s much easier to ignore… By ignoring it, not only does the opportunity remain hidden, but so does the risk. It’s highly likely that many organisations are developing products and services, and putting those out to millions of people who simply don’t have the skills to make use of them”.
Technology Minister Baroness Jones shares: “As this report shows essential digital skills are no longer optional – they’re the foundation for productivity, growth, and inclusion. Closing the UK’s digital skills gap will boost wages, business performance, and national prosperity, while opening up new routes into work.
That’s why we’re taking action by supporting local training initiatives and providing devices for those most in need through our Digital Inclusion Action Plan – working with industry and local communities to build a more digitally confident workforce and unlocking the benefits for our economy”.
Achieving full digital upskilling (i.e. every worker being able to execute all 20 essential digital skills for Work) is estimated to uplift Gross Value Added (GVA) by over £23 billion annually.
Business profitability, approximated by Gross Operating Surplus (GOS), could increase by nearly £9 billion.
Chintan Patel, Chief Technology Officer for Cisco UK and Ireland says: “All businesses want to see ROI on any investment. Digital skills are no exception. This research is critical for ensuring organisations – of any size – can understand and quantify the impact and value of digital skills to facilitate long-term growth, innovation, and competitiveness”.
Additionally, workers currently with lower levels of digital skills could see an average pay uplift of approximately £897, with a larger uplift in regions like London and the North West, and among mid-sized firms and high-skilled service sectors.
A construction organisation based in the North-West employing 100 full-time workers with low digital skills could increase its annual output (GVA) by £300k and its annual profits (GOS) by £100k from all workers learning to do the 20 Work Essential Digital Skills.
Aurelie Marais, Head of Strategy & Transformation, Sizewell C Civil Works Alliance comments: “With over 65% of the construction workforce lacking essential digital skills, the challenge is clear. We’ve never been able to quantify the benefits of basic digital skills until now. This research provides the data necessary to build a compelling case for investment – a vital step toward unlocking the potential of digital to improve productivity in construction”.
What’s more, enhanced digital skills raise the likelihood of employment by 0.21 percentage points per additional skill point.
In a scenario where all currently under-skilled workers are upskilled, an estimated 12,336 unemployed people could gain jobs, with aggregated earnings of £260 million per annum.
Dr Dave Smith, National Technology Adviser shares: “This report makes it crystal clear: investing in essential digital skills delivers real benefits for individuals, for businesses and for our economy. As technology reshapes every sector, businesses without basic digital capabilities risk being left behind. More importantly, individuals will also be left behind. That’s why building essential digital skills in their workforce must be a strategic priority for business – set targets, commit resources, and hence deliver results to create inclusive growth”.
Liz Williams MBE, Chief Executive of FutureDotNow adds:
“A truly modern digital economy is underpinned by digitally capable and confident workers. For too long the essential digital skills gap in the workforce has been hidden in plain sight. More than half of us are digitally under-powered and facing a world of work transformed by AI and automation.
We need a great digital catch up. Core digital capability isn’t something people simply acquire through use, it requires concerted attention. And, as this new FutureDotNow/Cebr report shows, the economic prize is significant. For individuals, for businesses and for the UK economy, the benefits each year run to the tens of billions.
It’s not about whether we can afford to do it — but rather, can we afford not to?”.
This changing face of work thanks to AI and automation adds enormous urgency to building a digitally confident and competent workforce.
Peter Cheese, CEO, CIPD says: “The average half-life of job skills is now estimated to be around 4 years and falling, largely driven by technology impacts in the workplace. In other words, half of your job skills are likely to become redundant in the next 3-4 years. That puts a huge emphasis on reskilling and upskilling, and in the UK we have been falling behind in investing in skills at work, and we don’t have a strong culture or support for lifelong learning.
We also know that too many people are working in jobs where they’re not using their skills effectively and they’re not seeing development. With the revolution of AI we have an unparalleled opportunity to design for better jobs, jobs for the future, that are more inclusive, better for our wellbeing and where we can be more productive and we can thrive, as both individuals and organisations”.
Phil Smith CBE, Chair of Skills England & Chair of the Digital Skills Council concludes: “The reality is that it is a complicated system. We’ve got 1 in 8 young people who are not in employment, education or training; we’ve got around 4 million people on disability benefits many of whom, I am sure, would like to find a job that’s right for them; we’ve got 2 or 3 million people who left the workforce at the older end post-Covid. There’s got to be an opportunity to make more people economically active and hence grow the country overall and grow the benefit that accrues to everyone as a result. We need to find ways of simplifying access to skills and particularly digital skills… And we have to collaborate: there’s more to be done here if we do it together. That’s really hard but really important – I’m not sure we’re going to crack it otherwise”.
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Notes to editors
Additional Commentary
Peter Cheese, CEO, CIPD: “One of the challenges we’ve faced for a very long time is our inability to effectively understand future job demand and then match it with the skills supply system, and there are problems on both sides. We have a fragmented adult skills supply system, with regular policy changes or new initiatives, and many organisations struggle to understand it. We need Government to work collectively across the many different policy areas that should coordinate from DWP, DfE, and DSIT looking at future skills, and DBT so it links to industrial strategy. Employers would also benefit from more consolidated frameworks that help to define and understand skills, from basic employability skills through to digital and even AI skills becoming more important for the future”. We can see that work emerging now for example through the work of FuturedotNow and programmes such as BridgeAI funded by InnovateUK and we need to get behind these to promote a more consistent language of skills for individuals and employers alike. The new SkillsEngland body will hopefully play a significant role in helping with these challenges.
“The average half-life of job skills is now estimated to be around 4 years and falling, largely driven by technology impacts in the workplace. In other words, HALF of your job skills are going to become redundant in the next 3-4 years. That puts a huge emphasis on reskilling and upskilling, and in the UK we have been falling behind in investing in skills at work, and we don’t have a strong culture or support for lifelong learning.
“We also know that too many people are working in jobs where they’re not using their skills effectively and they’re not seeing development. With the revolution of AI we have an unparalleled opportunity to create better jobs for the future. But we have consciously got to design for jobs which are good for people based on good work principles – something we’ve also laid out – where ultimately we are creating better work which is more inclusive, which is better for our wellbeing (there’s far too much stress in our workplaces currently) and where we can be more productive and we can thrive: as organisations and as individuals
“We will also have to ensure that everyone has the essential digital skills and employability skills we need today to help them grow into those jobs, ensuring a just transition to the future and not leaving people behind.”
Holly Chate, Chief Operating Officer, FutureDotNow: “We have lots of data on the size of the gap already… 52% of working age adults don’t have these 20 skills. The gap is everywhere: it’s in every sector, every region, every demographic including those groups you don’t expect: 1 in 2 young people can’t do all of these 20 tasks. 1 in 2 academics – people with a degree, a PhD can’t do all 20. 1 in 3 people earning over £75k. And terrifyingly, 1 in 5 people in TECH – 20% of the tech sector haven’t got all the essential digital skills.
“At FutureDotNow we’ve always felt confident that investing in these very basic digital skills would deliver returns to business, but we’ve never had any hard data on it – and not having data matters. Because if we can’t quantify it, then we can’t value it. And if we don’t value it, then it’s much easier to ignore… By ignoring it, not only does the opportunity remain hidden, but so does the risk. It’s highly likely that many organisations are developing products and services, and putting those out to millions of people who simply don’t have the skills to make use of them”.
Maura Jarvis, Partner and Workforce Transformation Leader at Mercer: “It is vital for the success of the UK economy to ensure people are not left behind. They need to be equipped with the necessary digital skills to succeed. Employers have a role to play in this by ensuring they have a data-led view of their current skills levels, skills needed for the future and upskilling programmes in place to close the skills gap.
“We need to really understand the level and capability of people across digital skills. One of the biggest gaps in HR is taking people’s word for how competent they are in these digital skills instead of actual evaluation, and that needs to change.
“Digital skills should be seen as vital to the UK’s future productivity, allowing us to take advantage of the opportunities technology provides”.
Dr Matthew Forshaw, Alan Turing Institute: “At The Alan Turing Institute, we work to address the skills challenges which inhibit the safe and responsible adoption of AI. If we are to achieve this, we cannot overlook digital skills and digital literacy. A major obstacle to the safe and effective adoption of AI is the lack of awareness around end users’ digital literacy. Systems are being built today which underestimate those challenges. They are too complex. They’re opaque in their nature, and they’re misaligned with the digital confidence of end users. Meanwhile, we’re seeing AI being embedded at pace within tools and office productivity suites. Where maybe a year or two ago, the use of AI tooling was an overt choice that someone would make, now it’s deeply entrenched in a lot of the work that we do and often in quite a transparent way.
“As AI continues to shape the way we work and live, ensuring everyone has the skills to critically evaluate the benefits and limitations of AI within their lives and livelihoods is essential. It is for those reasons why, over the last 18 months, we’ve collaborated very closely with FutureDotNow to make sure that our efforts are aligned and really maximise our impacts.”