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Investment in digital skills could contribute an extra €9.5bn to GDP over 3 years

Written by Robert McHugh, on 6th Apr 2022. Posted in Technology

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A report launched yesterday by Google confirms a substantial economic opportunity for Ireland exists if a meaningful investment in digital skills is made. The study developed in partnership with Amárach provides detailed insights into the digital capability needs, ambitions, and plans of 1,000 SME leaders throughout Ireland. The research proposes that a significant investment into digital skills could contribute an extra €9.5 billion to Ireland’s GDP by 2025. 
 
The report finds that only 11% of Ireland’s SMEs feel their employees have the skills needed to successfully adopt and use new technology, a statistic borne out in the data where only 53% of SMEs have (or use) social media and video platforms and just 18% make use of customer insights tools. When measuring the number of SMEs that have their own business website, Ireland at 55% ranks comparably lower than the EU average of 77%.

The research shows that Irish SMEs are ambitious when it comes to investing in digital capabilities but 50% say they lack basic knowledge about which skills to prioritise. The report indicates that policy makers, advisors, and suppliers to the SME sector need to help address the priority gaps that will deliver quick wins, spurring decision makers to go further.
 
Most Irish SMEs are in the process of adopting, developing, and evolving their use of digital technologies. But some are further ahead in the process than others. When asked to rate their own progress, the majority (62%) of Irish SMEs are ‘less than halfway’ on their digital journey. Recruiting people with the necessary digital skillset is also a challenge for Irish SMEs with 41% of respondents agreeing that they do not have a person within the organisation who is tasked with developing digital skills. Only 26% of SMEs say their employees have all the skills needed in terms of basic digital capabilities.
 
Irish SMEs are very confident (56%) that meeting their digital skills objectives could make a big difference to business performance, and not just on one or two metrics. SME leaders believe that improving digital capabilities would allow them to increase wages and salaries (28%) and over half of those surveyed (57%) say that meeting their objectives [in digital capabilities] would help them to grow faster and become more profitable.

Fiscally, the study proposes that an increased investment in digital skills could grow Ireland’s GDP significantly, calculating an increase of €9.5 billion (to €544.2 billion) by 2025.
 
Commenting on the research, Director for Small Business at Google, Alice Mansergh said, "The timing of this report could not be more important, the decisions that business leaders and policy stakeholders make about digital capabilities in the coming months and years will have profound implications for the long-term productivity and profitability of the SME sector, and for sustainable economic growth over the rest of the decade."
 
Chair of Amárach Research, Gerard O’Neill added, "The study is comprehensive, representing a cross-section of Irish SMEs and is nationally representative of regions, genders, industries and business models. While we see some subtle differences in the findings, two things are constant to almost all SMEs; first that they believe investing in digital capabilities will enhance their business and second that they are ready to do that now - but they need the right supports."

Source: www.businessworld.ie

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