A failure to keep up with digital advancements and invest in digital skills could hamper the UK’s ability to compete economically on the world stage, according to new research from Barclays.

The Barclays Digital Development Index benchmarks 10 countries around the world on their readiness to compete in the digital economy. The study, which attributes an overarching ‘digital empowerment’ score to each nation, found that the UK came in just fourth place behind new and emerging ‘digital tiger’ economies Estonia, South Korea and Sweden. When it comes to individuals’ assessment of their own digital skills and confidence, the UK trails major economic rivals India, China and the USA.

The findings are based on a survey of almost 10,000 working adults combined with analysis of policy frameworks and support for the development of digital skills in each country. The research highlights a disconnect between policies to support digital engagement in the UK, which score well overall, and a lack of confidence in digital skills at an individual level among British workers.

Ashok Vaswani, CEO, Barclays UK, said: “The UK can become the world’s pre-eminent powerhouse of tech innovation and compete globally across all sectors and industries, but only if we significantly develop our digital skills and expertise.

“As the UK considers its future outside the European Union, we have to remember that the race to become the most digitally savvy economy is global and not confined to Europe. It is a race that will define how successful and prosperous we are for decades to come.

“The UK’s current strengths are clear: our children are being taught digital skills at school, the government’s policy is coherent and the private and voluntary sectors coordinate well. But the UK’s competitors in this race are developing faster and significant investment in digital skills is the only way for us to win it.”

While the UK ranks in 4th place in terms of support for the development of digital skills, performing well in selected areas of digital skills policy and advanced learning skills, these strengths are offset by relatively low capability and confidence in digital skills on an individual level where the UK ranks in 6th place behind some of its biggest economic rivals China, India and the USA.

Lack of skills posing security threat

The research highlights that UK confidence is particularly low when it comes to protecting data and devices. Workers in the UK are less likely to keep their phones and laptops secure than those in Brazil, South Africa or China, posing a potential risk of data leaks in the coming years as cyber hackers find increasingly sophisticated ways to access data.

• Only 13% of people in the UK use password-generating software to create hard-to-crack passwords, compared to 32% in China and 32% in India

• Only 41% of people in the UK change important passwords regularly, compared to 59% in India

• Only 38% of people in the UK never save or store payment information on online accounts, compared to 58% in South Africa

From consumers to creators

Perhaps the most concerning indicator is the fact that the UK ranks just seventh out of 10 for coding skills and content creation. This is a key indicator of the ability to be a ‘digital creator’ rather than just a ‘digital consumer’, posing questions about what impact this will have on the UK’s readiness to compete in the future digital economy.

• Only 16% of people in the UK would be very comfortable building a website, compared to 39% in Brazil and 37% in India

• Only 11% of people in the UK would be very comfortable creating a mobile app or game,compared to 22% in the USA, 27% in Brazil, or 33% in India

• Only 12% of people in the UK feel very comfortable creating a software programme or game, compared to 23% in the USA or 33% in India

Role of workplace training

The two leading countries in the index are ahead of the UK in the ranking for digital policies. Both Estonia and South Korea are particularly strong on vocational and workplace digital skills, while South Korea leads the way on broadband access policy and digital skills in compulsory education.

With the UK coming in seventh out of 10 for vocational and workplace skills, the research highlights a clear need for more to be done in the workplace to help boost digital skills. Estonia and South Korea, the joint leaders on digital empowerment, are also joint leaders on vocational and workplace skills. Only 38% of UK workers interviewed for the study say that their employer offers training in digital skills; this figure is considerably higher in China, the US (48% in both) and India (67%).

Ashok Vaswani continued: “In the previous century, most of us had to cope with just one big shift in technology in our career or lifetime, and we’ve been able to rely on our early education to get us through. But, now these changes are happening constantly though the evolution of the internet, smartphones, social media, and the advent of new technologies like blockchain, virtual reality, Artificial Intelligence and open data.

“This research shows Britons need to equip themselves with digital skills whether to future proof their career, or keep personal data and devices safe. Businesses also need to do much more to upskill each and every generation of their workforce; we need to create a new culture of lifelong learning. With the referendum sending a clear message that too many parts of the UK do not feel they are sharing in the promise of global prosperity, now is the time to take everyone forward together in the digital age.

“Our call to action is clear: in schools and workplaces across the country, we need to build digital skills and confidence that will turn digital consumers into digital creators.”

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From Inclusion to Empowerment: The Barclays Digital Development Index

Executive summary

As technology-led disruption of businesses and industries continues apace, workers in the UK and other developed nations are at risk. Their confidence in their digital skill levels is too low, despite several years of public and private sector efforts to boost them. In emerging markets, meanwhile, skills assessments and confidence levels are much higher than those in many advanced economies.

Rapid technological change means that the digital skills of most countries’ workforces will not keep them competitive in tomorrow’s workplace. Before long, being digitally ‘competent’ or ‘literate’ will not be enough; workers will have to learn more advanced skills that help them become creators – rather than just consumers – of digital content. They will have to become digitally ‘empowered’, and it is up to government, business and other stakeholders to create the conditions for this to happen.

Governments must ensure that the physical infrastructure is in place to enable digital economies to prosper – superfast broadband, for example. They must also ensure that digital learning is a core part of school curricula; that teachers have the skills and equipment to teach children what they need to know; and that they support individuals and companies by providing access to training and practical support.

Business has an important role to play too. In the UK, employers recognise that there is a skills deficit; many, for example, are convinced that productivity would increase if their employees’ digital skill levels were higher. Companies can address this, and improve career prospects, by investing in training and support.

The Barclays Digital Development Index is an effort to shift public debate in the UK and elsewhere from a discussion of basic digital competence towards one of digital empowerment, and to understand how ready the UK workforce is for the digital economy, compared with its rivals.

The index compares the workforce digital skills and attitudes of nations, along with the policies that are in place to improve them. It is based on a self-assessment survey that asked adult workers in 10 countries to evaluate their current digital skills, what they’ll need in the future, and how their employers and governments are helping them to address the gaps.

The objective of the index is to understand how well countries are equipping their workers for the digital economy. It looks at a broad spectrum of countries, including those currently competing with the UK and those likely to be competitors in the years ahead. These countries include perceived digital pioneers such as Estonia and Sweden, major industrial and high-tech giants such as Germany, South Korea and the US, and rapidly digitalising markets such as Brazil, China, India and South Africa.

The index assesses the 10 countries in two pillars of empowerment:

• The Individual Empowerment Index measures workers’ self-assessment of their digital skills in six categories ranging from basic to advanced. It also includes questions about how well their businesses and employers are helping to develop their skills.

• The Digital Empowerment Policy Index assesses national efforts to create a digitally empowered workforce – from getting the infrastructure right to embedding digital skills education in schools and the workplace.

The study’s major findings are as follows:

The international picture

• Estonia and South Korea are joint leaders in digital empowerment. Like most (though not all) developed countries in the index, their positions are based on active and well-organised government and business efforts to improve the teaching of digital skills. Even in these technology leaders, however, workforce confidence in digital skills is lower than among developing-country rivals.

• Workers in emerging markets are more confident about digital skills than those in developed markets. Worker self-assurance in emerging countries is especially high when it comes to basic skills such as web search and evaluation, communication and collaboration, and protecting data and devices. But it also comes through in the more advanced areas of coding, problem-solving and overall attitudes towards learning technology.

• When it comes to digital empowerment policy, developed countries boast stronger frameworks. These countries dominate the upper half of the table in all policy categories. One inference is that where individual confidence in digital skills is lower, stronger policy frameworks are needed to develop skills and build greater confidence.

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About the Digital Development Index

Barclays has undertaken a major new initiative this year to uncover the digital skills of the UK workforce in relation to nine international competitors with the launch of the first ever Digital Development Index. Led  by Ashok Vaswani, CEO of Barclays UK, the bank is seeking to better understand and highlight the critical need for a more digitally empowered UK, in order to develop and inform responses from government and the private sector that will support the UK in becoming a global leader in the digital revolution. Barclays would like to thank the many contributors from the business, scale-up and charity sectors who have offered their insights and expertise to the debate and who have enriched the report’s exploration of what is needed to foster the continued development of digital skills and confidence.