Closing the Digital Skills Divide: The Payoff for Workers, Business, and the Economy

Even before the coronavirus pandemic began, policymakers, businesses, and workforce advocates were already recognizing that workers were not being replaced by robots, but rather, being called upon to work hand-in-glove with rapidly evolving technology. Now — as leaders design labor market policies to drive a thriving and inclusive economy — it is imperative to understand this digital transformation. The analysis finds the following:

• There is an overwhelming demand for digital skills in the labor market, with 92 percent of all job ads requiring definitely digital or likely digital skills;
• Yet many workers have not had sufficient opportunity to build such skills; earlier research found that nearly one-third of US workers do not have foundational digital skills, and workers of color fall disproportionately into this category due to structural inequities;
• Equipping workers with the necessary skills requires action by both private employers and public policymakers. Notably, public investments in workforce development and education are especially vital given the unevenness of private investments and the prevalence of digital skill demands among smaller businesses, which depend on publicly funded workforce and education partners to upskill employees;
• Closing the digital skill divide has major payoffs for businesses. Prior research has shown that workers value upskilling opportunities and prefer working for employers who offer clear, well-defined pathways to advancement;
• Public investments in closing the digital skill divide can also generate economic benefits for individual workers and the broader economy. People who qualify for jobs that require even one digital skill can earn an average of 23% more than those working in jobs requiring no digital skills — an increase of $8,000 per year for an individual worker.

The analysis recommends the following:

• A digital skill foundation for all: Policymakers can support this goal by investing in free or low-cost digital skills training for workers, and ensuring that workforce development and education providers are equipped to provide high-quality upskilling programs; Workforce and education advocates and providers can support this goal by speaking up for digital equity investments that support workers’ goals and aspirations and respond to local businesses’ skill needs; Corporate decisionmakers and influencers can use their platforms to ensure that skills are central to digital divide discussions in the public and policymaking spheres.
• Ongoing upskilling for every worker in every workplace: Policymakers can support this goal by investing in industry sector partnerships that can collaborate with community colleges and other training providers to ensure that the talent development process is connected to industry-specific skill needs and jobs; Workforce and education advocates and providers can encourage policymakers to embed digital problem-solving skills as allowable or required activities under existing workforce development, adult education, and higher education policies, as well as digital equity policies; Corporate decisionmakers and influencers can implement policies and practices that support digital upskilling for workers at every level of their organizations. Smaller businesses can participate in regional industry partnerships that support these efforts across small businesses at scale.
• Rapid reskilling for rapid re-employment: Policymakers can support this goal by supporting access to skills for workers who have lost their jobs, including those transitioning to a new industry; Workforce and education advocates and providers can support this goal by sharing their expertise with policymakers on topics such as best practices in closing racial equity gaps in digital skill-building opportunities; Influencers and corporate decisionmakers can educate state and federal policymakers about the skills mismatches they are experiencing and the kinds of technical skills their companies need to be successful.