Digitalisation in Europe 2022-2023 E-Book

European Investment Bank

• Herausgeber: European Investment Bank
• Kategorie: Fachliteratur
• Sprache: Englisch
• Veröffentlichungsjahr: 2023

Seitenzahl: 54

Beschreibung

The European Union is closing the digital gap with the United States. More than half of European firms invested in digitalisation during the COVID-19 pandemic, and they are rapidly catching up with their US peers in implementing advanced digital technologies. Despite the progress, however, Europe is not well positioned in digital innovation, and it is at risk of developing dependencies in several critical technologies. Some key takeaways: - Digitalisation has helped European firms adjust at a time of repeated economic shocks. Digital firms also tend to be more productive. - Successfully managing the digital transition and taking advantage of its long-term benefits goes beyond technology adoption – it requires societal change. - Firms' digitalisation depends on several factors, such as adequate digital infrastructure, competition-friendly regulation and labor market skills.The report, Digitalisation in Europe 2022-2023 : Evidence from the EIB Investment Survey, uses data collected from firms to shed light on the progress small and medium firms in Europe are making on digitalisation.

Leseprobe

Digitalisation in Europe 2022–2023

Evidence from the EIB Investment Survey

About the European Investment Bank

The European Investment Bank Group is the EU bank and the world’s biggest multilateral lender. We finance sustainable investment in small and medium-sized enterprises, innovation, infrastructure, and climate and environment. We have financed Europe’s economic growth for six decades and are at the forefront of EU crisis response, leading the world in climate investment and backing development of the first COVID-19 vaccine. We are committed to triggering €1 trillion in investment in climate and environmental sustainability to combat climate change by the end of this decade. About 10% of all our investment is outside the European Union, where our EIB Global branch supports Europe’s neighbours and global development.

Contents

Overview

Digitalisation in the European Union

The EIBIS Corporate Digitalisation Index

Digital divides between European firms

How digital infrastructure enables firms’ digitalisation

Investment in digital infrastructure by European municipalities

Intangible investment and innovation

Digital skills, employment and management

Product market regulation and market power

International trade and firms’ resilience

Investment in climate change

Conclusion and policy recommendations

References

Country pages

Appendix A: The EIBIS Corporate Digitalisation Index

Appendix B: Comparing the EIBIS to other data sources

Overview

The European Union is closing the digitalisation gap with the United States. More than half of European firms responded to the pandemic by investing in digitalisation, and they are rapidly catching up with their US peers in implementing advanced digital technologies. Despite this, Europe is not well positioned in digital innovation, and is at risk of developing dependencies in several critical technologies.

Digitalisation drives firms’ resilience to economic disruption and climate change, and it has helped European firms adjust at a time of repeated shocks. Digital companies displayed more resilience to the economic and trade disruptions unleashed by the COVID-19 crisis and the war in Ukraine, suggesting that they found more efficient ways of working. Digital firms generally perform better than non-digital firms, tending to be more productive. They are also more likely to engage in international trade and invest in addressing the physical and transition risks of climate change.

Successfully managing the digital transition and taking advantage of its long-term benefits goes beyond technology adoption. The digital transformation is a societal change. Striking the right technological balance is a complex process for the European Union, which is caught between global players that are defining the cutting edge of digital innovation, national preferences and societal and regulatory patterns that set boundaries on the use of digital technologies. To make the most of the digital transformation, the European Union will need to position itself well in the global environment, creating better internal conditions for innovation in technologies that are crucial to European interests, while staying within the boundaries of the European economic model.

Firms’ digitalisation depends on external and internal factors. These include adequate digital infrastructure and competition-friendly regulation, as well as management decisions on investment in employee training and trade with firms in innovative sectors, which accelerates the spread of digital technologies. A coordinated policy framework is crucial to addressing infrastructure gaps, improving digital skills, developing the innovation environment and regulating efficiently. Governments and municipalities also need to embrace digitalisation themselves. For many regions, this implies a coherent approach to digital governance, guided by the needs of people and firms.

Debora Revoltella

Director, Economics Department

European Investment Bank

Digitalisation in the European Union

More than half of firms invested in digitalisation in response to the COVID-19 crisis. In the European Union, 53% of firms report taking action to become more digital — for example by providing services online — according to the results of the EIB Investment Survey (EIBIS) conducted from April to July 2022 (EIB, 2023). However, significant differences exist between countries and firm sizes (Jaumotte et al., 2023).

Investment in digitalisation as a response to COVID-19 (% of firms), by country

Source: EIBIS 2022.

The share of firms that invested in digitalisation as a response to COVID-19 is higher in the United States than in the European Union, and this gap increased from 2021 to 2022. Micro and small firms are lagging behind medium-sized and large firms. In the European Union, only 30% of microenterprises stated that they took steps to improve digitalisation in 2022, compared with 62% of large firms. European micro and small firms are also less likely than their US peers to report having invested in becoming more digital.

In addition to moving ahead with basic digitalisation, European firms are accelerating the adoption of new, advanced digital technologies after putting these processes on hold in the first year of the pandemic. The European Union has been closing its digital adoption gap with the United States over the past four years. The share of EU firms implementing advanced digital technologies increased from 2021 to 2022, reaching 69% compared with 71% in the United States.

Investment in digitalisation as a response to COVID-19 (% of firms)

Source: EIBIS 2021-2022.

Note: The numbers on top of the bars indicate differences in percentage points between the United States and the European Union.

Question: As a response to the COVID-19 pandemic, have you taken any actions or made investments to become more digital (e.g., moving to online service provision)?

Adoption of advanced digital technologies (% of firms)

Source: EIBIS 2019-2022.

Note: The numbers on top of the bars indicate differences in percentage points between the United States and the European Union. A firm is identified as having adopted an “advanced digital technology” if at least one digital technology specific to its sector was implemented in parts of the business and/or if the entire business is organised around at least one digital technology. Firms were asked about four different digital technologies specific to their sector (see Box 1).

Question (2019-2021): Can you tell me for each of the following digital technologies if you have heard about them, not heard about them, implemented them in parts of your business, or whether your entire business is organised around them?

Question (2022): To what extent, if at all, are each of the following digital technologies used within your business? Not used in the business; used in parts of the business; entire business is organised around this technology.

However, implementing advanced digital technologies requires more significant investment than simple digitalisation activities such as providing services online.