Closing the digital skills gap

Sometime last year, Labour and Employment Minister Sen. Chris Ngige brought the reality of Nigeria’s frightening unemployment scourge nearer home. While declaring open a two-day workshop on “Breaking the Resilience of High Unemployment Rate in the Country” in Abuja, he described Nigeria’s unemployment rate of 23.1 per cent and under-employment of 16.6 per cent as “alarming.”

The minister, who based his figures on the 2019 report of the National Bureau of Statistics (NBS), however, added a scary dimension to the menace when he projected that the unemployment rate will reach 33.5 per cent by 2020, with consequences that are better imagined, if the trend is not urgently reversed.

Sadly, the dire consequences of the ballooning unemployment rate, which Ngige warned about, are no longer in the realm of imagination.

They are staring Nigerians in the face. The upsurge in violent crimes and the widespread insecurity across the country, many people believe, are largely traceable to the rising unemployment rate.

Today, kidnapping, advance fee fraud, otherwise called 419, armed robbery, prostitution, cultism, drug and child trafficking, among others, have become daily occurrences.

There has also been an upsurge in violent campaigns by terrorist groups, particularly Boko Haram insurgents and the blood thirsty herdsmen.

Many youths, for lack of paid employments, have become ready recruits into terrorist organisations, a development that confirms fears that the country is, indeed, sitting on a keg of gunpowder.

However, while the authorities are still struggling to contain these ills, albeit unsuccessfully, a new threat has emerged in the already crisis-ridden labour market.

Severe shortage of digital skills, according to experts, has become a major impediment for organisations that are willing to implement Nigeria’s digital transformation.

The country has never hidden its intension to leverage emerging digital technologies to transform the economy. For instance, the Economic Recovery and Growth Plan (ERGP), 2017–2020, recognised the need for a digital-led strategy to make the economy more competitive in the 21st century.

The Nigeria Communications Commission (NCC) took this ambition a notch higher when, in 2015, it proposed the transition of the economy into a digital economy through investments in digital infrastructure, and more specifically broadband, which is a key driver of digital economy growth.

Also, the Minister of Communications and Digital Economy, Dr. Isa Pantami, re-echoed this resolve at the Seventh Study Group 13 (SG13) Regional Workshop for Africa, held in Abuja, a fortnight ago. He said: “The new focus is on how to use new and emerging digital technologies to transform the socio-economic life and activities of the country…”

The two-day workshop was organised by the International Telecommunications Union (ITU), with the theme, Standardisation of Future Networks towards Building a Better Connected Africa. Pantami said it was important that Africa positioned itself properly to key into the process of developing appropriate standards for next generation digital networks that support a digital economy.

Nearer home, where Nigeria is said to be capturing only a fraction of its digital economic potential, Pantami emphasised that “To achieve a digital economy, digital skills are central, and this has been adequately captured in the second pillar of the ‘’Digital Economy Strategy Policy Document” as approved and launched by President Muhammadu Buhari on November 28, 2019″.

That was at last week’s signing of a Memorandum of Understanding (MoU) between the Federal Government and the International Business Machines (IBM) West Africa, for partnership and collaboration in digital skills development in Nigeria.

The minister rode on the platform of the MoU signing and urged institutions of learning to give priority to skills, especially digital skills over paper qualifications.

Hear him: “Digital skills are more relevant in today’s world of emerging technologies. Therefore, we must encourage innovation and drive digital literacy and skills among the populace”.

The Country General Manager, IBM, Mr. Dipo Faulkner, further drove the message home when he said: “Digital economy and emerging technologies have brought changes in skill requirements as well as unemployment, and in jobs globally today.

“There is need to bridge the gap between education and entrepreneurship to ensure that people don’t acquire education alone, but that they have skills for self-sustainability and development of their environment.”

Noting that the new collaboration between Nigeria and IBM furthers IBM’s aim of scaling digital job skills across Africa, Faulkner said the collaboration “will be IBM’s contribution to Nigeria to help bridge the skills gap. We cannot afford to be left behind in the digital economy.”

The Nigeria-IBM collaboration and other similar efforts by the Federal Government and the private sector at honing the digital skills of Nigerians became necessary in view of the acute shortage of digital skills, which, according to experts, is already slowing the country’s transition to a digital economy.

The pool of Nigerians with digital skills validated by globally-recognised certification is said to be depleting, requiring urgent upskilling solutions to close the digital skills gap.

This, The Nation learnt, arose from the fact that the rate at which technology is evolving is faster than the rate at which skills are being developed.

What this means is that without replenishing the digital talent pool by encouraging innovation and driving digital literacy and skills among the populace, Nigeria may, indeed, be left behind in the digital economy.

Analysts at PricewaterhouseCoopers (PwC), who brought this challenge to the fore, said in their new study of private businesses on the continent that 36 per cent of business leaders in Nigeria and other African countries admitted that they lacked the required people to achieve the full benefits of digital transformation.

In the report titled “Time to Act: The key to Private Business Growth in Africa is Digitalisation,” the analysts at the multinational professional services firm said that as a result of the skills gaps, the majority of firms in Nigeria and other West African countries said inadequate skills gap had led to significant revenue losses.

PwC said it arrived at its report from insights it gathered from 200 private businesses from nine sub-Saharan African countries and over 2,000 private business leaders in Europe, the Middle East and Africa.

The PwC report, which was accessed by The Nation, said: “Losses were especially high in West Africa….When it comes to digital efforts, 36 per cent of leaders surveyed felt they lacked the right in-house talent to realise the full benefits. More than half seek to make up for the deficit by turning to external advice.”

Although, a new World Bank assessment said Nigeria is capturing only a fraction of its digital economic potential and will need to make strategic investments to develop a dynamic, transformative digital economy, shortage of digital skills is, however, not peculiar to Nigeria; it a global issue.

Globally, the digital skills gap is growing at an exponential rate. According to the Coursera 2019 Global Skills Index, two thirds of the global population is falling behind in critical skills, with 90 per cent being in developing economies, including Nigeria.

The International Data Corporation (IDC) “2019 Futurescape Report,” echoed this, saying that two million jobs in Artificial Intelligence (AI), the Internet of Things, cybersecurity and blockchain will remain unfilled by 2023 due to lack of human talent.

IDC is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets.

Over the past five years, IDC has been documenting the rise of the digital economy and the digital transformation that organisations must undergo to compete and survive in this burgeoning economy.

The corporation said that as the current decade comes to an end, the digital economy is approaching a critical tipping point.

It predicted that by 2023, the global economy will finally reach “digital supremacy” with more than half of all Gross Domestic Product (GDP) worldwide driven by products and services from digitally transformed enterprises.

“The impact on enterprises will be enormous: those not able to compete in the digitally-powered portion of the economy will be increasingly unable to compete in their core markets – the portion that is digitally dependent.

“As more than half the global economy turns digital by 2023, a new species of enterprise will be required to compete and thrive.

“Our 2020 predictions show that enterprises will prepare for the digitised economy by accelerating investments in key technologies and new operating models to become hyperspeed, hyperscaled, and hyperconnected organisations,” Senior Vice President and Chief Analyst at IDC, Frank Gens, said.

Now, with 2023 only three years away, how prepared is Nigeria in joining the global push to close the digital gap? What are the options open to Africa’s largest and most populous economy to replenish her talent pool and close the digital skills gap? Is Nigeria prioritising digital skill training?

Interestingly, the need to act by closing the digital gap is obvious not lost on Nigeria, which was why she signed the MoU with IBM West Africa for partnership and collaboration in the area of digital skills development.

The MoU provided the platform to empower Nigerian youths with digital literacy and skills, to enable innovation, design and development of indigenous solutions, self-sufficiency and make Nigeria a hub for critical skills in Africa and the world at large.

Under the partnership, and in line with the Digital Literacy initiative and drive of the Ministry, Dr. Pantami said IBM will, through its Digital Nation Africa Initiative, provide free training to Nigerians for a period of 12 to 16 weeks, in diverse areas of Information Technology (IT).

He explained that the objectives of the MoU were mainly to “create awareness and support in the development and use of digital tools and applications to improve the delivery of government services; create a pool of Nigerians with digital skills validated by globally recognised certifications; bridge the gap between the academia and the industry through sensitisation on digital tools and skills; and lower the access barrier to digital tools for the citizens.”

While this is seen by not a few analysts and commentators as a move in the right direction, they, however, noted that government must adopt a more pro-active and holistic approach to closing the nation’s widening digital skills gap, if the country must partake in reaping the bountiful benefits of a digital economy.

This is so considering a recent World Bank report, which stated that with improvements in digital connectivity, digital skills, digital financial services and other core areas of digital development, Nigeria can fully unleash new economic opportunities, create jobs and transform people’s lives.

“As the biggest economy in Africa with one of the largest populations of young people in the world, Nigeria is well-positioned to develop a strong digital economy, which would have a transformational impact on the country,” World Bank Senior Digital Development Specialist and co-author of the report, Isabel Neto, said.

The report added that “Through innovations and investments, the Nigerian economy can harness digital data and new technologies, generate new content, link individuals with markets and government services, and roll out new, sustainable business models.”

The report provided an assessment of the state of Nigeria’s digital economy around the five pillars of the Digital Economy for Africa initiative (DE4A) namely, digital infrastructure, digital platforms, digital financial services, digital entrepreneurship and digital skills—key foundational elements of a digital economy.

The DE4A is part of the World Bank Group’s support for the African Union’s Digital Transformation for Africa, which aims for every African person, business and government to be digitally abled by 2030.

According to the World Bank report, there is the need for Nigeria to improve her digital infrastructure, as it has minimal fixed broadband infrastructure and connectivity in rural areas, which leaves a significant number of the most marginalised segments of the population without Internet access.

It also recommended strengthening the digital platforms, pointing out that despite the fact that strong public and private digital platforms support the provision of digital services and a thriving eCommerce platform, millions of Nigerians lack formal identification records to access a range of public and private services.

The global lender also said there was need for increase access to digital financial services. According to the Bank, about 60 million Nigerian adults are without access to a formal account, stalling the country’s journey toward financial inclusion.

It added that whereas in other African markets financial inclusion would mostly be driven by digital financial service (DFS) providers, in Nigeria the huge potential of DFS remained untapped.

It also made a case for improved policy environment for digital entrepreneurship, noting that despite its large, youthful, and entrepreneurial population, digital entrepreneurship is yet to be fully exploited given its potential to become an engine of economic transformation in Nigeria.

Furthermore, the World Bank report recommended closing Nigeria’s digital skills knowledge gap. It pointed out that the capabilities and skills required to use various forms of digital technologies remain limited to a small segment of the population.

“Increases in higher level education and the existence of accessible online training initiatives is bringing digital skills to those able to access them.

“However, low enrollment in basic education and the poor quality of that education coupled with a lack of digital skills in curricula is segmenting digital skills into a slim share of the population, excluding the poorest from the benefits of the digital world, the report stated.

From a human resource perspective to closing the digital skills gap, the Chief HR Officer at SYSPRO Corporate, Mr. Terence Moolman, said considering the skills shortage, many Chief Human Resources Officers (CHROs) are realizing that a one-size-fits-all approach to talent management won’t work in today’s volatile, uncertain, complicated and ambiguous world.

He said instead, many global organisations are looking towards a creative and insights-driven approach to plugging the gap. He said instead of favouring a localized approach, many CHROs are accessing the global talent pool.

Moolman listed three key factors to consider when selecting from the global talent pool to include concentration of talent, labour costs and efficiency, and business environment.

“In a world where connectivity allows for a flexible and global workforce, leveraging pockets of excellence across the globe can be a step towards closing the digital skills gap. Businesses, therefore, need to identify where concentrations of talent lie,” he said.

On labor costs and efficiency, the HR expert said there is need to match the right talent with competitive compensation. “Labor costs and competitive compensation also need to be taken into consideration when identifying talent across the globe,” he advised.

Moolman said the ever-changing business environment should also be considered when building a global labor force.

In response to changing business needs, the 2019 Global Skills Index showed that the global appetite for developing technological skills is slowly increasing at the expense of traditional business skills.

According to the report, the demand for business skills such as sales or communications have been diminishing, while the demand for skills in technology and data science have grown exponentially.

In fact, technology enrollments increased 13 per cent since last year, while business enrollments fell by 11 per cent.

“While the industry plays catch up, it is vital for businesses to proactively continue with training initiatives in foundational business skills with current employees,” Moolman advised.

PwC, however, pointed out that the speed of technological change requires an urgent global upskilling effort, which Nigeria must be part of.

“The sheer speed, scope and impact of technological change are challenging businesses — and society at large — in fundamental ways,” Chairman of the PwC Network, Bob Moritz, said.

The consulting firm, however, clarified that “upskilling is not simply a matter of teaching people how to use a new device. That device may be obsolete by next year. The upskilling experience involves learning how to think, act and thrive in a digital world that is sustainable over time.”

PwC also said each nation will need to consider the demographics of its citizens, its level of tech maturity and the makeup of its economy to develop its own upskilling solution.

According to it, a territory with a developed economy, an ageing population and a strong service sector will have different priorities than a region with a developing, mostly rural economy and a population in which most people are under 30.

Yet for all their differences, PwC said all the places in the world have one thing in common — a growing number of working populations who need to raise their capabilities and understanding.