Lack of skills means faster internet could result in job losses

Chinese infrastructure vendor Huawei claims that if the anticipated benefits of fibre-based broadband are to be realised in the UK, issues such as the shortage of digital skills across many industries and old-fashioned working practices and business processes need to be addressed. If they are not, the emergence of superfast broadband connections could result in UK companies outsourcing more jobs abroad rather than creating them locally.

The vendor commissioned a report entitled “Superfast Britain? Myths and realities about the UK’s broadband future”, published by the Economist Intelligence Unit. It found that the rollout of superfast networks and increases in the speed of broadband is likely to provide a short-term stimulus, providing jobs and boosting economic activity. However, many of the jobs that improved broadband services will create are likely to be limited to the short-term.

“If you input a certain amount in fibre optics, you’re going to create a number of jobs in construction and digging trenches, in electronic equipment, in steel and plastics, professional services and civil engineering,” explained Raul Katz, director at US research institute the Columbia Institute for Tele-Information in the report.

However, the report termed this rise in jobs as the “construction effect” and warned that such jobs are short term in nature. Barriers to long-term progress are a shortage of suitable digital skills, institutional resistance to change, unreformed processes and a lack of pervasive basic broadband access, the report warned.

“Now that a connection is very fast, a games developer might say that it will develop its video games in Asia. Jobs will be created in Asia, but leaked from Britain,” said Katz.

David Dean, senior partner and managing director at management consultancy firm Boston Consultancy Group, added that the emphasis on the skills needed by the UK’s workforce needs to shift to make the most of digital services.

“What’s holding firms back on the internet is access to talent – people who understand digital marketing, how to do e-commerce, who understand big data and analytics, and all the things that can be done on the web.”

And Steve Unger, group director – strategy, chief economist and technology at UK telecoms regulator Ofcom, said that the country also needs people who can develop new applications.

“If we want to build the next Google, what we need are people with a profound understanding of the mathematics that underpin , so we need a technologically capable workforce.”

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One comment

  1. Avatar Robert Cohen 06/11/2012 @ 4:35 pm

    To assume as this article suggests that the UK will only benefit short-term from the “construction” effects is inaccurate. As one who has modeled the impacts of the Internet and greatly increased broadband on Europe for the Commission, it is important to examine the new jobs in key sectors that would take advantage of higher speeds. This takes a bit more creativity, but to fail to assess the jobs — by computer skills, software skills — is a significant shortcoming of this estimate. It would make sense to redo this analysis using a more sophisticated labor market analysis. Europe and the UK have many academic centers that have trained people who can fill these jobs. London, Manchester, Cambridge and many other universities have trained people who are very skilled in computing, software, mobile communications and can readily take advantage of these new speeds.

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