How the 'Digital Skills Gap' Bleeds $1.3 Trillion a Year From US Businesses

Many American workers, young and old, admit they often are not proficient with technology. Employers seem slower to grasp the problem.

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By Jeff Fernandez

Opinions expressed by Entrepreneur contributors are their own.

There can be little doubt that we live in a renaissance age of technology, particularly technology that makes work more efficient and connected. But we're also starting to see signs that we have rushed so much technology into the workplace that workers can't keep up.

Related: Not So Tech-Savvy?

This "digital skills gap" –employees not knowing the right technology tool to use for the job or how to properly use technology tools at their disposal – is costing the U.S. economy roughly $1 trillion a year in lost productivity. And this digital skills gap loss could easily grow as the pace of change in workplace technology continues rapidly.

Few have explored this gap in detail but to solve for it, we need to understand it. To quantify what and how it's costing U.S. businesses, we commissioned a Harris poll to survey workers across the country about the technology they use at work and how proficient they are with these tools. While we see the effects of this digital skills gap on our clients' businesses every day, the results of the survey should shock every company into action.

Particularly, almost one in three U.S. workers say they simply are not proficient in using the technology tools they need at work. What's more, only one in 10 American workers say they have mastered these tools.

More than one in five workers (21 percent) in our Dropbox age say they still prefer sharing large files on a flash drive or CD. Only 13 percent say they prefer cloud-based storage like Dropbox. What's more, nearly one in three workers who use these tools don't feel they are proficient in their skill (29 percent).

Fear of new technology isn't limited to file sharing. Across every category of technology we explored, we found most workers consider themselves unable to master the tools:

Among workers we spoke to who use customer relationship management tools like Salesforce, two in five (40 percent) say they are not proficient with this technology. At most, they say they can do a little but are not comfortable, and they would like instruction to accomplish even basic tasks.

Related: Report: U.S. Adults Lag Behind International Peers in Literacy, Math and Tech Skills

The numbers are only slightly better for proficiency with even simple tools like Hootsuite, a social media management tool. Over a third of workers who use these services at work say they still are not proficient at using them properly (35 percent). Only 11 percent of the workers using these tools at work consider themselves an expert.

The recession drove an explosion in the use of online meeting tools as companies cut back on travel expenses but, even in this area, workers still consider themselves ill-equipped to use the technology. Only 13 percent of workers who use these online meeting tools consider themselves experts, while 31 percent describe themselves as not proficient.

Some may suspect it is primarily older workers who struggle to master new technology but we found even younger workers can't keep up with the pace of technology change. In fact, only 14 percent of those between 18 and 34 years old consider themselves experts when averaged across the technology tools in all categories. Workers between 55 and 64 years old were only slightly less expert at using these tools overall, at 9 percent.

The digital skills gap is so costly because it is a wide chasm.

Three times as many workers consider themselves not proficient compared to those who consider themselves experts. According to IDC, about 20 percent productivity loss occurs across the workforce due to factors including digital inefficiency. Our workforce is made up of nearly 160 million people, with about 84 percent – or 125 million people – working in information sectors with technology of some sort. This means that if the average annual wage of an American worker is around $50,000 and 20 of productivity is lost, businesses lose $10,000 in productivity for each worker. In total, it's a $1.3 trillion hit to U.S. businesses.

On the plus side, workers of all ages who improve their technology proficiency will be increasingly valued. Our advice to the individual is take the initiative to learn technical skills. Don't wait for help from technical support at the office.

For businesses, the obvious answer is to invest about as much teaching workers how to use technology as they spend in acquiring this new technology. Recognize the need to invest time in transitioning to new services. Operations and HR teams should work with each department to make sure team leads understand the new product functionality and feel comfortable transitioning from old tools to new.

When onboarding a new tool, create easy-to-follow "cheat sheets" for daily functionality as it's applicable to your specific business. Distribute it to employees along with the log-in details, so they have the resources off the bat. Guiding them through the basics of the service will allow for quick adoption upfront.

Take advantage of services provided by paid-subscriptions. Many cloud services assign account representatives to help with the onboarding of new tools. Take advantage of these resources. Have the representative conduct introductions to the product by webinar or in-person, or host office hours at your workplace while teams get up to speed.

Support the initial onboarding with regular trainings. Technologies update quickly, and ongoing trainings that cover new features or go more in-depth on specific aspects of the tools will ensure employees remain current and get ahead of the curve. Instead of traditional "lecture hall" style trainings, use on-demand content and an on-the-go platform that HR teams can customize and that employees can access when most convenient for them. It will feel less like just another meeting.

Related: No Tech Background? No Problem

Jeff Fernandez

Cofounder & CEO

Jeff Fernandez is the co-founder & CEO of Grovo, a cloud-based training platform that teaches professional skills through a proprietary micro-learning methodology. At Grovo, Jeff leads the team to focus on their mission to solve the digital skills gap – brought about by the rapid influx of technology and cloud tools – in today’s workforce. Organizations in 190 countries, including more than 100 Fortune 500 companies, use Grovo to train their teams, using Grovo’s more than 4,500 video lessons and assessments covering 130 Internet tools, cloud services, and professional topics.

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