Employees with advanced digital skills contribute $508 bn to India’s annual GDP: Report

Nearly nine out of 10 companies in India are facing hiring issues owing to the increasing technology skills gap, according to a new study published on Wednesday. The study conducted by cloud services provider Amazon Web Services (AWS) launched jointly with advisory firm Gallup that polled more than 2,000 professionals in India across industries further said that those who use advanced digital skills (including cloud, AI/ML, software development) can contribute an estimated $507.9 billion (₹10.9 trillion) to India’s annual gross domestic product (GDP). 

 This contribution is attributed to the 92% higher salaries that these workers earn compared to those with a similar education who do not use digital skills at work, the report said, adding that advanced digital workers in India are benefitting from more than just a boost in their income. It said that 91% of workers who use advanced digital skills express higher job satisfaction, compared to 74% of workers with intermediate skills and 70% of workers with basic digital skills. Similarly, the study also found that employers that rely heavily on advanced digitally-skilled workers, digital technology, and cloud technology reap higher business growth and innovation. 

The study found that 21% of Indian organisations that run most of their business on the cloud report a doubling of annual revenue or more, compared to 9% of those that use the cloud for some or none of their business. Cloud-based organisations are also 15% points more likely to have introduced a new or improved product within the last two years (95% vs. 80%). 

With many organisations now preparing for the challenges of a digital future, the Gallup study looked at 10 emerging technologies including AI, edge and quantum computing, blockchain, and cryptocurrency. Ninety-two percent of employers in India say at least one of these technologies is likely to become a standard part of their future business operations, with 5G ranking the highest at 78%, said the study. 

“People in India are increasingly going digital, from the way they work to the way they live. This research shows that digital skills provide immense economic value to India at the individual, organisational, and macroeconomic level,” said Jonathan Rothwell, Gallup Principal Economist.  

“As more organisations move their IT to the cloud over the next decade and new technologies emerge, digitisation is going to fuel a vast number of new jobs. The opportunity for India to be competitive in the digital economy depends on having a robust and highly skilled workforce to support current and future innovations,” Rothwell added. 

The study also found that digital transformation of businesses and government agencies accelerating around the world, demand for advanced digital workers will remain strong in the coming years. It said that 93% of Indian employers surveyed reported they were seeking to fill openings that require digital skills, but 88% said it is challenging to find the talent they need. Nonetheless, nine out of 10 employers say that digital certifications or training courses are acceptable substitutes for a bachelor’s degree. 

A report by staffing firm TeamLease published earlier this month also said that India will need 30 million digitally skilled professionals by 2026. The report further said that at least 50% of the current workforce should re-skill themselves digital technologies, including, artificial intelligence (AI), big data analytics, internet of things (IoT) and cloud computing to bridge the digital skills gap. The report highlighted that over 2 million jobs in artificial intelligence (AI), cyber-security and blockchain are expected to remain unfilled in 2023. Additionally, the workplace is evolving so rapidly that 76% of the global workforce is not equipped with the requisite skills to function in the new digitally focused workplaces.  

Further, another report published by Nasscom-Zinnov, published in February last year, also said that India is projected to face a shortage of nearly 1.9 million tech professionals by 2026. This translates to over 21% tech talent gap (as a percentage of supply), which is the lowest globally amongst all the leading economies.  

The respective reports however noted that adequate training and comprehensive skill programs based on real-life practices will be the future of skilling.