The introduction of technologies in companies aims, among other things, to improve productivity. This logic naturally also applies to digital technologies. There are various views on this, but the strong introduction of digital technologies in the second half of the 1990s led to productivity growth in developed economies until the mid-2000s.

As some of the literature suggests, aggregate productivity growth of firms should be reflected in productivity growth of economies in general. However, productivity statistics for several recent historical periods (see fact sheet 13) suggest that the introduction of digital technologies has not generated the expected increases at the aggregate level, i.e. the full exploitation of their possibilities has not been achieved, resulting in productivity increases below expectations.

This phenomenon has generated much interest and led to research to elucidate the mechanisms that cause, in a context of low costs and sustained investment in digital technologies, that productivity does not increase.

Some studies (Brynjolfsson 2014; Burdin 2021) have empirically observed that, in order to achieve significant productivity improvements, it is necessary to simultaneously invest in complementary factors relevant to the digital transformation process. Complementary factors are those that, when investing in one, have a relative impact on the value of the other. For example, investment in digital skills enhances the value of investment in technology.

These factors include, of course, (i) investment in technology; since it is essential to have a digital infrastructure in place to make digital technologies available. However, it is equally important to identify other variables necessary to enhance the process, such as: (ii) innovation in processes and management practices and (iii) skills training for workers at all levels, since it will be necessary to operate the new technologies within the framework of the organisational innovations introduced.

It is clear that, simultaneously with the adoption of a new technology, there must be a set of change-oriented practices that accompany the digitisation process and facilitate both its adoption and the optimisation of its use. The ability of senior management to visualise and implement innovations in the way they work will be key.

This complementarity is also observed in the unequal distribution of the exploitation of digitalisation among organisations: those companies with a more qualified workforce and better organisational competences take better advantage of the productive potential of digitalisation, benefiting from the returns captured in the process (OECD 2019).

From the perspective of vocational education and training, two challenges open up, (i) assisting in the digital transformation of enterprises and (ii) digitally transforming themselves.

In relation to the former, Vocational Education and Training (VET) institutions will have the capacity to develop digital skills and competences for the digital economy in current and future workers, thus influencing one of the three complementary factors. Their involvement in this process of business transformation is then limited to this factor, as the other two factors, infrastructure provision and management training, are generally not within their mandate.

As far as the second challenge is concerned, all PFIs have the necessary tools at hand. Their digital transformation depends on investment in technology aligned with the training of their management and teaching staff. Transformation is an achievable and necessary goal that requires political determination to initiate.

Source: OECD 2019

This point is of particular relevance for vocational education and training systems in two scenarios:

(i) In the response to the labour market: it will be necessary to develop digital skills but also those skills that enable workers to successfully navigate more innovative organisational processes. This is where transversal competences appear.

(ii) VET systems that want to move towards their own digital transformation will need to invest in technology, but fundamentally rethink their processes and equip their administrative and teaching staff with the necessary skills.

In this note and its resources, you will find the rationale that the potential of digitisation to improve productivity does not depend solely on investment in technology, but on a simultaneous focus on three closely linked complementary factors: technology, processes and skills.

Sources for this note:

• Burdín. 2021. «Digitalización, productividad y empleo: elementos para pensar la formación profesional en América Latina»
• OECD (2019), OECD Economic Outlook, Volume 2019 Issue 1, OECD Publishing, Paris, https://doi.org/10.1787/b2e897b0-en.