Will the #DigitalSingleMarket Kill More Jobs than it Creates?

As the European Commission sends its most convincing member – vice president Andrus Ansip – to impress on us everyday Europeans the importance of making the digital single market real, Netopia looks at some of the numbers in play. Today: jobs.

VP Ansip says he expects 3,8 million jobs to be added by the digital single market. Not bad, even by international standards. In fact, that would be outperforming the US with a 100% or more. According to Ansip’s colleague, the Commissioner for Internal Market Elżbieta BieńkowskaIf all Member States matched the digital performance of the US, 1.5 million additional jobs could be created in the EU.” So for 3,8 million jobs, Europe must not only match the US but more than double its performance. Of course, without access to Silicon Valley-style venture capital, bottomless military R&D-funds, an integrated market with one dominant language and all the other cool stuff the US has to offer (drive-in banks, anyone?), it’s a tall order – far beyond cross-border access to Baltic football.

Where does the figure 3,8 million jobs come from, anyway? I did some digging and found a 2013 report on the promise of cloud-computing that talks about 3,8 million jobs. Except 1,3 million of those would have come anyway, in the “no intervention-scenario”, so it’s really 2,5 million jobs. And that of course “does not take into account the jobs that would be lost or the workers displaced by cloud-related reorganization of business processes and productivity increases”. Right. So, there may be new jobs, just not very many, and the net effect is unclear. I see how 3,8 is a much better pitch for Ansip.

Now, let’s be fair. It’s not like the vice president is the only commissioner who talks about millions of jobs that could come. Ansip’s predecessor, Neelie Kroes, expected 4,8 million jobs to be generated by the “app industry” by 2018. Granted, that may have been optimistic (and will we really talk about “apps” in the future?), but the main difference is that apps have to be developed by people – it’s a form of content on the digital networks. That’s where the jobs are, in content. In other sectors, digitalisation for sure drives productivity increase but that is most often realised in efficiency gains rather than jobs created. If the Commission wants the digital single market (or multiple markets, whatever) to be job creators, it should look to content rather than infrastructure. Odd enough, the content creators don’t seem too excited about the idea of compulsory pan-European licensing. They even say it would kill jobs.