The state of innovation and digital transformation in Spain

Fecha de la noticia: 02-09-2024

Computer screen with an icon representing innovation and digital transformation.

Digital transformation has become a fundamental pillar for the economic and social development of countries in the 21st century. In Spain, this process has become particularly relevant in recent years, driven by the need to adapt to an increasingly digitalised and competitive global environment. The COVID-19 pandemic acted as a catalyst, accelerating the adoption of digital technologies in all sectors of the economy and society.

However, digital transformation involves not only the incorporation of new technologies, but also a profound change in the way organisations operate and relate to their customers, employees and partners. In this context, Spain has made significant progress, positioning itself as one of the leading countries in Europe in several aspects of digitisation.

The following are some of the most prominent reports analysing this phenomenon and its implications.

State of the Digital Decade 2024 report

The State of the Digital Decade 2024 report examines the evolution of European policies aimed at achieving the agreed objectives and targets for successful digital transformation. It assesses the degree of compliance on the basis of various indicators, which fall into four groups: digital infrastructure, digital business transformation, digital skills and digital public services.

Assessment of progress towards the Digital Decade objectives set for 2030. European KPIs for 2024. Digital infrastructure. 1.1. Overall 5G coverage: 89% achieved; target: 100% coverage. 1.2. 5G coverage at 3.4-3.8GHz (not a KPI, but gives an important indication of high quality 5G coverage): achieved 89%; target: 100% coverage. 1.3. Fiber to the premises (FTTP: achieved 64%; target: 100% coverage. 1.4. Very high capacity fixed network: achieved 79%; target: 100% coverage. 1.5. Semiconductors: reached 55%; target: 20% of global production. 1.6. Edge nodes: reached 1186; target: 10,000. 1.7. Quantum computing: 1 by 2024; target: 3 quantum computers. 2. Digital transformation of businesses. 2.1 Digital intensity of SMEs: reached 64%; target: 90% SMEs. 2.2. Adoption of the cloud: reached 52%; target: 75% of companies. 2.3 Adoption of Big Data (The former Big Data indicator is now replaced by the adoption of data analytics technologies. Progress is not fully comparable) achieved 44%; target: 75% companies. 2.4. Adoption of AI: achieved 11%; target: 75% companies. 2.5. Unicorns. achieved 53%; target: 498 (2x the 2022 baseline). 3. Digital capabilities. 3.1. Basic digital skills: achieved 64%; target: 80% of individuals. 3.2. ICT specialists: reached 48%; target: 20 million employees. Digital public services. 4.1 Digital public services for citizens: achieved 79%; target: Rating/100. 4.2. Digital public services for businesses: achieved 85%; target: Rating/100. 4.3. Access to electronic health records: achieved 79%; target: Rating/100. 4.4. 4.4. Electronic identification (eID): 85% achieved; target: 27 million with eID reported. *Not a KPI, but gives an important indication of high quality 5G coverage. Source: State of the Digital Decade 2024 Report.

Figure 1. Taking stock of progress towards the Digital Decade goals set for 2030, “State of the Digital Decade 2024 Report”, European Commission.

In recent years, the European Union (EU) has significantly improved its performance by adopting regulatory measures - with 23 new legislative developments, including, among others, the Data Governance Regulation and the Data Regulation- to provide itself with a comprehensive governance framework: the Digital Decade Policy Agenda 2030.

The document includes an assessment of the strategic roadmaps of the various EU countries. In the case of Spain, two main strengths stand out:

  • Progress in the use of artificial intelligence by companies (9.2% compared to 8.0% in Europe), where Spain's annual growth rate (9.3%) is four times higher than the EU (2.6%).
  • The large number of citizens with basic digital skills (66.2%), compared to the European average (55.6%).

On the other hand, the main challenges to overcome are the adoption of cloud services ( 27.2% versus 38.9% in the EU) and the number of ICT specialists ( 4.4% versus 4.8% in Europe).

The following image shows the forecast evolution in Spain of the key indicators analysed for 2024, compared to the targets set by the EU for 2030.

Key performance indicators for Spain. Shows the target set for 2024 (Country coverage, % of EU target.) Data for 2023 and projections to 2030 can be seen in the source) . 1. Very high capacity fixed network: 97%. 2. Fiber-to-the-premises (FTTP): 96%. 3. Overall 5G coverage: 98.9%. 4. Edge nodes: no data. 5. Digital intensity of SMEs: 68.3%. 6. Cloud: 47.3%. 7. Data analytics: 45.9%. 8. Artificial intelligence: 14.1%. 9. Unicorns: 61.5%. 10. Basic digital capabilities: 83.6%. 11. ICT specialists: 50%. 12. Digital public services for citizens: 88.7%. 13. Digital public services for businesses: 95%. 14. Digital health: 87.3%. Source: State of the Digital Decade 2024 Report.

Figure 2. Key performance indicators for Spain, “Report on the State of the Digital Decade 2024”, European Commission.

Spain is expected to reach 100% on virtually all indicators by 2030.  26.7 billion (1.8 % of GDP), without taking into account private investments. This roadmap demonstrates the commitment to achieving the goals and targets of the Digital Decade.

In addition to investment, to achieve the objective, the report recommends focusing efforts in three areas: the adoption of advanced technologies (AI, data analytics, cloud) by SMEs; the digitisation and promotion of the use of public services; and the attraction and retention of ICT specialists through the design of incentive schemes.

European Innovation Scoreboard 2024

The European Innovation Scoreboard carries out an annual benchmarking of research and innovation developments in a number of countries, not only in Europe. The report classifies regions into four innovation groups, ranging from the most innovative to the least innovative: Innovation Leaders, Strong Innovators, Moderate Innovators and Emerging Innovators.

Spain is leading the group of moderate innovators, with a performance of 89.9% of the EU average. This represents an improvement compared to previous years and exceeds the average of other countries in the same category, which is 84.8%. Our country is above the EU average in three indicators: digitisation, human capital and financing and support. On the other hand, the areas in which it needs to improve the most are employment in innovation, business investment and innovation in SMEs. All this is shown in the following graph:

Blocks that make up the synthetic index of innovation in Spain. Score in relation to the EU-27 average in 2024 (=100). 1. Digitalization: 145.4%. Human capital: 124.6%. 3. Financing and support: 104.4%. 4. Environmental sustainability: 99.2%. 5. Collaboration with the system: 96.0%. 6. Attractive research systems: 90.5%. 7. impact of innovation on sales: 90.2%. 8. Use of ICT: 89.2%. 9. Products and exports: 82.7%. 10. Employment of innovation: 62.7%. Business investment: 62.6%. 12. innovation in SMEs: 53.9%. Source: European Innovation Scorecard 2024 (adapted from the COTEC Foundation).

Figure 3. Blocks that make up the synthetic index of innovation in Spain, European Innovation Scorecard 2024 (adapted from the COTEC Foundation).

Spain's Digital Society Report 2023

The Telefónica Foundation also periodically publishes a report  which analyses the main changes and trends that our country is experiencing as a result of the technological revolution.

The edition currently available is the 2023 edition. It highlights that "Spain continues to deepen its digital transformation process at a good pace and occupies a prominent position in this aspect among European countries", highlighting above all the area of connectivity. However, digital divides remain, mainly due to age.

Progress is also being made in the relationship between citizens and digital administrations: 79.7% of people aged 16-74 used websites or mobile applications of an administration in 2022. On the other hand, the Spanish business fabric is advancing in its digitalisation, incorporating digital tools, especially in the field of marketing. However, there is still room for improvement in aspects of big data analysis and the application of artificial intelligence, activities that are currently implemented, in general, only by large companies.

Artificial Intelligence and Data Talent Report

IndesIA, an association that promotes the use of artificial intelligence and Big Data in Spain, has carried out a quantitative and qualitative analysis of the data and artificial intelligence talent market in 2024 in our country.

According to the report, the data and artificial intelligence talent market represents almost 19% of the total number of ICT professionals in our country. In total, there are 145,000 professionals (+2.8% from 2023), of which only 32% are women. Even so, there is a gap between supply and demand, especially for natural language processing engineers. To address this situation, the report analyses six areas for improvement: workforce strategy and planning, talent identification, talent activation, engagement, training and development, and data-driven culture .

Other reports of interest

 The COTEC Foundation also regularly produces various reports on the subject. On its website we can find documents on the budget execution of R&D in the public sector, the social perception of innovation or the regional talent map.

For their part, the Orange Foundation in Spain and the consultancy firm Nae have produced a report to analyse digital evolution over the last 25 years, the same period that the Foundation has been operating in Spain. The report highlights that, between 2013 and 2018, the digital sector has contributed around €7.5 billion annually to the country's GDP.

In short, all of them highlight Spain's position among the European leaders in terms of digital transformation, but with the need to make progress in innovation. This requires not only boosting economic investment, but also promoting a cultural change that fosters creativity. A more open and collaborative mindset will allow companies, administrations and society in general to adapt quickly to technological changes and take advantage of the opportunities they bring to ensure a prosperous future for Spain.

Do you know of any other reports on the subject? Leave us a comment or write to us at dinamizacion@datos.gos.es.

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