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Digitisation, Big Data and AI in Italy. Digital ethics and use of data

The Italian AI market has grown by +92% in the last 3 years: entrepreneurs are interested in new technologies (50%) but workers fear the consequences (73%)
22/05/2023 Divulgatory Research Download PDF
  • The impact of AI in Italy could affect around 2 million jobs by 2030, the highest number in Europe.
  • Today, the Italian AI market is worth €500 million, a figure that amounted to only €260 million in 2019, a growth that will continue to climb towards €700 million by 2025.
  • Italy is 4th in Europe for the development of start-ups in generative intelligence. Despite this, it ranks 25th for digital skills, outperforming only Bulgaria and Romania, and only 1.4% of Italian graduates choose ICT disciplines, the lowest figure in the EU.
  • Sixty per cent of Italian SMEs have a basic level of digital intensity, the EU average is 55%: the regions with the highest AI innovation are Lombardy and Lazio, followed by Campania and Emilia-Romagna.
  • According to the survey carried out by Rome Business School, 68% of respondents believe that ChatGPT will have a positive impact on the world of work, but only 42% think they will use it at work by 2025.
  • Investment in training is needed: with more than 300 million jobs disappearing by 2030 due to the incorporation of AI, there is a need to acquire key skills for roles such as prompt engineer.

The use of artificial intelligence in Italy, a market that grew by +32% in 2022 alone, worth over €500 million, brings with it innovation, transformation and change, but also dangers and fears. 73% of Italians are worried about their jobs and, in one respect, they are right: according to Distrelec, the impact of AI in Italy could affect around 2 million jobs by 2030, the highest number in Europe, after Germany and France.

This is what emerges from the latest research by Rome Business School, “Digitisation, Big Data and AI in Italy. Digital ethics and use of data” by Aldo Pigoli, expert in geopolitics and competitive intelligence, Valentino Megale, lecturer at the International MBA, William Carbone, Program Director of the International Online Master in Artificial Intelligence and Valerio Mancini, Director of the Rome Business School Research Centre.

“Italy is taking giant steps to be a protagonist of the digital era: from huge investments in new projects, to research and adoption of digital solutions in both large companies and SMEs. But specialised training, further investment, and greater collaboration between industry, academia, and government are needed, not only to develop new technologies, but also to protect people’s privacy and respect their dignity,’ say the authors.

Italy and Europe: a comparison on digital transformation

As of January 2023, around 130 start-ups in the specific field of generative intelligence are operating in Europe: the United Kingdom leads with an estimated 55 start-ups, Italy ranks eighth (Sifted, 2023). Italy saw the sector grow by +92% between 2019 and 2022, from EUR 260 million to the current EUR 500 million, and is estimated to reach EUR 700 million by 2025. Despite this, Italy still lags far behind in many European-level indicators: we are in 17th place out of 27 Member States in terms of digital transformation, and even 23rd for the general level of digitisation (European Commission, 2022). The situation is also worrying for human capital: Italy ranks 25th in terms of digital skills, with only 46% of the population possessing basic skills, outperforming only Bulgaria and Romania. This is below the European average of 54%. In addition, only 1.4% of Italian graduates choose ICT disciplines, the lowest figure in the EU.

Italy must close the gap it has so far accumulated with the other major international players. The funds earmarked in the PNRR will be key to this: 48.1 billion are dedicated to digitalisation, placing Italy as the leading country in Europe in terms of investment in this sector, ahead of Spain, France and Greece.

Innovation in Italian companies: from SMEs to large corporation

In the integration of digital technologies, Italy ranks 8th in the EU, with most Italian SMEs having a basic level of digital intensity (60%), exceeding the EU average of 55%. However, the diffusion of more complex technologies such as big data and artificial intelligence is still limited: 40% of SMEs do not have ad hoc professional figures dealing with data analysis. The push towards the adoption of these technologies is strong. Lombardy and Latium have the largest number of SMEs using AI, with over 45% of Italy’s expenditure on information and communication technology in 2021; followed by Emilia-Romagna, Veneto and Piedmont (29%). The authors also highlight how Apulia and Sicily are proving to be particularly dynamic (with almost 4% each), making a significant contribution to the growth of the sector and the development of southern Italy (the other regions barely exceed 1%).
Analysing the use of AI by sector, in 2021 more than 80% of Italian manufacturing companies were already using AI-based machines and systems to automate hazardous activities and improve product quality; in the agrifood sector, according to the Smart Agrifood Observatory, the use of smart tools in 2022 increased by 15%.

Italians and ChatGPT: more personal than business use, the importance of training

In April 2023, the research authors surveyed 136 professionals and students about their use of ChatGPT. 51% of respondents said that they have used ChatGPT and that, although they are aware of the risks (55%), they prefer to continue using it because they recognise the opportunities it offers (65%). Despite this, only 42% of respondents believe that their company or the company where they work will use ChatGPT by 2025.

“It is possible, however, that they see the use of other artificial intelligence programmes in the future, considering that ChatGPT is currently used more for tasks such as composing essays and marketing strategies,” says Valentino Megale.

In fact, an overwhelming 68% of participants believe ChatGPT will have a positive impact on the world of work, and despite their fears, 61% said they use or plan to use ChatGPT in their daily lives.

“These results show that there is a real interest from people to experiment with artificial intelligence tools, but it also reminds us how crucial it is to educate people on the implications of this use.

Not only will it be key to educate users, but also current and future workers. Indeed, AI will make obsolete many jobs for which new skills need to be acquired as of now: roles such as prompt engineer or prompt designer, which involve designing the requests to be made to AI programmes and understanding the algorithms on which they are based, will be crucial in the labour market. Currently, the skills most in demand by companies are related to the acquisition, management and analysis of data related to production and business processes.

“There is a strong need to create a system of continuous training that allows workers to acquire new skills quickly and effectively, so as to maintain their ’employability’ in the field of AI and adjacent sectors,” says William Carbone.

The challenges of AI: protecting privacy and respecting ethical values

One of the main concerns with the use of AI relates to algorithmic discrimination, which can lead to the denial of jobs, loans or other opportunities, as well as unfair treatment from a legal point of view to certain groups of people. Another issue relates to citizens’ ignorance or incomplete understanding of the risks of using AI, and consequently being manipulated into sharing private information without realising it. “Augmented reality, data sharing and the use of increasingly powerful algorithms will make AI capable of following, understanding and challenging us in the most diverse contexts,” says Valerio Mancini. ‘How to protect our privacy is one of the biggest tests governments face. They must seize this opportunity to strengthen their legitimacy, inclusion and citizen satisfaction’.

In Italy, there is still no comprehensive regulatory framework on AI ethics, but work is underway to develop guidelines, establish ethics research centres, and promote public awareness campaigns. In fact, Italy was the first among European countries to take concrete steps to safeguard users against ChatGPT.

“Italy has undoubtedly acted as a forerunner, setting a precedent that will serve to inform other similar initiatives (not only European) and that will represent a reference, above all, for a European debate aimed at creating common rules for member countries,” says Aldo Pigoli.

At European level, the Union is taking measures such as Convention 108+, which should enter into force in October and aims to regulate the processing of personal data and facilitate international data transfers. In addition, the Artificial Intelligence Act (AIA) is being considered to regulate the development and use of AI, with stricter requirements for high-risk systems. If adopted, it will be one of the strictest AI regulations in the world.

The advent of the data economy and the investment trends of Italians

Data and digital technologies will increasingly impact on the economic and social value of businesses, and are already indispensable for making competitive decisions, managing processes and engaging stakeholders. The ‘data-based economy’ is evolving towards a ‘data economy’, in which data become the central element of production, transactions and investments. According to a study carried out by EY Tech Horizon in 2022, 50 per cent of Italian entrepreneurs surveyed have already activated major digital transformations, compared to 39 per cent of the rest of the world. Their main investment trends are Data and Analytics (22%), Internet of Things (20%), Cloud (18%) and AI (15%).
Artificial intelligence offers tremendous opportunities to improve lives, tackle global problems and promote scientific progress. However, there are significant and unprecedented risks to consider.

“It is crucial that governments and institutions are committed to protecting citizens without hindering innovation, promoting the ethical and responsible use of AI and supporting the economic growth that comes with it. Existing systems need to be strengthened and focus on training and skills development to create a prepared and aware workforce,’ Aldo Pigoli concludes.