The Three Lions were knocked out of the championship at the group stage following a 3-1 defeat against Italy.
Nine members of the squad are still young enough to feature in the next U21 Euro campaign which starts in September.
But Southgate believes the rest of the group can all progress in their careers at club level with many of them already fully established.
"We’ve started to see signs of that happening,” said Southgate, who was appointed as U21s boss in September 2013.
"When we started the campaign 18 months ago, there was probably only a quarter of the squad playing first-team football.
"Over the period of time, and some of them are two years older and towards 22 or 23 so you’d expect them to, but it’s completely the other way now and I’d say 80 per cent are playing first-team football."
Southgate also believes he saw improvement in the way in which his side approached their games in Czech Republic.
And it is the experience which many of the players have picked up during their formative years with club academies which Southgate claims has helped create English teams who can compete on a technical basis.
"I think clubs are doing a lot in that regard and it’s definitely a technically better player coming through our academy system," added Southgate.
"We had 60 per cent possession in both of the last two matches [Italy and Sweden] and against Portugal wasn’t much in between it, and it was similar in the World Cup last year.
"We’re not coming away from tournaments now saying England can’t keep the ball and from a youth development point of view there is progress in the type of player that is coming through."
Regardless of that though, Southgate didn’t want to make any excuses for his team’s exit from the Euros, after an impressive set of qualifying and warm-up game results.
So coping with the pressure of life in a tournament and the high-pressure games which come along with that is something the head coach is keen for all of English youngsters to experience.
"We have to take it on the chin," he continued.
"We haven’t got out of the group but if you were a club looking at it over a 40 game period, there’s a lot of progress in terms of how we’re trying to play and what we’re trying to do.
"But we’re at a three-game tournament and we have to do it in that immediate moment and we weren’t been able to do that.
"I believe there was a pride in playing for England and it was an invaluable experience for them.
"And I know we wanted it to be a winning experience, but to be in this more pressured environment for a lot of them it [Sweden] was the biggest game they had been involved in and they need exposing to these pressurised environments on a more consistent basis.
"That’s what the top international teams have had, club and country, so if we can keep coming to this environment and we can look at how we get games against the top opposition all of the time, that’s where you learn."