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The
impacts from investments in broadband infrastructure and
broadband-enabled applications are measurable and
significant. We have demonstrated that the local
economic growth and secondary investment enabled by
broadband is 10 times the initial broadband
investment and the contribution to Gross Domestic
Product (GDP) is 15 times the initial investment.
The
economic impact from an investment in broadband are
twofold:
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The immediate economic effects come from the
construction of the broadband infrastructure. The
affected residents, businesses and organizations
then invest in the skills, capacity, tools and
facilities for participating in the digital economy;
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The other effects are
more long-term. Investment in broadband
increased the retention and expansion of existing
businesses and organizations within the local area.
As businesses became more profitable and
competitive, they expanded, which increased local
employment, local training, local spending and
investment in facilities and equipment. These
outcomes flow through to the rest of the local
economy creating a multiplier effect from the
initial broadband investment.
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The
table below provides two examples of the economic
impact of broadband investments (infrastructure and
applications such as e-business, tele-health and remote
learning) from studies we conducted in Canada in 2004
and 2003. Broadband impact data on new revenues, reduced
costs, and new jobs were collected directly from
businesses and organizations, and Input-Output impact
models were used to calculate the contribution to GDP:
|
Nature/amount of
investment |
Infrastructure
only |
Infrastructure
and
e-learning,
tele-health |
|
Initial amounted invested |
$10m |
$10m |
|
Leveraged
investments |
$116m |
$101m |
|
Total investment |
$126m |
$111m |
|
Additional GDP |
$164m |
$150m |
|
Jobs created |
2,100 |
4,800 |
|
Tax revenues
generated |
$61m |
$32m |
Infrastructure investment provides a healthy return in
its own right - even for relatively small and rural
communities. Broadband infrastructure construction has
job impacts immediately in the local economy like
typical shovel-ready investments. More significantly, it
increases drastically the retention and expansion of
businesses and organizations.
The
positive effects from broadband infrastructure become
even more important in times of economic uncertainty,
especially for smaller, rural communities who often have
less economic diversity and resilience to withstand the
effects of an economic slowdown. The availability of
broadband gives enterprises, in smaller or rural
communities, the options to expand their market reach
and thereby becoming more efficient during difficult
economic times. Individuals can use broadband find new
opportunities, including supplemental education and
skills training, out-of-region employment through
tele-working (working from home), and business
start-ups.
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