I have been meaning to read the latest McKinsey surveys for weeks. I think the rain brought me a little time today. It was worth the wait. The first report (Internet Matters: The Internet’s Sweeping Impact on Growth, Jobs and Prosperity) is full of interesting facts.
To start – the Internet accounts for, on average, 3.4 percent of GDP in the 13 countries studied. The report goes on to say that the countries that have been using the Internet the longest are using it best – or at least are seeing the greatest percentage of GDP coming from the Internet, which indicates that the countries that are just getting into the Internet should also see greater percentage of GDP coming from the Internet in the future.
The impact on jobs is also pretty impressive. They report that while the Internet destroys some jobs, it creates 2.6 jobs for every job destroyed. So there’s some potential growth there too. Now if we can just try to make sure that we can reach out to the folks who lose the original job to get re-employed.
The report indicates that consumer surplus generated in the US by the Internet was $64 million in 2009. They also talk about supply side economics. The US fares very well, which I’m glad to hear but I have to wonder how much of our “success” is simply based on size and longevity with the Internet. The research reports that the US Captures more than 30 percent of the global revenues and more than 40 percent of net income.
There was a note of recommendation that I think is important to note…
Create an attractive business environment. The context in which business operates is critical to the growth of the Internet ecosystem and will hold back its growth if the environment does not encourage expansion of usage, encouragement of innovation, and business investment and participation. To ensure such an attractive environment requires ongoing assessment of the frameworks that govern access, usage, protection of various rights, and consideration of security.
Its vital advice for anyone looking to promote economic growth in a business, community, county, state or country. The report goes on to make some specific suggestions:
- Public decision makers should act as catalysts to unleash the Internet’s growth potential
- All business leaders, not just e-CEOs, should put the Internet at the top of their strategic agenda
- All stakeholders should take part in a fact-based, public-private dialogue
The second report (An Economy That Works: Job Creation and America’s Future) is much less about broadband – much more about jobs. There are some sobering statistics.
- We need to find employment for 7 million unemployed people
- The US will need to create 21 million new jobs in this decade to put unemployed Americans back to work
- Up to 1.5 million workers with bachelor’s degrees or higher in 2020. At the same time, nearly 6 million Americans without a high school diploma are likely to be without a job.
The report offers a few suggestions for improvement:
- Skill: Develop the workforce of tomorrow.
- Share: Harness globalization to create more US jobs.
- Spark: Grow emerging industries and new businesses and reignite innovation.
- Speed: Clear the path for investing and hiring.