New Study Reports on Contributions of IT Sector to Global Economic Recovery
Research from 52 countries including the UK forecasts the creation of 5.8 million new jobs worldwide and 75,000 new businesses over the next four years.
October 5, 2009 Global IT research firm International Data Corporation (IDC) and Microsoft Corp. today released the results of global research measuring the information technology (IT) industry’s contributions to local economies.
The IDC study, commissioned by Microsoft, investigates the contribution of IT to gross domestic product (GDP), job creation in the IT industry, employment in the software sector, formation of new companies, local IT spending, and tax revenues in 52 countries, representing 98 percent of total worldwide IT spending. The research found that in the UK, Microsoft and its ecosystem of local partners, vendors and service providers are a major catalyst of local economic growth and opportunity, during both the current economic difficulties and recovery.
“In this fundamental economic reset, innovative technologies will play a vital role in driving productivity gains and enabling the creation of new local businesses and highly skilled jobs that fuel economic recovery and support sustainable economic growth,” said Steve Ballmer, CEO of Microsoft. “Countries that foster innovation and invest in infrastructure, education and skills development for their citizens will have a major competitive advantage in the global marketplace.”
Key Findings on the IT Industry for the UK
| • | Spending on IT in will reach £50.2 billion in 2009, and between now and 2013 is expected to grow 1.8% a year, compared to GDP growth of -0.1% a year. |
| • | The IT market will drive the creation of nearly 2500 new businesses and 78,200 new jobs between the end of 2009 and the end of 2013. Most of the new companies will be small and locally owned organizations, and the jobs will be highly skilled, high-quality jobs. That represents growth of 1% a year from now through 2013, while total employment will shrink by -0.7%. |
| • | In 2009, local partners in the Microsoft ecosystem will generate more than £17.8 billion in revenues for themselves. To generate these revenues, they will invest £6 billion in development, marketing, training and sales in the UK economy. |
| • | The Microsoft ecosystem, defined as local companies that develop and/or sell products that run with or on Microsoft software, or that service and distribute Microsoft software, is a critical economic catalyst in every country where Microsoft operates. For every pound that Microsoft generates in 2009, local companies in this ecosystem will generate £8.84. |
“Over the past 20 years, we’ve seen transformative power in how investments in IT innovations foster economic growth,” said Robert D. Atkinson, Ph.D., founder and president of the Washington, D.C.-based Information Technology and Innovation Foundation. “Continued innovation and investment in information technology will help jump-start recovery from the current recession and will significantly contribute to the growth of employment and new businesses.”
“Partnering with Microsoft has helped my company weather the current economic storm and continue to meet the needs of my customers,” said David Kilpatrick, Managing Vice President, Hitachi Consulting. “Being part of the IT industry has created opportunities for my company and helped me contribute to the growth of my community.”
Full results of the study can be found at http://microsoft.com/economicgrowth
About IDC Methodology
This study applies IDC’s Economic Impact Model, which assesses the IT industry’s impact on job creation, company formation, local IT spending and tax revenues in addition to assessing Microsoft’s partner ecosystem. The study’s spending figures accounted for hardware, software, services and data networking expenditures by consumers, businesses, governments and educational institutions within each country. Tax revenue figures were based on potential VAT or sales tax revenues from the sale of hardware, software or services, as well as business and personal income taxes and social taxes. IT employment included the number of people employed (full-time equivalent) in hardware, software, services or channel firms, and those individuals managing IT resources in an IT-using organization (e.g., programmers, help desk, IT managers). All data was cross-checked against published information and census data available from government sources and validated by local government officials. A report on IDC’s methodology is available at http://microsoft.com/economicgrowth
About Microsoft
Founded in 1975, Microsoft (Nasdaq: “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.
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