Technology and Economic Growth

Technology and Economic Growth

At a time of slowed growth and continued instability, many countries are looking for policies that will stimulate growth and create new jobs. Information communications technology (ICT) is not only one of the fastest growing industries – directly creating millions of jobs – but it is also an important enabler of innovation and development.

The number of mobile subscriptions is approaching global population figures, with 40% of people in the world already online. In this new environment, the competitiveness of economies depends on their ability to leverage new technologies.

The Information communications technology sector is and is expected to remain, one of the largest employers. In the US alone, computer and information technology jobs are expected to grow by 22% up to 2020, creating 758,800 new jobs. In Australia, building and running the new super-fast National Broadband Network will support 25,000 jobs annually. Indeed, the growth in different segments is uneven. In the US, for each job in the high-tech industry, five additional jobs, on average, are created in other sectors. In 2013, the global tech market will grow by 8%, creating jobs, salaries and a widening range of services and products.

Findings from various countries confirm the positive effect of Information communications technology on growth. For example, a 10% increase in broadband penetration is associated with a 1.4% increase in GDP growth in emerging markets. In China, this number can reach 2.5%. The doubling of mobile data use caused by the increase in 3G connections boosts GDP per capita growth rate by 0.5% globally. The Internet accounts for 3.4% of overall GDP in some economies. Most of this effect is driven by e-commerce which is people advertising and selling goods online.

Numerous public services have become available online and through mobile phones. The transition to cloud computing is one of the key...