New Report Calculates the Size of the Internet Economy

Washington, D.C. – Today, the Internet Association released a new report on the Internet’s economic impact, which finds that employment in the Internet sector has doubled since 2007, nearing three million total jobs.  The Internet sector was responsible for an estimated $966.2 billion, or six percent, of real GDP in 2014.

“The Internet often has an ‘everywhere but nowhere’ feel, however, in reality, jobs in the Internet sector have doubled, contributions to real GDP have increased by more than two-fold, and employee wages far surpass the national average,” said Michael Beckerman, President and CEO of the Internet Association. “The results of this study are incredibly exciting for all of us who care about and advocate for the continued growth of the Internet economy, its companies, and the users they serve.”

The study provides conservative estimates for the total economic value of the Internet to the U.S. economy by analyzing product line receipts, or data tables demonstrating sector totals on earnings and related measurements, from several Internet Industries classified by the North America Industry Classification System (NAICS) over time. The study concludes with research on the Internet sectors impact in different states across the country.

Key findings include:

• The Internet sector adds significant value to the U.S. economy, specifically GDP, and does so on a scale that surpasses many more established sectors. In 2014, the Internet sector contributed 6 percent of real GDP ($966.2 B) – 2x more than their total contribution amount in 2007. From 2007 to 2012, the Internet sector increased its nominal value added to the economy by approximately 110.4 percent. In 2012, Internet industries contributed more to nominal GDP than a number of other major industries, including construction, computer and electronic products, broadcasting and telecommunications, and accommodation and food services.
• As the Internet sector continues to develop, employment opportunities increase. Government data shows the Internet sector increased its total number of employees by 107.9 percent over the five-year span from 1.38 million people in 2007 to 2.87 million people in 2012. During the same time span, the Internet sector’s total employment increased as employment in other sectors – including construction, computer and electronic products, and more – decreased.
• The Internet sector bolsters the health of the overall economy by delivering higher employee earnings and consumer surplus. The Internet sector has higher employee wages than the following industries: computer electronic products, chemical products, and broadcasting and telecommunications. Employees earned approximately $79,184, compared to the national average of $61,547. Furthermore, services associated with the Internet sector help both employees and consumers to save money by reducing transaction, search, and opportunity costs.
• This substantial increase in Internet sector value added clearly reflects the ubiquitous presence of the Internet throughout the U.S. economy. The Internet sector spans across thousands of different organizations that work on a variety of tasks including data processing, hosting and related services, wired and telecommunications carriers, wireless telecommunications carriers, and more.

Measuring the U.S. Internet Sector is the Internet Association’s first economic report. It relies solely on government data.

To learn more about Measuring the U.S. Internet Sector, click here.