Faster broadband brings £3bn boost to London economy
The use of faster broadband by London s small and medium-sized enterprises (SMEs) taking up the Government s Broadband Connection Voucher Scheme will enable them to generate 2bn of additional sales within the first two years, 32,000 new jobs and to achieve just under 1bn cost savings, making London s voucher firms considerably more competitive and profitable. The combined sales increases and cost savings represent 1.7bn GVA, just over a 20% increase in GVA of London s voucher firms. The net benefits of this to the Greater London economy are estimated to be an additional 430m additional GVA and an additional 8,118 jobs.
This represents a positive economic return on investment of public funds1 into the scheme of 23.10 GVA per 1 invested in the scheme and a cost-per-job of 2,226. These findings are based on analysis of a comprehensive online survey of broadband voucher scheme recipients carried out for the GLA by Adroit Economics with support from Point Topic, The Fifth Sector and the University of Manchester.
Upgrading to faster broadband brings significant financial benefits to SMEs and results in substantial economic uplift. The findings of this survey, its analysis and assessment, provide strong evidence that the benefits to SMEs and resulting financial and economic impacts locally, regionally and nationally of the use of faster broadband are high, representing the equivalent of a third of current turnover. This is far higher than current global broadband literature suggests. Just under 450 firms took part in the survey and of the respondents that answered, 50% said that faster broadband had a transformational impact on their business.
Benefits to SMEs include cost savings, staff time savings, increased sales, improved staff skills and proficiency, and increased productivity of home and mobile workers.
The survey found that:
Average cost savings of 4.8% were gained
Average sales (turnover) increases of 10.5% are estimated
Staff time savings of 6.1% were made
Home working and mobile working productivity benefits of 11.1% were achieved.