The ICT sector is expected to create 1.5m new jobs in Europe by 2010, with SMEs seen as playing the biggest part in future ICT employment growth.
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A study by analyst IDC on behalf of Microsoft suggested that 60% of the new jobs will be software-related, with a third using Microsoft platforms.
IDC also estimates that the jobs growth will create around £96bn in new tax revenues for governments. The report was published to coincide with a Microsoft SME Innovation Day in Brussels.
There are currently around 22 million SMEs across Europe, said IDC, employing almost 120 million people. This contributes 57% of pan-European gross domestic product.
IDC said in its report, "If SMEs can be stimulated into adopting new technologies more rapidly, and creating innovative products more competitively, Europe's position as a leading player in the global economy can be assured."