UK can create 700,000 jobs with £15bn IT investment

The UK government can create and retain 700,000 jobs if it invests £15bn on IT to improve the broadband, utility and transport infrastructures.

The UK government can create and retain 700,000 jobs if it invests £15bn on IT to improve the broadband, utility and transport infrastructures.

It would also improve the quality of everyone's lives, according to a study published by the London School of Economics and Political Science (LSE) and the Information Technology and Innovation Fund (ITIF).

The report comes at a time when the government is eager to stimulate the economy and minimise unemployment. "Rising unemployment in the UK threatens the welfare of hundreds of thousands of individuals, and exacerbates the current economic crisis," said the report.

Governments can stimulate economic activity and recruitment in all sectors through increasing the amount of money it spends on public projects. These projects, traditionally infrastructure improvements, create jobs, which pay wages. These wages are spent on products and services, which create other jobs and so on.

The LSE and ITIF report, UK's Digital Road to Recovery, revealed that increasing investment in IT infrastructures will pay back more than traditional infrastructure projects such as road building.

"Spurring investment in the UK's infrastructure is an effective, immediate strategy to compensate for the downturn. However, while investments to improve the country's traditional physical infrastructure, such as roads, bridges and sewer systems, are necessary and important, investments in certain parts of the UK's information and communication technology (ICT) resources, or digital infrastructures, will have a greater positive impact on jobs, while at the same time laying the groundwork for sustained productivity and innovation," said the report.

The report outlines how a total of £15bn investment in broadband networks, intelligent transport systems and smart power grids would create and retain 700,000 jobs.

The report said if the government spent £5bn on getting broadband to unconnected areas, increasing network performance and encouraging household take-up, it would support about 280,000 jobs. Some 76,000 jobs for technicians and back office staff would be created in the telecommunications industry to support the new infrastructure. A further 134,500 jobs would be created indirectly when the 76,000 new workers spent their earnings at restaurants and retail stores for example. The remaining 69,500 would be created by what the report describes as the "network effect" of broadband. This network effect is the process by which the existence of broadband spurs other industries such as computer equipment manufacturing.

A £5bn investment in intelligent transport systems would create a total of 188,000 jobs, the report said. The creation of intelligent transport systems requires integrating information and communications technology with the transport infrastructure vehicles and users. The sharing of information would allow people to use transport networks more efficiently, with increased safety and less impact on the environment.

Another £5bn spent on developing a smart power grid would create 235,000 jobs. Smart power grids use two-way communication, sensors and advanced ICT. Utilities could use real-time data from the power grid to understand supply and demand requirements better, spot failed or failing equipment, and better manage their resources. IT used in smart grids includes the adoption of ubiquitous automation systems, sensors and monitoring devices, data collection systems and communications systems.

Read more on Networking hardware