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The deployment of high-speed broadband technology has brought economic benefits worth £3 billion to small and medium-sized enterprises (SMEs) in London, a new report has found.
Research by Adroit Economics, with support from Point Topic, The Fifth Sector and the University of Manchester, noted that companies taking advantage of the government's Broadband Connection Voucher Scheme stand to generate up to £2 billion in additional sales in the first two years, as well as bringing 32,000 new jobs to the capital's economy. At the same time, the technology will also deliver around £1 billion in cost savings.
Of the nearly 450 firms that took part in the research, half agreed that faster connectivity had a 'transformational' impact on their business. In addition to cost savings, typical benefits to SMEs include staff time savings, increased sales, improved staff skills, and increased productivity for home and mobile workers.
On average, businesses that took advantage of the voucher scheme saw costs decrease by 4.8 per cent, while turnover was estimated to have increased by an average of 10.5 per cent.
Meanwhile, estimated staff time savings of 6.1 per cent were reported, while productivity benefits of 11.1 per cent were achieved as a result of better home and mobile working capabilities.
Iain Bennett, managing director of The Fifth Sector, stated that SMEs that adopt fast broadband will notice an immediate change in their way of working, as employees take advantage of the opportunity to improve their skills and "work smarter".
He added: "The technology unleashes latent productivity, which provides a lasting and growing benefit to the individuals and firms concerned – a really important finding at a time when businesses and policymakers alike are striving to find new ways to boost economic performance, increase jobs and improve skills."
Dr Steve Sheppard, managing director of Adroit Economics, also stated that the research highlights how having faster broadband brings significant economic uplifts to both individual businesses and the wider economy.
"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," he said. "This is far higher than current global broadband literature suggests."
It is estimated that for every £1 invested in the London broadband voucher scheme, the economy will see an overall benefit worth £23.70, illustrating how relatively small investment in better connectivity can have major, far-reaching implications for businesses.
