The Internet Is 20% Of Economic Growth

mckinsey report internet

Photo: McKinsey Global Institute

The Internet is huge. Most people can agree on that at this point. But most people don’t realise how big it is in relation to the global economy. That’s what a new McKinsey report, released this morning at the eG8 Forum, looks at. 

And it turns out, the Internet is a huge driver of economic growth. Internet as a sector is about 3% of GDP, or bigger than agriculture or energy, and represents over 20% of economic growth in the past 5 years, and growing. For every job that the Internet destroys, 2.6 new net jobs are created. 

The whole report is downloadable as a 50-odd page PDF here, but we’ve pulled out the best charts for you. They’re fascinating. 

The Internet has a 3.4% share of GDP in the countries McKinsey analysed

That's bigger than agriculture or utilities (which tend to be subsidized to the hilt, by the way)

The Internet is a big contributor to GDP

But where it's most striking is how much it contributes to GDP growth: 21% in mature countries, more in the past 5 years than previously.

In high-growth countries it's a lower percentage of growth--but Internet growth in absolute amounts is still huge

Small businesses who use the Internet a lot do much, much better than their competitors

Most of the value of the Internet is actually captured by traditional companies. For most established businesses, the Internet is more of an opportunity than a threat.

This chart shows the surplus accruing to consumers from the Internet per user per month. Pretty big.

Countries that create strong Internet ecosystems reap huge economic benefits

Here's what McKinsey says is most important to build an Internet ecosystem

The US and Sweden have the best Internet ecosystems

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