{"id":43508,"date":"2013-08-01T22:58:59","date_gmt":"2013-08-01T20:58:59","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=43508"},"modified":"2013-08-02T08:47:13","modified_gmt":"2013-08-02T06:47:13","slug":"fix-the-internet-boost-employment-economist","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/internet\/43508\/fix-the-internet-boost-employment-economist\/","title":{"rendered":"Fix the internet, boost employment: economist"},"content":{"rendered":"<p>A slow internet in South Africa\u00a0with low penetration rates is hindering the ability to create jobs in the country, according to\u00a0<a title=\"Kevin Lings\" href=\"http:\/\/businesstech.co.za\/forum\/showthread.php\/8685-Kevin-Lings\">Kevin Lings<\/a>, chief economist at financial services company, <a title=\"Stanlib\" href=\"http:\/\/businesstech.co.za\/forum\/showthread.php\/1768-Stanlib\">Stanlib<\/a>.<\/p>\n<p>Lings&#8217; views echo the sentiment of\u00a0\u00a0<a title=\"DA\" href=\"http:\/\/businesstech.co.za\/forum\/showthread.php\/1696-DA-Democratic-Alliance\">DA<\/a>\u00a0shadow minister of communications,\u00a0<a title=\"Marian Shinn\" href=\"http:\/\/businesstech.co.za\/forum\/showthread.php\/4592-Marian-Shinn\">Marian Shinn<\/a>, and follows a recent<a title=\"http:\/\/mybroadband.co.za\/news\/broadband\/82599-cold-hard-truth-about-broadband-in-south-africa.html\" href=\"http:\/\/mybroadband.co.za\/news\/broadband\/82599-cold-hard-truth-about-broadband-in-south-africa.html\" target=\"_blank\">\u00a0Akamai report<\/a>\u00a0which revealed that\u00a0South Africa has one of the lowest average internet connection speeds in the world.<\/p>\n<p>In Akamai\u2019s report, State of the Internet, SA\u00a0had the lowest average connection speed of all European, Middle-Eastern, and African (EMEA) countries surveyed.<\/p>\n<p>The report also revealed the following:<\/p>\n<ul>\n<li>SA ranks 80th worldwide for average internet connectivity speed;<\/li>\n<li>126th for peak connectivity speed worldwide; and<\/li>\n<li>69th globally for the average speed of broadband connectivity with only 8% able to achieve speeds of 4 Mbps or more. This is far below the global average of 46% and less than a tenth of the global leader, Switzerland, at 88%.<\/li>\n<\/ul>\n<p>The DA pointed out that the World Bank has identified broadband connectivity as a key catalyst for economic growth, with every 10% increase in connectivity enabling a 1.38% growth in Gross Domestic Product (GDP).<\/p>\n<p>According to Lings, job creation is the number one objective in SA. He says that we make mistakes by assuming that big\u00a0corporates are the way forward to absorbing large numbers of employees. He says that initially they do, but &#8220;then they learn to do more with less people&#8221;.<\/p>\n<p>&#8220;South Africa unequivocally needs to expand small businesses,&#8221; he said, adding that new business will come from service related industries, not from traditional industries like mining and manufacturing.<\/p>\n<p>He explained that that there is a lower barrier to entry for internet businesses with start up costs, and indeed operating costs potentially lower. &#8220;But, we need access to the internet, and we need speed,&#8221; he said. &#8220;We cant get where we need to be without it.&#8221;<\/p>\n<p>Lings said that in every country where there was an increase in the access to the internet, along with increased speeds, &#8220;you will see an increase in employment,&#8221; created by the vast spin-offs. &#8220;Its such an obvious win,&#8221; the economist said.<\/p>\n<p>The economist pointed out in a research note that global Internet access has grown by almost 600% since the year 2000 to an estimated 2.5 billion users, and is expanding by roughly 200 million new users a year.<\/p>\n<p>He underlined South Africa&#8217;s penetration rate at\u00a0a mere 17.5% of the population.<\/p>\n<p>&#8220;The low level of penetration and low speeds means that there is a big gap we are missing in the economy,&#8221; Lings said.<\/p>\n<p>In May, Stanlib identified several research\u00a0reports which concluded that access to the internet plays a positive and significant role in stimulating economic activity.<\/p>\n<p>A 2009, a report by the University of Munich into the relationship between access to broadband Internet and economic growth reached two important conclusions.<\/p>\n<p>Firstly, it found that after introducing Broadband Internet, countries achieved 2.7% to 3.9% higher GDP per person. Secondly, every 10% increase in broadband Internet penetration brings a 0.9% to 1.5% increase in the growth of GDP per person.<\/p>\n<p>Moreover,\u00a0in 2011, the <a title=\"McKinsey Global Institute\" href=\"http:\/\/businesstech.co.za\/forum\/showthread.php\/8686-McKinsey-Global-Institute\">McKinsey Global Institute<\/a>\u00a0researched the Internet\u2019s impact on growth, jobs and prosperity &#8211; focusing on 13 countries that account for more than 70% of global GDP.<\/p>\n<p>McKinsey concluded that\u00a0the Internet has contributed 10% of the countries&#8217; growth over the past 15 years, and 21% of their growth in the past five years.\u00a0Consequently, the Internet now represents 3.4% of GDP.<\/p>\n<p>Around 53% of this is in the form of consumer spending, while private investment in Internet-related technologies and foreign trade accounts for 31%, with the public sector accounting for the remaining 16%.<\/p>\n<p>\u201cThis means that in these countries the internet has a greater share of GDP than agriculture, utilities, communication, education and mining,\u201d Stanlib said.<\/p>\n<h3 class=\"my-4\">More on South Africa&#8217;s internet<\/h3>\n<p><a title=\"SA internet holding back economic growth\" href=\"http:\/\/businesstech.co.za\/news\/internet\/42874\/sa-internet-holding-back-economic-growth\/\"><strong>SA internet holding back economic growth<\/strong><\/a><\/p>\n<h3 class=\"my-4\"><a title=\"SA Internet population close to 14 million\" href=\"http:\/\/businesstech.co.za\/news\/internet\/42800\/sa-internet-population-close-to-14-million\/\"><strong>SA Internet population close to 14 million<\/strong><\/a><\/h3>\n<p><a title=\"Broadband speeds: how does SA stack up?\" href=\"http:\/\/businesstech.co.za\/news\/broadband\/42702\/broadband-speeds-how-does-sa-stack-up\/\"><strong>Broadband speeds: how does SA stack up?<\/strong><\/a><\/p>\n<p><a title=\"How South Africa is failing at the Internet\" href=\"http:\/\/businesstech.co.za\/news\/internet\/38729\/how-south-africa-is-failing-at-the-internet\/\"><strong>How South Africa is failing at the Internet<\/strong><\/a><\/p>\n<p><a title=\"SA\u2019s dismal entrepreneurial record\" href=\"http:\/\/businesstech.co.za\/news\/general\/36481\/sas-dismal-entrepreneurial-record\/\"><strong>SA\u2019s dismal entrepreneurial record<\/strong><\/a><\/p>\n<p><strong><a title=\"Permalink to SA business and innovation status\" href=\"http:\/\/businesstech.co.za\/news\/it-services\/35521\/sa-business-and-innovation-status\/\" rel=\"bookmark\">SA business and innovation status<\/a><\/strong><\/p>\n<p><strong><a title=\"Permalink to Government failing ICT in SA\" href=\"http:\/\/businesstech.co.za\/news\/government\/35542\/government-failing-ict-in-sa\/\" rel=\"bookmark\">Government failing ICT in SA<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A slow internet in South Africa with low penetration rates is hindering the ability to create jobs in the country.<\/p>\n","protected":false},"author":10,"featured_media":1125,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9882],"tags":[26,5932,1482],"class_list":["post-43508","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-internet","tag-headline","tag-kevin-lings","tag-stanlib"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/43508","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=43508"}],"version-history":[{"count":9,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/43508\/revisions"}],"predecessor-version":[{"id":43526,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/43508\/revisions\/43526"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/1125"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=43508"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=43508"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=43508"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}