Organisation for Economic Co-operation and Development office
By Eromosele Abiodun
The Organisation for Economic Co-operation and Development (OECD) has singled out improved online business transactions as the force behind global economic transformation.
The OECD is a Paris, France-based organisation with over 100 member nations, which promotes policies that will improve the economic and social well-being of people around the world.
In its latest report on new ‘Measuring the Internet Economy Outlook 2012,’ it noted that the internet has played a huge role in helping to build businesses and economies in different parts of the world.
The OECD said that internet firms continue to drive growth and job creation in the Information Communication Technology (ICT) industry, with fast-rising demand for mobile services helping to boost revenue and investment in research and development.
OECD also predicted total worldwide ICT spending to reach $4.4 billion in 2012, of which 58 per cent ($2.57 billion) is on communications services and equipment, 21 per cent ($910 billion) on computer services, 12 per cent ($ 539 billion) on computer hardware and nine per cent ($ 385 billion) on software.
The report, authored by OECD’s Taylor Reynolds, stressed that the top 250 ICT firms, ranked by revenue, boosted employment by four per cent in 2010 and six per cent in 2011, adding that hiring grew fastest among Internet firms who increased employment by 29 per cent in 2011, largely driven by Amazon.com and Google adding 50 per cent more employees between 2010 and 2011.
The report added that internet intermediaries represented at least 1.7 per cent of business sector value added in 2009; this is compared to the publishing industries at one per cent and the motion picture and sound recording industries at 0.4 per cent.
According to OECD, the IT services industry weathered the 2009 downturn better than manufacturing, quickly rebounding to positive growth in early 2010, adding that this was likely due to increasing specialisation in ICT services across OECD countries, while manufacturing has shifted to lower-cost production areas.
“The strength of the services sector is partially the result of the increasing role ICTs play in helping businesses become more efficient. Firms may look to ICTs to cut costs during downturns, creating a continued demand for ICT services as other budgets are cut.
“The same is true for the telecoms sector, which continued to perform strongly during the crisis, as households and individuals today consider them essential services and prefer to cut back on other expenses,” the organisation said.