A country's economy is often shaped and adorned by the basic infrastructure that she wears. Not only is it indicative of a nation's fiscal health and well-being but is also a yardstick that enables the measure of its potential and prowess to develop further. In today's post-information age, the traditional infrastructure in the form of water supply, roads, rails, electricity etcetera has become the one that is extremely important to sustain the economic growth of the country. However, the information and telecommunication technology infrastructure has proven to be the one that actually drives the economic growth.The human capital
This memo studies the impact of telecommunication infrastructure and services on the economy of Australia. One of the most amazing aspects of the Australian case is that the impact of telecommunications on its GDP has been becoming evident at twice the rate at which telecommunications has been actually growing. This has doubly enhanced the significance of telecommunications which has led to a further growth and development in the sector. The entire chain reaction has led to some explosive growth indices not only in the telecommunications sector but in the overall economy as well.
Starting first up, let us look at the employment scenario. A recent study by the Govt. of Australia showed that approximately 100,000 Australians work in the telecommunications industry and the rate (at which people are being employed by the industry) has been increasing every year by about 11%. These are some phenomenal numbers and clearly explain why Australians are the 4th most intensive users of information and communication technologies in the world.
This has a non-obvious but a very significant implication. Since the industry has been aggressively driving related employment, there has been a tremendous boost in the education and vocational training industry. More and more individuals have been investing in education and training of technological, financial and regulatory aspects of telecommunications in general. This, as a result, is driving a whole new parallel industry of hi-tech education and training which now is responsible for 12.8% of country's GDP.
I drive Me
Second, the industry has been responsible for its own growth. Unlike the conventional infrastructures, a telecom infrastructure's value and economy increases exponentially with the increase in the no.of users of the infrastructure and with the no.of services offered over it. So as more and more people and services have attached them to the network, the increase in significance and value of the network has led to an increased investment in equipments, hardware, software, economic and policy analysis of telecommunications. This has led to an increased maturity and research in each of these sectors and hence led to creation of markets in several cases. For instance, SMS and MMS related services and advertising comprises of almost 33% of revenue for an average telecom operator in Australia. This has further attached people and services to the network in general and hence the industry has been driving itself.
Side Effects..
Also, the telecommunications industry has been aggressively driving labor productive and labor intensive growth across diverse industry domains. Over the past 5 years there has been an indirect impact on the growth of some of the basic industries. This has mainly been due to facilitation of enhanced efficiencies in day to day businesses, communication costs, enterprise networks etc. Adjacent graph illustrates the impact:
This memo studies the impact of telecommunication infrastructure and services on the economy of Australia. One of the most amazing aspects of the Australian case is that the impact of telecommunications on its GDP has been becoming evident at twice the rate at which telecommunications has been actually growing. This has doubly enhanced the significance of telecommunications which has led to a further growth and development in the sector. The entire chain reaction has led to some explosive growth indices not only in the telecommunications sector but in the overall economy as well.
Starting first up, let us look at the employment scenario. A recent study by the Govt. of Australia showed that approximately 100,000 Australians work in the telecommunications industry and the rate (at which people are being employed by the industry) has been increasing every year by about 11%. These are some phenomenal numbers and clearly explain why Australians are the 4th most intensive users of information and communication technologies in the world.
This has a non-obvious but a very significant implication. Since the industry has been aggressively driving related employment, there has been a tremendous boost in the education and vocational training industry. More and more individuals have been investing in education and training of technological, financial and regulatory aspects of telecommunications in general. This, as a result, is driving a whole new parallel industry of hi-tech education and training which now is responsible for 12.8% of country's GDP.
I drive Me
Second, the industry has been responsible for its own growth. Unlike the conventional infrastructures, a telecom infrastructure's value and economy increases exponentially with the increase in the no.of users of the infrastructure and with the no.of services offered over it. So as more and more people and services have attached them to the network, the increase in significance and value of the network has led to an increased investment in equipments, hardware, software, economic and policy analysis of telecommunications. This has led to an increased maturity and research in each of these sectors and hence led to creation of markets in several cases. For instance, SMS and MMS related services and advertising comprises of almost 33% of revenue for an average telecom operator in Australia. This has further attached people and services to the network in general and hence the industry has been driving itself.
Side Effects..Also, the telecommunications industry has been aggressively driving labor productive and labor intensive growth across diverse industry domains. Over the past 5 years there has been an indirect impact on the growth of some of the basic industries. This has mainly been due to facilitation of enhanced efficiencies in day to day businesses, communication costs, enterprise networks etc. Adjacent graph illustrates the impact:
The phenomenon
I can actually go on and on describing the impact of telecommunications on Australia's economy. It is just phenomenal. The brief indicators described in the memo give an overall picture of the nature and potential of the impact. Also estimations of the future impact look even more encouraging.
“ - Boost in the national output by 3.7% over the next decade
- increase real investment by 4% and consumption by 3%
- increase employment by 5.3% and ral wages by 4.44%
- contribute 3% to an appreciation of real exchange rate” [1]
As evident, the value of impact telecommunications has had n Australian economy can only be realized by studying the impact of its value.
References:
All figures and statistics and [1] taken from “Impact of Telecom in Australia” by Australia Telecom Society, Center for Strategic Economic Study, Australia 2006.
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