One of the key benefits often cited for investment in broadband connectivity is that it reduces unemployment. While that seems likely, it is important to test every hypothesis, and new research from the University of Tennessee at Chattanooga and Oklahoma State University suggests that, indeed, broadband reduces unemployment and that the impact is especially felt in rural areas.
“Having access to high speed broadband, which is propelled by fiber deployment, is the great equalizer for many communities throughout America, especially those in rural areas,” Lisa R. Youngers, the President and CEO of the Fiber Broadband Association, said in a press release. “This study shows that high speed broadband can jumpstart local economies by lowering unemployment rates and creating new opportunities.”
Here are some highlights from the report:
- In studying 95 counties in Tennessee from 2011 to 2016, researchers found that access to high speed broadband can significantly reduce unemployment rates, especially in rural communities.
- Counties with access to high speed broadband have an approximately 0.26 percentage point lower rate of unemployment compared to low speed counties.
- Early adoption of high speed broadband could reduce unemployment rates by an average of 0.16 percentage points per year.
- Counties lacking high speed broadband have smaller populations and population density, lower household income, and a slightly smaller proportion of people with at least a high school diploma.
This at least partially contradicts a report released last August by the American Action Forum. The AAF, which self-defines as a “center-right” policy advocacy group, found that broadband adoption is four times more useful than availability in explaining unemployment, median household income, the change in employment and the rate of population change in rural areas.
It’s a bit of a cloudy picture. It is clear that two interrelated issues – the extent to which broadband availability can reduce unemployment and how best to measure the impact – must be sorted out when service providers, municipalities and related entities are considering investment.
Image courtesy of flickr user Sean MacEntee.
