A new study by Deloitte for Facebook has shown that in 2011 Facebook supported 232,000 jobs and enabled an estimated €15.3 billion of economic activity in the European Union and Switzerland.
Deloitte’s report, “Measuring Facebook’s economic impact in Europe” breaks down Facebook’s economic impact across Europe and also in France, UK, Germany, Spain and Italy.
Chris Williams, Deloitte Economic Consulting partner said: “Facebook embodies a new generation of social media organisations that have significant global impact and create economic value through enabling ecosystems of businesses to flourish. Traditional narrow measures of economic impact are limited and it is critical to consider the broader impact of Facebook in allowing other parties to create value across the economy.”
Speaking at a Deloitte conference in Munich, Facebook’s chief operating officer Sheryl Sandberg said: “Today’s report shows that Facebook is about a lot more than sharing pictures or keeping up with friends; increasingly social media means growth and jobs.
“As the Deloitte study highlights, social media is proving particularly valuable for small and medium sized businesses, which form the backbone of the European economy.”
In the UK alone, Facebook supported 35,200 jobs and contributed an estimated €2.6 billion to the economy, the report highlights. It also supports €1.37 billion in “business participation effects” in the UK as businesses use Facebook’s pages to promote their brand, raise awareness, advertise and generate new business. In particular small businesses benefit from such a developed customer relations management system at no cost. “Business participation” enabled by Facebook supports 18,400 jobs in the UK.
In the EU Facebook enables €7.3 billion of broad economic impacts through business participation supporting 111,000 jobs, the report says.
Through “platform effects”, notably the app economy servicing the Facebook platform and social activities, Facebook has enabled €561 million of economic activity in the UK.
The report points out that Facebook generates value by giving software developers a platform to develop apps for users, generating revenue and stimulating innovation. It also creates value by making it easier for users to organise events and invite larger numbers of attendees, which in turn can lead to greater expenditure than would have been the case otherwise. This activity generates 7,500 jobs in the UK. When widened to the whole of the EU Facebook enables €2.2 billion of broad economic impacts through platform effects supporting 33,000 jobs.
Facebook has supported increased technology sales through increased demand for devices and broadband connections, supporting €659 million in technology sales and 8,800 jobs in the UK. Across the whole of the EU Facebook enables €5.5 billion in technology sales, with 85,300 jobs associated with supporting this.