Michigan Boost In Broadband Adoption Good For State Economy: New Report

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Fiber optic cables. Wikimedia Commons photo from Sandia National Laboratories

Fiber optic cables. Wikimedia Commons photo from Sandia National Laboratories

LANSING — Tuesday, in conjunction with the 2013 Governor’s Economic Summit, Connect Michigan is releasing a report on Broadband’s Economic Impact in Michigan. Broadband access and adoption helps fuel the economy. Michigan residents conduct $17.1 million in online transactions with Michigan businesses and spend nearly $1.1 billion in online sales with these businesses annually.

“Broadband connections at home and work help fuel Michigan’s economy,” said Connect Michigan State Program Manager Eric Frederick. “We, as a team, will continue to reach out to provide business leaders, decision-makers, and residents with insight on broadband’s potential as a platform for economic development and as a tool for cultivating a technology-oriented Michigan workforce.” 

According to a Connect Michigan survey released last week, residential broadband adoption has increased by 10 percentage points, increasing from 61 percent in 2011 to 71 percent in 2012. This increase bodes well for Michigan’s economy as broadband helps entrepreneurs take advantage of the Internet to sell goods or services through home-based businesses, and more subscribers are using their home broadband service to buy products and services from Michigan businesses. 

Beyond the direct potential for economic growth, broadband also helps strengthen Michigan’s work force by giving Michiganders opportunities to improve and continue their educations. In addition, through teleworking and the use of the Internet at work, Michigan is able to keep its most talented employees and prevent the “brain drain” that occurs when highly skilled employees are forced to move out of rural areas, or out of the state, to find gainful employment. 

Among the findings from this survey:
* Connect Michigan estimates that a one percentage point increase in broadband penetration could create or save approximately 12,388 jobs statewide.
* Statewide, 804,000 Michigan e-Learners report that they have some college education but have not yet earned a bachelor’s degree. Census estimates suggest if these Michigan residents use online learning to earn their bachelor’s degrees, they could bring in a total of $3.8 billion in additional household income to the state.
* Approximately 1.16 million Michigan residents take advantage of the Internet to sell goods or services through home-based businesses, through individual online sales, and via auctions. This accounts for $467 million in annual revenue statewide.
* Approximately 732,000 employed Michigan residents are teleworkers. Statewide, teleworkers save $362.8 million annually.
* Broadband empowers Michigan workers search for jobs or find better jobs. The majority of low-income Internet users in Michigan (55 percent) use the Internet to search for or apply for jobs.

“Maximizing broadband deployment and adoption is essential to the economic development fabric of any Michigan community,” said Tremaine Phillips, director of Innovation and Region Building of the Prima Civitas Foundation. “The distribution and availability of high-speed broadband will increasingly be the determining factor for communities looking to attract new businesses and strengthen the competitiveness of existing firms.”

Despite the personal and economic benefits of broadband, approximately 29% of the adults in Michigan still do not have broadband at home. The most common reasons are lack of interest and cost. Connect Michigan is working with public and private partners to help increase broadband access, adoption, and use throughout the state. One of its programs, called the Connected Community Engagement Program, is in more than twenty communities across the state helping area leaders develop technology action plans.

The findings in this report are from the Connect Michigan 2012 Residential Technology Assessment. Connect Michigan surveyed 1,201 adults across the state in late 2012. The data are available via an interactive widget on its Web site. Connect Michigan conducted this survey as part of the State Broadband Initiative grant program, funded by the U.S. Department of Commerce, National Telecommunications and Information Administration, and by the American Recovery and Reinvestment Act of 2009.

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