Economic study finds internet contributes 1 million jobs, $392B in GDP in California

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Local businesses join coalition to share how their businesses benefit from the internet

April 5, 2022

SACRAMENTO, CA, – After a recent economic study finds direct links between the internet ecosystem and economic growth in California, California-based businesses join the national coalition Internet for Growth to help tell their individual stories of how they and their businesses have benefited from the internet ecosystem.

The Economic Impact of the Market-Making Internet, a study released every four years by the Interactive Advertising Bureau (IAB), finds that the internet contributed $392 billion to the state’s GDP in 2020, and accounts for more than 1.1 million jobs.

The growth in California’s internet jobs has been remarkable, going from just over 290,000 in 2012 to 1.1 million in 2020—a growth rate of 283 percent.

Recently, the IAB helped launched a national coalition, Internet for Growth, to help capture the stories of the millions of creators, entrepreneurs, and small businesses that rely on the ad-supported internet so that as policy makers consider regulations, they have a full understanding of how the internet is being used to help grow and transform our economy. Internet for Growth has more than 300 small business members including several based in California including AE Modern Construction in North Hollywood and Rancho Los Magueyes Mexican restaurant in Upland.

“This type of growth shows how critical the internet really is to our state’s economy and to businesses of every size and sector” said Diana Eloeva, director at AE Modern Construction in North Hollywood. “I joined the Internet for Growth coalition because I want policymakers to understand how critical the internet has been to my business, and that it’s important to every part of our state’s economy, whether that’s in Silicon Valley or the San Fernando Valley.”

According to the study, California alone is home to 30 Congressional districts that each have at least 10,000 internet-dependent jobs. In seven California Congressional districts, internet-related jobs employ at least five percent of the population.

This dramatic job growth can be attributed to a number of factors, including the internet’s ability to improve and refine advertising and marketing approaches, particularly for small businesses.

“The internet lowers the cost of entry to the marketplace for all businesses, but it’s particularly important for small businesses,” said Gustavo Rivera, Manager at Rancho Los Magueyes Mexican restaurant in Upland, California. “Small businesses and the self-employed created 38 percent of internet jobs—that’s more than medium (28%) or large firms (34%). This clearly shows how the internet democratizes business creation, allowing even independent restaurants and small businesses to compete.”

 

“The internet has been crucial to our survival during the pandemic,” said Rivera. “Through our website, we are able to take online orders, which was a lifeline for us when in-person dining was shut down. We use Instagram to advertise our food and cocktails to our customers, as well as announce promotions and send out news and updates. These tools have been critical for the survival of our business over the last two years.”

Nationally, the study finds that the internet economy grew seven times faster than the overall total US economy, creating more than 7 million jobs in the last four years.

About Internet for Growth
Internet for Growth, an initiative of the Interactive Advertising Bureau, supports the transformative role the advertising-supported internet plays in empowering America’s small businesses, helping entrepreneurs bring their ideas to life. Supported by a diverse community of over 700 IAB members including marketers, agencies, publishers, platforms, and ad tech providers, as well as hundreds of small businesses and creators, we highlight the benefits the internet delivers to local economies, expanding opportunities for innovators to reach markets far beyond their neighborhoods. Our work ensures people understand the limitless opportunity the internet provides for creativity and commerce, fair competition, and connecting with consumers on mutually shared values and interests, no matter the background or geography.

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The internet levels the playing field, lowering barriers for entry, and democratizing ownership, enabling even the smallest storefronts to drive economic results in every state across the U.S. Subscribe to stay up to date with the latest news and stories from Internet for Growth.