The London School of Economics argues in a report released on Wednesday that a stimulus package aimed at IT would generate a multiplier effect with benefits for the whole economy. The timing of the report, The UK's digital road to recovery, could scarcely be better.
Barely 10 days after business secretary Peter Mandelson made all the right noises about 'removing barriers' in the hi-tech economy and securing 'more high-value jobs', the LSE has fleshed out those sentiments with hard figures.
An additional investment of £15bn in the UK's IT infrastructure would create about 700,000 jobs, with smaller businesses accounting for more than half those posts, according to the joint LSE-Information Technology & Innovation Foundation report. The authors propose dividing that investment between broadband, intelligent transport and the smart power grid. They say productivity, competitiveness and quality of life would all improve.
Against a bleak economic backdrop, the calls for investment in IT are growing. In the same week that Lord Mandelson's Department for Business, Enterprise & Regulatory Reform published its New industry, new jobs report on investing for an upturn, the National Endowment for Science, Technology and the Arts said the UK could lose out by up to £44bn per year if the government fails to invest in healthcare, green technology and digital media.
In America, part of president Barack Obama's stimulus bill for the country's economic regeneration involves investment in broadband and emerging technologies. On Wednesday, the European Commission adopted a preliminary draft EU budget for 2010 containing a further €2.4bn (£2.2bn) for broadband and energy infrastructure.
In the depths of recession, it is only right that the issue of technology investment has come to the fore. Technology helped drive the shift from post-war austerity to renewed affluence. The LSE report underlines that carefully targeted investment could again hasten a recovery and set up the country in readiness for better times.
But the LSE's report is not only well timed, it also addresses exactly the sort of debate we should be having. The report demonstrates that technology is not just an end in itself, but a conduit to improvements in the economy and the way people live. Investments of the type described by the report's authors could help the country reinvent itself.