Hooton: “This report demonstrates the sustained strength of the digital economy. The internet has produced solid and steady growth for more than a decade and is a driving force of the U.S. economy.”
Washington, DC – Internet Association today released a new set of quarterly indicators for the internet sector that, for the first time, will provide regular insights into the size and shape of the fastest growing part of the American economy. The IA Industry Indicators report, or 3I Report, features a quarterly deep-dive on a specific aspect of the internet economy, micro- and macroeconomic indicators, a Digital Price Index that tracks inflation for digital goods and services, and a sentiment survey.
“We need better measures of the internet sector, and this report is an important step in building out our understanding of the digital economy,” said IA Chief Economist and Head of Research Dr. Christopher Hooton. “This report directly tackles the challenges of the 21st century economy by delivering new insights into America’s most dynamic economic sector – the internet. I’m excited to expand our current understanding of the sector with the new economic findings in the 3I Report.”
Key findings from the inaugural issue of the 3I Report, which draws on data from Q2 2018, include:
- Competition & consumers drive industry decision-making. In an analysis of publicly-traded internet companies over the past five years from 2013 to Q2 2018, IA identified the top five risks across all companies based on the number of times they were cited across every company’s public reports. Three of those top five risks speak directly to the need to innovate and keep customers happy. The top risks to the industry were: 1) Product & Services Development, 2) Economic & Financial Conditions, 3) Competition, 4) Market, and 5) Customer Satisfaction & Subscription Rate.
- Hiring is up and separations are down in the internet sector. Hires increased by 18.43 percent and openings increased by 18.02 percent in Q2 2018. Simultaneously, separations decreased by 1.99 percent in the quarter. These figures indicate an increasing workforce and an increased retention of those workers within the industry.
- New Digital Price Index (DPI), which tracks a set of popular internet based services, shows cost of digital goods is increasing faster than national inflation rate. The DPI was up 5.28 percent year-over-year, which is above overall inflation rate of only 2.1 percent.
“This report demonstrates the sustained strength of the digital economy,” said Hooton. “The internet has produced solid and steady growth for more than a decade and is a driving force of the U.S. economy.”
To read the quarterly report, click here.