While the U.S. jobs picture may be bleak, the proliferation of Facebook and mobile technology applications has spawned an entirely new industry – dubbed the “App Economy” — that has added at least 182,000 new jobs and contributed more than $12.19 billion in wages and benefits to the U.S. economy this year, according to new research from the University of Maryland’s Robert H. Smith School of Business.
Using more aggressive estimates, the Facebook App Economy created a total of 235,644 jobs, adding a value of $15.71 billion to the economy.
We’ve certainly seen evidence of this at our annual events (Digital East is coming up Sept. 28-29 at Tysons Corner, VA, with a stellar lineup of Internet, social media, marketing and IT gurus participating). The Raleigh, NC, Internet Summit is not far behind in November. Despite the multi-year economic downturn, the events draw full-house crowds, many of those in attendance looking for insider tricks of the very new social media marketing trade, SEO, and digital media.
Professors at the Smith School’s Center for Digital Innovation, Technology, and Strategy have for the first time been able to quantify that Facebook’s App Economy has created more than 53,000 new jobs in software companies who make applications for the Facebook Platform. Apps include everything from productivity tools to popular games like “Farmville” that users interact with on Facebook.
Il-Horn Hann and Siva Viswanathan, co-directors of the center and associate professors of information systems, measured the number of people employed to build, develop and consult on Facebook applications. Hann and Viswanathan used data on apps provided by Facebook.
The App Economy has also led to job creation at businesses that supply app developers, and in sectors that reap the benefits of increased household spending by app developers and suppliers from new app economy jobs. Hann and Viswanathan conducted an economic impact analysis to estimate that between 129,000 to more than 182,000 people are employed in jobs supported by the app economy.
The researchers calculated the sum of wages and benefits earned by those employed in and supported by the app economy to total between $12.19 billion to $15.71 billion.
“Our findings confirm that social media platforms have created a thriving new industry,” said Hann. “As Facebook and other platforms grow, we will continue to see job growth and the ripple effects of these advances in the U.S. economy.”
The results of the study are published in a new white paper, available online at www.rhsmith.umd.edu/digits/.
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