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The UK would be £11bn worse off without Google

Posted on 21/09/2015 by Anna Davies

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Google has delivered an uplift of between £11bn and £28bn to the UK economy, the US giant has claimed, by helping the nation's businesses to rake in digital revenues through its search engine and other online products.

In a new report, which was compiled by accountancy firm Deloitte, Google has laid out its economic contribution to the UK, which includes the creation of at least 210,000 jobs.

Many new roles in digital advertising and search engine optimisation may not have been created without the rise of Google, the search giant claimed.

Google has also been instrumental in helping UK businesses to export, and innovate domestically, according to the study.

The report states six key areas where Google claimed it has given the UK a competitive advantage:

 

  • Google’s search and advertising products allow businesses to connect with consumers all over the world, stimulating export revenues
  • Content creators can use Google’s content distribution services to reach larger audiences and make money online
  • Brand advertisers, agencies and publishers make money through Google's display advertising services
  • Through Google's Android platform, smartphone application developers connect to billions of consumers
  • Businesses benefit from Google’s cloud-based office productivity suite, from Gmail to Google Docs
  • Google's digital initiatives help businesses, entrepreneurs and students to increase their digital literacy

 

The report follows a torrid few years in the media for Google, which has come under fire for diverting profits outside the UK, reducing its tax bill.

Last year, the Chancellor announced that he was introducing a new levy to prevent this form of tax avoidance, which has since become known as the "Google tax".

According to Google, the positive impact of its business on the UK far outweights the negative.

“Google is a growth engine for British businesses large and small, helping them unlock their digital potential," said Eileen Naughton, Google’s managing director for UK and Ireland.

"Our technology helps companies be discovered by new customers, boosts productivity by helping teams collaborate better, and helps content creators get paid for their creativity.

"As people live their lives digitally, the traditional rules of doing business are changing and the opportunities for fast growth are powered by the web.

"Whether you are a start-up founder, a freelancer specialising in writing speeches, or cupcake enthusiast, Google can help you tap into the digital marketplace and serve customers across geographies.”

The report breaks down the effect of each of its products on the UK economy.

For example, YouTube content creators generated an economic impact between £55m and £105m in the UK in 2014, the report stated, creating between 1,000 and 2,000 jobs.

YouTube to introduce paid-for content this year

British businesses using Google Search and AdWords generated between £11bn and £28bn from their ad spend with Google on these services last year, which created up to 530,000 jobs across all sectors, Google claimed.

The study estimated that for every £1 invested in online advertising, businesses receive £3.40 to £8 in gross advertising profits.

Some commentators on Twitter agreed that Google has been a positive force for UK businesses.

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