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Deloitte study finds that Facebook has an overall economic impact of €2.6 billion in the UK

24 January 2012

  • Deloitte’s study highlights that Facebook supported 35,200 jobs in the UK in 2011
  • Across the EU and Switzerland, Facebook enabled an economic impact of €15.3 billion in 2011, supporting 232,000 jobs

A new study by Deloitte for Facebook has shown that in 2011 Facebook supported 35,200 jobs in the UK and contributed an estimated €2.6 billion to the economy.  

Deloitte’s report,‘Measuring Facebook’s economic impact in Europe’ breaks down Facebook’s economic impact across Europe and also in France, UK, Germany, Spain and Italy.

Chris Williams, Deloitte Economic Consulting partner said: “Facebook embodies a new generation of social media organisations that have significant global impact and create economic value through enabling ecosystems of businesses to flourish. Traditional narrow measures of economic impact are limited and it is critical to consider the broader impact of Facebook in allowing other parties to create value across the economy.”

The report examines Facebook’s economic impact through narrow effects*, caused by its day-to-day activities within Europe, and broad effects, related to value from third parties as a result of the Facebook ecosystem.

Across the whole of the European Union and Switzerland the report shows that Facebook has supported 232,000 jobs and enabled an estimated €15.3 billion of economic activity in 2011.

Speaking at today’s DLD conference in Munich, Facebook’s Chief Operating Officer Sheryl Sandberg said: "Today's report shows that Facebook is about a lot more than sharing pictures or keeping up with friends; increasingly social media means growth and jobs.

“As the Deloitte studyhighlights, social media is proving particularly valuable for small and medium sized businesses, which form the backbone of the European economy.

The impact of social media is a bright spot in challenging times, but growth won’t happen on its own. We need to make sure that we invest in the right education, training, technology and networks so that social media can continue to drive innovation and economic growth."

The report highlights:

  • Facebook supports €1.37 billion in ‘business participation effects’ in the UK as businesses use Facebook’s pages to promote their brand, raise awareness, advertise and generate new business. In particular small businesses benefit from such a developed customer relations management system at no cost. ‘Business participation’ enabled by Facebook supports 18,400 jobs in the UK.
  • When widened to the whole of the EU, Facebook enables €7.3 billion of broad economic impacts through Business Participation supporting 111,000 jobs.
  • Through ‘Platform effects’, notably the app economy servicing the Facebook platform and social activities, Facebook has enabled €561m of economic activity. Facebook generates value by giving software developers a platform to develop apps for users, generating revenue and stimulating innovation. It also creates value by making it easier for users to organise events and invite larger numbers of attendees, which in turn can lead to greater expenditure than would have been the case otherwise. This activity generates 7,500 jobs in the UK. When widened to the whole of the EU Facebook enables €2.2billion of broad economic impacts through Platform effects supporting 33,000 jobs.
  • Facebook has supported increased technology sales through increased demand for devices and broadband connections, supporting €659 million in technology sales and 8,800 jobs in the UK. Across the whole of the EU Facebook enables €5.5billion in technology sales, with 85,300 jobs associated with supporting this.

Ends

Notes to editors
Facebook has commissioned Deloitte to assess its economic contribution in Europe. This study assesses Facebook’s economic impact across the EU27 with a focus on United Kingdom, Germany, France, Italy, Spain and Ireland. The economic impact Facebook contributes is assessed for the year 2011. This study, and its associated analyses, were completed between November 2011 and January 2012.

*The narrow impact includes Facebook’s economic contribution proportionate to the level of employment generated in 2011 (direct effects). It also includes the impact felt in associated supply-chain industries who supply to Facebook (indirect effects) and consumer spending by staff (induced effects).

UK economic impact

Impact Jobs (000) Value added 2011 (€)
Direct 0.1 26.3
Direct & Induced 0.5 5.6
Narrow Total 0.6 32.0
     
Paid Advertising 2.1 160.8
Customer communication 0.1 9.9
Brand Value 16.1 1,206.7
Business Participation Total 18.4 1,377.5
     
App Economy Effects 7.0 522.5
Social Plumbing Events Effects 0.5 38.9
Platform Effects Total 7.5 561.4
     
Technology Sales – Devices 1.7 128.5
Technology Sales – Broadband Consumption 7.1 531.3
Technology Sales Total 8.8 659.8
     
Grand Total 35.2 2,630.7

About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.

Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.

The information contained in this press release is correct at the time of going to press.

Member of Deloitte Touche Tohmatsu Limited.

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Laura Parsons
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Deloitte LLP
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