Since the invention of Facebook, people in almost every part of the globe have found easy and convenient ways of keeping up with friends and family, finding old friends, sharing special moments, connecting with people of common interest, planning events, and so much more. It is undeniable that Facebook has completely changed social communication.
The effects of this social platform, however, extend past the obvious social communication and connection benefits. Facebook has a significant economic impact all over the world. Through connecting people and businesses, stimulating innovation and lowering barriers to marketing, Facebook has unlocked many brand new opportunities. It supports the establishment of new businesses, growth of small and medium businesses (SMBs) and creation of employment opportunities.
It is no wonder that Facebook is among the most researched tech firms. The reports below represent the work of two studies on Facebook’s economic impact by two of the biggest consultancy firms in the world, Deloitte and PwC.
Facebook’s Economic Impact in Europe, 2012
In 2012, Deloitte carried out an analysis of the economic effects of Facebook in EU27 countries. According to the analysis, Facebook added approximately €15.3bn of economic value to the EU27 region. By then, the company supported 230,000 jobs and increased brand value of businesses to around €7.3bn across Europe.
Deloitte identified four areas in which Facebook has the most economic effect. These include:
- Facebook’s spending: Facebook spends money to pay wages, build/lease buildings and equipment, and pay suppliers. This addition of money into the European economy has far reaching effects.
- Business participation: Through Facebook advertising and more efficient customer service, companies are able to increase their revenue and build their brands.
- Social events planning: The platform is well known for facilitating the successful planning of social events. Money spent on food, drinks, venues, and other expenses during the events has a positive impact on local economies.
- Technology sales: Facebook was a major factor of consideration when buying a smartphone or tablet in 2012. More to this, Facebook drives up the consumption of fixed-line and mobile data.
Global Impact of Facebook in 2014
Deloitte released yet another report in 2014, this time focusing on the economic impact Facebook enabled around the world in 2014. The leading consultancy firm analyzed Facebook’s role as a catalyst for economic activity in business ecosystems composed of app developers, providers of connectivity, and marketers. Here are the key findings of the 2014 report:
- Globally, Facebook enabled the creation of 4.5m jobs and supported the creation of $227bn worth of economic value.
- The US captured the largest share of Facebook’s economic impact, which Deloitte estimated as $100bn.
- Improved engagements enabled economic impact in Central and South America valued at $21 bn.
- In the Europe, the Middle East and Africa (EMEA) region, the thriving app economy generated economic impact amounting to $13 bn.
- Facebook-motivated internet uptake and device purchases in the Asia-Pacific region were estimated to have contributed $13 bn of economic impact.
PwC’s 2018 report on the economic and social benefits of Facebook in Australia
In August 2018, Facebook engaged PwC Australia to explore the economic and social benefits of connecting on Facebook. The study involved Australian businesses and communities. In Australia, the use of Facebook and Instagram by businesses is an increasingly popular phenomenon. The PwC report revealed the following things about Facebook’s economic impact in Australia:
- In 2017, SMBs growth supported by their use of Facebook resulted to creation of 120,000 jobs.
- These employment opportunities generated an incremental economic value of $16.8bn. 24% of this value was retained in regional Australia.
According to the report, the measurable benefits of adopting and using Facebook and Instagram include:
- Overcoming trade barriers: SMBs are able to grow beyond geographical boundaries, employ more people, and drive economic growth.
- Low-cost access to global markets: Facebook business marketing has enabled entrepreneurs to find international demand even at early stages of the business lifecycle.
- Building resilient communities: New friendships formed on these social platforms have enabled donations to charitable movements as well as provision of support when there is adversity.
- Shifts in export dynamics: Unlike in earlier times when a business would only start exporting its goods after establishing itself domestically, young SMBs are now able to venture into foreign markets through greater global connectivity supported by Facebook.
There are endless ways in which Facebook has impacted the economy by supporting businesses. Online trading, for instance, is a field that continues to feel the effect of Facebook. The success of Forex systems for social trading depends how well connections on Facebook and other social sites are made.
Facebook has shown unwavering commitment to helping societies grow by supporting business growth, skills development and job. The company has entered into many partnerships with various governments, educational institutions, and NGOs to drive economic growth more effectively. Just as its power of social connections has enhanced personal lives, Facebook’s ability to impact economies will change lives today and in the future.