E-Commerce Commission Press Kit

Thus, in real terms, the expansionof the IT sector accounts for aneven larger share of overalleconomic growth in the mid-tolate-1990s. In recent years, ITindustries have been responsiblefor more than one-quarter of realeconomic growth (Figure 5). 20% of Real Economic Growth504030201026Figure 5. IT Contribution toReal Economic Growthactual20.918.44134.7estimated28.301992 1993 1994 1995 1996 1997Source: U.S. Department of CommerceEconomics and Statistics AdministrationEstimates based on Bureau of Economic Analysis and Census dataCompanies throughout the economy are betting on IT to boost productivity and efficiency. In the1960s, business spending on IT equipment represented only 3 percent of total business equipmentinvestment. In 1996, IT’s share rose to 45 percent (Figure 6). For some industries likecommunications, insurance and investment brokerages, IT equipment constitutes over threequartersof all equipment investment.0.50.40.3Figure 6. IT's Share of Business EquipmentInvestment Grows RapidlyCommercialInternetInformation technology supportshigh-paying jobs. In 1996, 7.4million people worked in ITindustries and in IT-relatedoccupations across the economy.They earned close to $46,000 peryear, compared to an average of$28,000 for the private sector.0.20.1019601962196419661968197019721974Source: U.S. Department of CommerceBureau of Economic AnalysisPC Introduction19761978198019821984198619881990199219941996* Inflation-adjusted investment in information processing equipment (office,computing, and accounting machinery, communications equipment,instruments, and photocopying equipment) as a share of total privateequipment investment.The impact of IT is also reflectedin the capital IT firms currentlyrepresent. The collective marketcapitalizations of five majorcompanies, Microsoft, Intel,Compaq, Dell and Cisco, hasgrown to over $588 billion in1997 from under $12 billion in1987, 21 close to a fifty-foldincrease in the space of a decade.6