IT departments and the industry that supports them have been hit hard by the current recession. President-elect Obama is proposing a $775 billion dollar economic stimulus plan to help create new jobs and to get our economy rolling again.
The nonprofit Information Technology and Innovation Foundation (ITIF) is urging the new administration to spend a part of that money on IT infrastructure and related technologies. This could help the IT industry by adding or retaining jobs and improving our IT digital infrastructure.
The report notes an investment in America’s digital infrastructure could create or retain nearly 1 million new jobs by investing in three key areas. Broadband networks, Health IT and in the Smart Power Grid. The report by ITIF notes that investment in these three IT infrastructure projects will:
- Contribute to significant, immediate, direct and indirect job growth in our economy.
- Create a “network effect: throughout the economy that in some cases will double the number of directly created jobs.
- Provide a foundation for long term benefits, including government cost savings, economy-wide productivity, and an improved quality of life for Americans.
ITIF finds that investments in America’s digital infrastructure will spur significant job creation in the short run. Specifically, ITIF estimates that spurring an additional investment of $30 billion in America’s IT network infrastructure in 2009 will create approximately 949,000 U.S. jobs.
Investment in America’s Digital Infrastructure
The report looks at three areas of investment in America’s digital infrastructure that will create U.S. jobs and improve our IT infrastructure as a result of these investments.
1. Broadband Networks
An investment of $10 billion in 1 year in broadband networks would support an estimated 498,000 new or retained U.S. jobs for a year. High-speed broadband Internet access is viewed as an essential infrastructure for our global economy. Broadband access is critical to the economic growth in communities and regions throughout our country.
The report recommends a three-tiered set of investments focused on addressing three broadband policy goals.
- Getting broadband to unnerved areas
- Expanding network speeds in areas currently served by first-generation broadband (3 Mbps or less)
- Spurring increased adaption of broadband by households
2. Health IT
An investment of $10 billion in 1 year in health IT could create as many as 212,000 new or retained U.S. jobs for a year. The recommended investment is primarily in the Electronic Health Record (ERH) system. EHR systems are believed to increase physician efficiency and reduce costs, as well as promote standardization of care and many other health care related improvements.
The network effect of the investment can lead to expansion of Web 2.0 technologies, networked home medical devices and the use of RFID smart cards and sensors. The benefits would lead to better health care, higher productivity and lower costs for everyone connected to our health care system.
IT promises to be a major part of our nation’s health care system, with technologies such as e-prescribing and computer order entry improving patient safety and saving thousands of lives every year. Modernizing our health care system also depends on harnessing the vast quantities of data locked up in paper medical records. Tools such as rapid-learning networks will enable researchers to spot dangerous side-effects from drugs or other treatments, as well as to identify effective treatments more rapidly.
3. Smart Power Grid
An investment of $50 billion over 5 years ($10 billion per year) would create as many as 239,000 new or retained U.S. jobs for each of the 5 years on average. The central idea behind a smart power grid is using two-way communications, sensors and advanced IT to create an intelligent and connected power grid that is “smart”.
A smart power grid will allow us to deliver power more efficiently and more reliably than our existing power grid. Utilities can utilize real-time data from sensors and advanced metering to better understand supply and demand requirements, spot failed or failing equipment and better manage resources.
The plan also recommends installing “smart meters. Smart meters can be as simple as ones that provide remote connect/disconnect functions and automated metering. More advanced smart meters could integrate with a home or business network to “talk” with household appliances and other powered units.
It is important to recognize that building the smart grid will require much more than just investment in smart meters. Utilities must implement IT throughout their entire operation, from advanced back office servers to automating substations to integrating renewable energy sources into the existing grid. 61 Communication networks must be integrated with the system, such as through wired broadband, including over power lines, cellular networks, or Wi-Fi. At the end-points, consumers must implement tools, such as smart thermostats, smart appliances, and other energy management tools.
An investment in our digital infrastructure will not just produce or retain present IT jobs now, but for many years to come. These investments are critical to improving an infrastructure system that is vital to future U.S. growth and expansion. While this is a significant investment, with cost savings and an immediate and sustained impact on our economy, these IT investments are smart.
These investments could impact and improve many IT departments and IT related industries. Investments such as these could lead to a significant expansion of present IT services as well as the creation of new IT services and innovations.
For more information visit the ITIF web site and read the report in PDF format “The Digital Road to Recovery: A Stimulus Plan to Create Jobs, Boost Productivity and Revitalize America”. There is also a 84 minute video presentation or you can download the MP3 audio.