Faster internet may be the key to reducing unemployment

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High speed internet has become vital for modern life. Considering the reliance of many people on high-quality internet connections for work, school and socializing, it is no exaggeration to conclude that a good internet connection is a necessity just like water. and electricity.

However, the quality of American Internet connections is often lacking. Depending on the exact measure, the United States is in the middle of the pack among developed countries when it comes to the quality of its offer Internet access. In addition, if you are American you are probably paying a little more for the Internet which is a little slower than connections in other countries.

As with so many things, the situation is made worse by income inequality. While 86 percent of households earning more than $ 70,000 per year have a broadband connection, this percentage drops to 56 percent for those earn less than $ 40,000. Stressing the importance of this is news to study published in the American Economic Journal: Economic Policy it shows how low-income families have benefited from broadband access they previously lacked.

A life without broadband? Perish thought.

The study, carried out by George zuo at the University of Maryland, examined families who participated in the Internet Essentials (IE) program offered by Comcast as part of an agreement they made with the U.S. government to reduce fears of possible negative side effects of ‘a merger.

It turns out that giving people cheap and affordable internet is good for them.

The program offered “15 megabits per second (Mbps) high-speed internet for $ 9.95 per month to families with children eligible for a free and discounted lunch through the National School Lunch Program (NSLP).” The discounted price is $ 20 to $ 30 lower than typical non-promotional prices for equivalent speeds. The program also offers ancillary benefits such as fee waivers and educational materials to alleviate the other financial and psychic costs of going online from home.

Since the program was only available in areas where Comcast operated and for families with children receiving food assistance while having incomes below 185 percent of the federal poverty line, it was possible to compare the results. economics of this group with a similar group that did not receive the same benefits. Comparative employment rates over time are presented in the following graph.

A graph comparing the employment rate of registered households and in areas covered by the IE program. Notice how quickly the employment rate climbs for those who could get the program versus those who couldn’t. (Credit: GW Zuo, Am Econ J Econ Policy, 2021.)

It turns out that giving people cheap and affordable internet is good for them. As noted, those eligible for the program who received discounted Internet access from Comcast were much more likely to find employment than those in the same region who were not eligible for the program and those who might have qualified for the program. program but lived in areas not served by the provider.

Dr Zuo explained in his study that “the availability of Internet Essentials resulted in a 0.9 percentage point (1.6%) increase in the likelihood of a qualifying low-income person having a job. After adjusting for participation rates, I calculate that enrollees were 8.1 percentage points (14.3%) more likely to be employed. “

The economic benefits have been calculated to be approximately $ 2,202 per registered household, more than four times the cost of providing Internet service at a discount.

Cheap internet is not a panacea

contrary to previous studies By linking better internet access to people who find well-paying jobs, this study found no evidence that the jobs people accessed were of significantly higher quality than those they might otherwise have found.

Yet most people cite the Internet as the most important tool they have for finding a new job. Improved Internet access not only makes job search easier, but for many positions, it makes job search possible in the first place. Dr Zuo concludes his article by reaffirming the importance of the internet for finding work:

“Those who can’t afford monthly broadband subscriptions are inherently limited as they navigate the modern job market. They are also at risk of falling behind beyond the labor market. The Internet plays a central role in education, access to goods and services, communication, etc.

This article originally appeared on our sister site, Big Think. Read the original article here.

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