NCPA - National Center for Policy Analysis

Survey Assesses The Internet's Contribution To Productivity

June 6, 2000

A new survey from the University of Texas sponsored by Cisco Systems says workplace efficiency and productivity have soared as companies start incorporating the Web into their day-to-day operations. The benefits of Internet use are just beginning and will make even greater contributions to productivity in the future.

  • The latest report in the twice-yearly survey found that revenue associated with Internet-related employees jumped 19 percent from 1998 to 1999 -- and is expected to keep climbing.
  • Companies integrating the Internet into their operations were 2.5 times more likely to see productivity gains and more than 2.5 times more likely to see market-share growth than companies not utilizing the Internet.
  • The report cautions, however, that employees can cut into productivity by using the Internet for personal e-mails, stock trading, general surfing and shopping -- costing corporate American about $54 billion a year, according to Ted Ladd of the software firm Websense.

Experts say there is a lag time between innovation and realization of benefits, because it takes time for businesses to figure out how to streamline the process and maximize the benefits. Thus productivity gains from the Internet are expected to increase in the future.

Source: Dina Temple-Raston, "Productivity Boost Just Beginning," USA Today, June 6, 2000.


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