European advertising industry calls for a moratorium on further restrictions on advertising in order to make an accurate assessment of hidden costs due to these restrictions.
The first ever report that was made at EU level in order to find out exactly which social and economic contribution of advertising highlights the ability of this area to stimulate growth in the EU.
Advertising value, an independent study conducted by Deloitte to order World Federation of Advertisers and other industry partners, including the EACA (European Association of Communications Agencies) identified a multitude of benefits that advertising generates in the economy, market labor and civil society.
Using econometric modeling, the study showed that advertising creates some six million jobs in the European Union and generates revenues amounting to 4.6% of European GDP.
The study identified three key areas where advertising direct or indirect benefit of the European economy and EU citizens:
Economic benefits: study estimates that every euro spent on advertising brings seven other euro GDP, which means that 92 billion euros spent on advertising in 2014 generated revenue of 643 billion euros, meaning almost 4.6% of EU’s PIB .
The study also demonstrated that the advertising has a wider contribution to the economy, boosting competitiveness through information provided to consumers about products and services.
Competition, in turn, lead to innovation, driving companies to create differentiated products and services to face competition not only within the EU but also internationally.
Benefits on the labor market: advertising generates about six million jobs, equivalent to 2.6% of total employment in the EU in three areas:
– First, it is about people directly involved in local publicity. They represent 16% of the total of 5.8 million jobs generated by advertising. This does not include items associated with domestic production of advertising, so this figure is a conservative one.
– Secondly, there are jobs in the media and online, funded by advertising, including journalists, generators of content, but also those working in outdoor or television, for example. We’re talking about 10% of the 5.8 million jobs. Those occupying them have a safer workplace, and an average salary higher than in other sectors of the economy.
– Finally, there are jobs created in the economy due to advertising activity. They cover a wider area, from jobs that are supporting sales, till those that are backup advertising industries such as hospitality or tourism. This category also includes jobs generated by demand for the products and services driven by advertising.
In total, we are talking 74% of the 5.8 million jobs.