Big data and the internet of things could add £322bn to the UK economy by 2020, new research from industry analysts and economists reveals today.
The internet of things – the network of everyday items fitted with electronics to allow them to collect and exchange data – could lead to £72bn of efficiency gains and 67,000 new jobs.
The research from the Centre of Economics and Business Research (CEBR) and SAS also said using new techniques to crunch massive data sets could provide a much bigger boost of £220m and 157,000 new jobs.
Adoption rates for big data analytics are estimated to rise from 56 per cent in 2015 to 67 per cent by 2020. Internet of things adoption will increase from 30 per cent in 2015 to 43 per cent by 2020. The biggest beneficiary is expected to be the UK’s struggling manufacturing sector. UK factory output declined last year and is still below pre-recession levels. Yet the report says there could be big improvements in supply chain management and customer intelligence.
Retail banks are expected to overtake telecoms companies as the biggest users of big data. The big data adoption rate for retail banks is forecast to be 81 per cent by 2020.
“Collecting and storing data is only the beginning. It is the application of analytics that allows the UK to harness the benefits of big data and the internet of things. Our research finds that the majority of firms have implemented between one and three big data analytics solutions,” said CEBR chief executive Graham Brough.
“However, the key is making sure those solutions are extracting maximum insight which is then turned into business actions. IoT is earlier in its life cycle, and will provide more data for analysis in areas that may be new to analytics, reinforcing the potential benefits to the UK economy.”