Spending on advertising could help to drive a recovery in the UK economy with every £1 spent in the sector delivering a £6 boost to GDP, according to a new report.
This is equivalent of a near £100bn annual rise to the British economy on the basis of the £16.1bn spent on advertising in the UK in 2011.
The report by Deloitte, commissioned by the Advertising Association, has prompted the industry to push for the Government to focus on consumer spending and advertising as a means of helping power a recovery in the UK economy.
At the industry’s annual conference on Thursday, the Advertising Association trade body will call on the Government to do more to stimulate marketing spending by small and medium-sized businesses, resist regulations that threaten to stifle the sector such as European proposals to limit the use of data and boost the UK’s capabilities as a creative hub for producing advertising.
Tim Lefroy, chief executive of the trade body which represents advertisers, agencies, and the media, said: “In an economy where 60pc of GDP is rooted in household consumption, the means to bring products to market must not be forgotten.
“Advertising is sharpening competitiveness and acting as a spur to innovation. This report should prompt fresh thinking both by industry and in Government in support of our role.”
The UK advertising sector supports 550,000 jobs and is the world’s fifth largest behind the US, China, Japan, and Germany.
According to Deloitte’s report, the impact of advertising spending on the economy includes boosting competition between companies and therefore lowering prices for consumers, funding some of the UK’s most popular websites, and promoting innovation and new products.
Maria Miller, the Culture Secretary, who is due to speak at the conference, said: “Advertising has a huge impact on our economy and on our reputation abroad, helping to inspire growth, investment and tourism.
“The creative talent that makes Britain a world leader for fantastic film and TV, amazing special effects and wonderful music is the same talent that inspires and makes our advertising.
"We must nurture this talent, which is admired the world over, so as the advertising industry can realise its full potential as a key driver of economic growth.”