Two men man the EPB Fiber Optic control room following an FCC that allowed gigabit internet service to expand beyond the Chattanooga area.
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Bento Lobo

Chattanooga added or saved nearly 4,000 jobs in the first five years after EPB launched high-speed gigabit-speed broadband in 2011, according to a new economic study of the impact of broadband service.

Researchers from the University of Tennessee at Chattanooga and Oklahoma State University calculate that the jobless rate in counties that have adopted high-speed broadband service are 0.26 percentage points lower than counties without such high-speed Internet, controlling for all other factors. As an early adopter and the pioneer of the first citywide gigabit-speed service in the Western Hemisphere, Hamilton County has enjoyed an extra jobs boost as the first "Gig City," creating or maintaining an extra 3,950 jobs from 2011 to 2016, the new study found.

"Our research shows that investments in faster broadband can have significant employment effects, especially in rural areas," said Dr. Bento Lobo, a professor of economics at UTC and the lead author of the 31-page study on the broadband impacts on economic growth across Tennessee's 95 counties. "Our results consistently show that access to faster speed results in a decrease of 0.2-0.3 percentage points in unemployment which can be in the hundreds of jobs in some counties."

Dr. Lobo said faster broadband "facilitates efficiency, heightens productivity, and likely fosters innovation."

Early adopters of the new technology such as Chattanooga's electric and broadband utility provider EPB further reduce unemployment rates by 0.16 percentage points. The study found counties lacking high speed broadband have smaller populations and population density, lower household income, and a slightly smaller proportion of people with at least a high school diploma.

Proponents of faster broadband tout the results of the study as another indicator of the value of investing in making fiber optic upgrades of telecom systems, especially in rural areas of the country.

"Having access to high speed broadband, which is propelled by fiber deployment, is the great equalizer for many communities throughout America," said Lisa R. Youngers, president and CEO of the Fiber Broadband Association. "This study shows that high speed broadband can jump start local economies by lowering unemployment rates and creating new opportunities."

EPB, began offering telecommunications services a decade ago when it borrowed $220 million to build a citywide fiber-optic smart grid aided by an $111.6 million federal grant. EPB has signed up more than 100,000 customers for its telecom services, which now boasts Internet speeds up to 10 gigs.

"We are proud to see that this study highlights some of the great work we have done to establish Chattanooga as America's first Gig City," said Katie Espeseth, vice president of new products at EPB Fiber Optics.

The study comes as Tennessee Gov. Bill Lee prepares to address the leaders building broadband for rural Tennesseans at the Tennessee Telecommunications Association (TTA) convention Tuesday in Franklin, Tennessee.

According to Broadband Now statistics, Tennessee is the 23rd most connected state in the country with 172 internet providers.

Lee, who touts himself as a champion for rural areas of the state, will deliver the keynote address to the group of independent and cooperatively owned companies that connect almost 30 percent of the state with broadband and related services, primarily in rural areas of the state.

Backed by USDA grants, TTA members ave invested nearly $240 million in rural broadband connections, including eight of the 13 Broadband Accessibility Grants the state issued, totaling almost $8.5 million of the $15 million awarded. Those state grants are expected to bring broadband access to 3,751 unserved homes and businesses in 10 Tennessee counties now lacking such service.

"I think (Gov. Lee's) visit makes clear the significant emphasis he puts on the rural areas TTA members serve, and it underscores the importance of providing world-class internet connections in those areas," TTA Executive Director Levoy Knowles said of Lee's planned visit Tuesday.

Contact Dave Flessner or at 757-6340.