New Public First research for IAB UK puts digital advertising's contribution at £175bn and 2.6 million jobs, with £242bn in reach by 2035 if the policy climate allows.
Digital advertising now contributes £175bn a year to the UK economy and supports 2.6 million jobs, according to research published today by IAB UK, and could add another 1.2 million jobs and reach £242bn by 2035 if the policy climate allows it. The study, carried out for the trade body by the consultancy Public First, puts the sector’s growth since 2022 at £46bn, or 35 per cent, which it says is ten times the growth rate of the wider economy over the same period.
The headline figure is gross value added, the activity the report says digital advertising supports across the businesses that buy it, not the payroll of ad tech firms and agencies. On that basis the 2.6 million jobs amount to around 8 per cent of the UK workforce, up from 2 million four years ago. Digital advertising drives £118bn of annual sales for UK businesses, of which £53bn goes to small and medium-sized firms, double the 2022 figure, as Marketing Week reported.
The forward projections lean heavily on AI. Public First estimates that a 10 per cent improvement in return on ad spend from AI tools would be worth £80bn in extra sales over the next decade, that agentic buying could lift sales by £13bn by 2035, and that the creator economy could grow from £800m in 2025 to £12bn. Its survey of digital advertising businesses found 95 per cent already use AI and 82 per cent say it has raised productivity.
Every one of those projections comes with a condition. The report’s authors say the growth will only arrive in the right policy environment, which for IAB UK means a framework for responsible AI, support for skills and investment, and rules that let businesses build here while protecting consumers. Sinead Coogan Jobes, the trade body’s head of policy and public affairs, said digital advertising was “already one of Britain’s great growth stories” but that “that economic prize cannot be taken for granted”, as Decision Marketing reported.
Read this as a lobbying document, because that is what it is. Industry-commissioned impact studies exist to put a big number in front of ministers before decisions on AI regulation, online advertising rules and the Budget, and £242bn is a number designed to be quoted. The methodology is standard and the direction of travel is not in doubt, but the jobs figure counts everyone whose employer benefits from digital advertising, which is a much wider net than the industry itself.
What is more useful for marketers is the shape of the growth. The creator line matches what IAB UK found last week, when UK creator advertising passed £1bn, and the agentic buying figure is the first serious attempt to price a change that is already arriving, with Amazon preparing to sell ads inside ChatGPT. If the industry’s own forecast is that AI does the buying and creators do the making, the question for agencies is what they charge for. For how the buying already works, our programmatic explainer is the place to start.
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