Economic and Labour Market Impacts of BDUK Voucher Schemes

The UK Government has published a detailed evaluation report on the economic and labour market impacts of the Building Digital UK (BDUK) voucher schemes. This report, titled Economic and Labour Market Impacts – GOV.UK, provides insights into how these vouchers influenced business performance, employment, and productivity.

Bottom Line

The Gigabit Broadband Voucher Scheme (GBVS) showed stronger results compared to the Rural Gigabit Connectivity (RGC) scheme.

Key Findings of the Evaluation

The analysis shows that vouchers generated clear and positive outcomes for supported businesses. Employment grew significantly faster than in comparable unsupported firms, with effects of around 7–8 percentage points above the counterfactual. Turnover impacts were even stronger, with additional growth of over 15 percentage points in some cohorts. Productivity, measured as turnover per employee, declined across the economy during the pandemic but fell less sharply for voucher-supported firms. This indicates that vouchers helped businesses remain more resilient in challenging conditions.

These impacts were sustained for a period following support, with positive effects on employment and turnover evident for up to three years after vouchers were received. By the fourth year, differences between voucher-supported businesses and control groups had largely converged. The positive impacts were driven largely by the Gigabit Broadband Voucher Scheme (GBVS). GBVS-supported businesses consistently outperformed their comparators on both employment and turnover, with effects strengthening over time. By contrast, the Rural Gigabit Connectivity (RGC) scheme showed weaker or, in some cases, negative results.

Business Size and Sector Impacts

Impacts also varied according to the type of business supported. Medium-sized firms (51–250 employees) recorded the strongest employment growth, while micro-businesses saw the largest turnover gains. By sector, manufacturing and real estate recorded the most positive results, while knowledge-intensive services were broadly in line with the average. Rural businesses performed similarly to the overall sample, showing neither stronger nor weaker effects.

Vouchers also contributed to the creation of higher-quality jobs. Workers moving into voucher-supported businesses received wage increases of 15.3% on average, compared with 8.5% for other job movers. Applying this premium to the estimated number of additional jobs created suggests earnings benefits with a present value of around £175 million (2024 prices). Almost all of these benefits are attributable to GBVS (£174 million), with RGC contributing around £1 million.

Limitations and Broader Context

The evaluation also examined whether vouchers reduced unemployment at the local level using claimant count data. The analysis found no clear or consistent impacts: in most years there were no significant differences between voucher areas and controls, and trends were dominated by wider economic conditions, particularly the sharp rise in unemployment during the Covid-19 pandemic and subsequent recovery. This suggests that any effect of vouchers on unemployment was limited and difficult to isolate from broader labour market changes.

Verified Source Evidence

Verified source excerpt from UK Government (GOV.UK):

Department for Science, Innovation & Technology This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: [email protected] . This publication is available at https://www.gov.uk/government/publications/final-evaluation-of-bduk-legacy-vouchers-schemes/economic-and-labour-market-impacts This report addresses the research questions: “What outcomes and impacts have vouchers generated for businesses?” and “Over what timeframe have these impacts emerged and persisted?” The analysis

Source Licensing

• Licensed under Open Government Licence v3.0 (https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/). Attribution: Contains public sector information licensed under the Open Government Licence v3.0..