Cybercrime Costs U.S Economy $100 Billion and 500,000 Jobs

By Kenneth Corbin, CIO |  IT Management

Attacks on businesses and consumers are a blight on the economy, with criminals foreign and domestic using the Internet to steal identities, intellectual property, trade secrets and just about anything else they can get their hands on.

[Related: Economic Impact of Cyber Espionage and IP Theft Hits U.S. Businesses Hard]

A new economic model developed at a prominent D.C. think tank puts the cost to the U.S. economy as high as $100 billion annually, with a corresponding loss of as many as half a million jobs.

[Related: Obama's Cybersecurity Mandate Hits First Milestone]

The report, released by the Center for Strategic and International Studies (CSIS) and written by James Lewis and Stewart Baker, two old hands in the Washington cybersecurity policy discussion, offers a quantitative approach based on data from the Commerce Department and analogous losses from activities such as car crashes, piracy and other losses and crimes.

Cybercrime: The Cost of Doing Business?

The authors explain: "One way to think about the costs of malicious cyber activity is that people bear the cost of car crashes as a tradeoff for the convenience of automobiles; similarly they may bear the cost of cybercrime and espionage as a tradeoff for the benefits to business of information technology."

[Related: Obama Signs Cybersecurity Order]

But what is the price of all that nefarious activity?

The report, sponsored by security software vendor McAfee, eschews survey data, which the authors say is flawed because respondents "self-select," and businesses often either conceal or do not realize the full extent of the losses from a cyber attack.

"We believe the CSIS report is the first to use actual economic modeling to build out the figures for the losses attributable to malicious cyber activity," Mike Fey, executive vice president and CTO at McAfee, said in a statement.

"As policymakers, business leaders and others struggle to get their arms around why cybersecurity matters, they need solid information on which to base their actions."

Lawmakers Divided Over Government's Role

Originally published on CIO |  Click here to read the original story.
Join us:






Answers - Powered by ITworld

ITworld Answers helps you solve problems and share expertise. Ask a question or take a crack at answering the new questions below.

Ask a Question