Instead of uniting us, the digital world divides us. That’s the finding of a new study released by the Economic Research and Data division of the Federal Reserve Bank of San Francisco.

Instead of uniting us, the digital world divides us. That’s the finding of a new study released by the Economic Research and Data division of the Federal Reserve Bank of San Francisco.

The research found that computer usage has important implications for material well-being and that productivity gains in the United States in the 1990s can be partially tied to the explosion of computer technology in the workplace. The findings show education is the biggest determinant of computer usage, followed by income level and racial/ethnic group.

Understanding this trend is key for the real estate industry because minorities and immigrants represent the biggest source of new home buyers. Increasingly, home buyers depend on such technology as listings on the Internet to find and buy homes.

So what does that say about those without access or skills to use computer technology?

The federal government in September 2001 released the Computer and Internet Use Supplement as part of its monthly Current Population Survey and surveyed about 60,000 households on their employment status. After asking more than 116,000 individuals about computer use at home, work and school, the study found, not surprisingly, that computer usage is widespread and continues to grow. More than 67 percent used computers through one or more of those sources, up from 43 percent in 1989. In the current survey, nearly 55 percent of people use computers at home and nearly 55 percent use computers at work. Almost 85 percent of children use computers in school.

Yet despite widespread distribution of the technology, computer usage does not cross all social and economic levels equally.

The research found that computer literacy varies widely across educational levels, family incomes and racial backgrounds. Education is the key determinant of computer use at home, fluctuating from 19 percent for those with no high school degree to 82 percent for those with graduate degrees. Even after considering family income and computer use in work and school, the educational gap continues to separate users and nonusers.

Perhaps most surprisingly, geographical location has only minimal impact on computer and Internet usage. The report examined states in the 12th District, which includes California and Washington, two states considered at the forefront of the information technology revolution. Those states show equal or lower rates of computer use than the remainder of the United States.

The major technology centers within these states, which include the San Francisco Bay Area and Seattle, had higher levels of Internet usage. However, the usage gaps essentially close after education levels, income and ethnic groups are considered.

So is there a digital divide?

“Yes and no,” the authors of the report concluded.

In geographic terms, there is minimal evidence of a digital divide between states in the 12th District and the rest of the country after accounting for education, family income and industrial factors.

But the digital divide grows when considering education, income and race/ethnic groups.

“College education is the key determinant of computer use, although substantial gaps are evident across income categories and, to a lesser extent, racial/ethnic groups as well,” said Rob Valetta, economist and co-author of the report.


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