Google’s search and advertising tools helped generate $80 billion for American businesses in 2011

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By Ricardo Bilton

Google may be worth upwards of $200 billion by itself, but the company is also helping to generate some serious revenue for everyone else. So says the company’s latest Economic Impact Report, which estimates that Google’s search and advertising tools helped generate $80 billion for American businesses in 2011.

Google draws its revenue figures by combining AdWords revenue, payout to AdSense partners, and donations made to non-profit organizations through Google Grants.

The numbers are based on two assumptions: Google assumes that, for every two dollars a business spends on AdWords, one dollar is made back. The company also assumes that businesses net five times as many clicks on their search results as they get on advertisements

Google illustrated these numbers via its Economic Impact tool, which lists how much cash the company helped generate for each state. The biggest winner is California, which generated $20 billion through Google. That the state came out on top is no big surprise, as it’s where Google is based. New York came in second with $11 billion.

Google’s numbers have been increasing at a fairly regular clip since the company began releasing the data two years ago: The company says it helped generate $54 billion in 2009 and $64 billion in 2010.

Even Google was slightly taken aback by the news. “What’s really surprising here is that, even in a bad economy, businesses are still growing,” Google Policy spokesperson Jenna Wandres told VentureBeat.

And if you think the numbers sound a bit low, Google’s right with you. Not only did the company err on the conservative side with its estimates, but it also didn’t include results from products like YouTube and Google Maps. The numbers also don’t reflect the money-saving benefits of search results for consumers or how much Google’s own hiring helps the economy (Google employs over 14,000 Californians, for example).

The company does aim to include all of these details in future reports, though, so we can expect some further increases next year.

That growth will also come as more businesses flock to the Internet, Wandres said. ”It’s really significant that fifty eight percent of American businesses aren’t online, so I think that as these numbers continue to grow, more and more businesses will see the economic value of going online,” she said. –  Photo and Story Courtesy of washingtonpost