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Once Again: High Tech Jobs Are Important, Growing And Everywhere

from the so-maybe-don't-try-to-muck-it-up dept

A few months ago, we wrote about a presentation from the Bay Area Economic Council, in association with Engine (I'm on their steering committee, but had nothing to do with this), showing that high tech jobs were a high point in the economy. Unlike many other sectors, those jobs were growing -- and contrary to what many believed, they weren't just concentrated in one area, but were spread out across the US. Furthermore, their economic contribution tended to be significant. Basically: the tech industry is increasingly important to our economy, and policy makers should be careful not to muck that up. This week, the Bay Area Council Economic Institute, commissioned by Engine, put out the full report on this, entitled Technology Works: High Tech Employment and Wages in the US (pdf). Once again, it highlights the importance and success of the tech industry. A few high level points:
  • Since the dot-com bust reached bottom in early 2004, employment growth in the high-tech sector has outpaced growth in the private sector as a whole by a ratio of three-to-one. High-tech sector employment has also been more resilient in the recent recession-and-recovery period and in the last year. The unemployment rate for the high-tech sector workforce has consistently been far below the rate for the nation as a whole, and recent wage growth has been stronger.
  • Employment growth in STEM occupations has consistently been robust throughout the last decade, outpacing job gains across all occupations by a ratio of 27 to 1 between 2002 and 2011. When combined with very low unemployment and strong wage growth, this reflects the high demand for workers in these fields.
  • Employment projections indicate that demand for high-tech workers will be stronger than for workers outside of high-tech at least through 2020. Employment in high-tech industries is projected to grow 16.2 percent between 2011 and 2020 and employment in STEM occupations is expected to increase by 13.9 percent. Employment growth for the nation as a whole is expected to be 13.3 percent during the same period.
  • Workers in high-tech industries and STEM occupations earn a substantial wage premium of between 17 and 27 percent relative to workers in other fields, even after adjusting for factors outside of industry or occupation that affect wages (such as educational attainment, citizenship status, age, ethnicity and geography, among others).
  • The growing income generated by the high-tech sector and the strong employment growth that supports it are important contributors to regional economic development. This is illustrated by the local multiplier, which estimates that the creation of one job in the high-tech sector of a region is associated with the creation of 4.3 additional jobs in the local goods and services economy of the same region in the long run. That is more than three times the local multiplier for manufacturing, which at 1.4, is still quite high.
These are all important points, but the biggest one may be that tech work encompasses so much these days. It's not just "Silicon Valley" at all, but all kinds of jobs for all kinds of companies. Tech isn't an industry. It's not just a job function. It's a part of nearly every aspect of our economy.. It makes other parts of the economy more efficient and increases opportunity in many different areas. And because of that, "tech" jobs are growing all over the place. When I see that (as the report notes) places like Boise Idaho, Augusta, Georgia and Peoria Illinois are seeing the greatest amount of high tech job growth, that's a really good sign. We run into problems when all you have is a "company town" where an entire industry is based out of one place. This isn't about "the tech industry" but the fact that every single industry is a tech industry, and tech jobs are everywhere -- and, given their economic impact, incredibly important.


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  1.  
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    cosmicrat (profile), Dec 6th, 2012 @ 11:22pm

    Kind of like the production industry

    "We run into problems when all you have is a "company town" where an entire industry is based out of one place. This isn't about "the tech industry" but the fact that every single industry is a tech industry, and tech jobs are everywhere -- and, given their economic impact, incredibly important."

    Okay I realize I'm reaching a little here, but this is eerily reminiscent of some things I've been trying to tell you about the production industry (what you derisively call "Hollywood"). Yes, this industry was once based in it's eponymous town (along with New York), but has spread out (due in large part to film incentive programs). And "every single industry is a tech industry" (?) Are you taking a talking point from Chris Dodd? ("Every popcorn grower in Iowa, every supermarket bagger is employed by an IP intensive industry")

     

    reply to this | link to this | view in thread ]

  2.  
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    Suzanne Lainson (profile), Dec 6th, 2012 @ 11:52pm

    It's more than just high tech policy though

    Basically: the tech industry is increasingly important to our economy, and policy makers should be careful not to muck that up.

    I live in Boulder, which is number two on the list of tech worker concentration (right behind San Jose-Sunnyvale-Santa Clara).

    Voters here care about a lot of issues, and it's a reliably Democratic district. The environment, sustainability, education, gay rights, women's rights, and healthy living are fairly popular causes here. We have voters here who are very vocal about anti-fracking, anti-GMOs, wanting the city to run its own power company so it can support more renewable energy, and so on. We also have a lot of government research money coming into Boulder, so I doubt you'll find much support to end that.

    Politicians who think all they have to do is be pro-high tech without addressing other areas of interest to these voters probably won't do as well as those who support high tech industries AND other issues.

     

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  3.  
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    Suzanne Lainson (profile), Dec 7th, 2012 @ 12:14am

    Re: It's more than just high tech policy though

    Sounds like Silicon Valley also has issues that go beyond business policy.

    The Republican Postmodern Turn, Silicon Valley, and California’s Political Transformation � Cultural Geography � GeoCurrents: "Silicon Valley leaders are by no means perfectly satisfied with the economic policies of the current administration, and one hears grumbling from the rank-and-file as well. A more business-friendly orientation would be welcome, as would immigration reform that would open the door to affluent newcomers with technical talents. But a large array of Republican policies and attitudes has made the party unpalatable to most Santa Clara residents. While gay rights and abortion matter, so does science. In the high-tech world, unwavering support for the scientific approach is axiomatic. Those who regard climate change as a conspiracy, or who advocate teaching creationism in the public schools, find little support here. Yet over the past two election cycles, such anti-science viewpoints seem to have captured the core constituency of the Republican Party."

     

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  4.  
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    ECA (profile), Dec 7th, 2012 @ 12:37am

    DEFINE

    Please define: HIGH TECH

     

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  5.  
    identicon
    Anonymous Coward, Dec 7th, 2012 @ 4:10am

    Re: DEFINE

    Depend on whom you ask.

    If you ask the USPTO, it's anything that is done "on the Internet".

     

    reply to this | link to this | view in thread ]

  6.  
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    Andres Fortino, Dec 7th, 2012 @ 4:23am

    No surprise that technology is pervasive

    Great post. And thanks for the reference to a needed report. But it came as no surprise since our friend Brian Arthur has been telling us of the pervasiveness of technology and it's strong relationship to the economy in his great book: "The Nature of Technology". Worthwhile reading.

    Andres

     

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  7.  
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    varagix, Dec 7th, 2012 @ 5:13am

    Re: Kind of like the production industry

    I agree. I think it would be more accurate to say that most industries directly employ workers in the high tech sector. Just about every large business requires a tech person on staff for troubleshooting and maintenance of computers and electronic equipment. Quite a few use and maintain custom programming solutions.

    While most businesses only tangentially or indirectly use IP and most neither use nor create content in their line of work, just about everyone directly makes use of computers and technology on a daily basis.

     

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  8.  
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    Lurk-a-lot (profile), Dec 7th, 2012 @ 5:15am

    Re: DEFINE

    From the report:
    The high-tech sector is defined here as the group of industries with very high shares of technology oriented
    workers—those in the STEM fields of science, technology, engineering and math. This definition includes a
    set of industries in what is traditionally thought of as high-tech—manufacturing and services in computers,
    advanced communications and electronics—as well as the medical and aerospace manufacturing,
    engineering services, and scientific research and development industries (see Appendix 1).

     

    reply to this | link to this | view in thread ]

  9.  
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    out_of_the_blue, Dec 7th, 2012 @ 12:09pm

    73% of New Jobs Created in Last 5 Months Are in Government

    You never have to wait long for Mike's notion to be shown wrong.

    http://cnsnews.com/news/article/73-new-jobs-created-last-5-months-are-government

     

    reply to this | link to this | view in thread ]

  10.  
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    John Fenderson (profile), Dec 7th, 2012 @ 2:22pm

    Re: 73% of New Jobs Created in Last 5 Months Are in Government

    So? How does this shown anything is wrong?

     

    reply to this | link to this | view in thread ]

  11.  
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    Anonymous Coward, Dec 8th, 2012 @ 4:18am

    Re: Re: 73% of New Jobs Created in Last 5 Months Are in Government

    Because everyone knows that there are no STEM government jobs. Just look at NASA: full of arts majors

    /s

     

    reply to this | link to this | view in thread ]


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