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.