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Job Losses in Tech Sector Decline in 2010

October 6, 2011

TechAmerica Foundation released its 14th annual Cyberstates report detailing national and state trends in high-tech employment, wages, and other key economic factors.

Cyberstates 2011: The Definitive State-by-State Analysis of the U.S. High-Tech Industry covers all 50 states, the District of Columbia, and Puerto Rico.

The U.S. high-tech industry lost 115,800 net jobs in 2010, for a total of 5.75 million workers. This two percent decline in the techmology industry employment was less than half of the 249,500 jobs lost in 2009, which followed several years of sustained growth. Over the longer term of 2007 to 2010 – the span of the economic downturn – the tech industry fared better than the private sector as a whole, with a four percent decline in employment versus a seven percent decline in the private sector.

“Of the four high-tech sectors highlighted in our report, only software services added jobs in 2010 – 22,800, a one percent gain,” said Robert Bennett, chairman of TechAmerica Foundation. “Of the jobs lost, 72,100 were in communications services, 53,600 were in tech manufacturing, and 12,900 were in engineering and tech services. Fortunately, the initial numbers for 2011 look more promising in terms of job growth.”

TechAmerica Foundation also released a midyear jobs report for 2011 based on a different monthly data set from the U.S. Bureau of Labor Statistics. This report shows that between January and June 2011, the technology industry added a net 115,000 jobs, a two percent gain, not adjusted for seasonality.

During this time period, job growth occurred in all four technology industry sectors, with the fastest growth in engineering and tech services. A 12 month review of June 2010 in comparison with June 2011 also shows growth in three of the four tech industry sectors, with job losses occurring in communication services.

“Tech jobs were down in 2010, trending with the rest of the economy, but we have fared better than the private sector as a whole over the course of the economic downturn and there are some positive signs for 2011, said Phillip Bond, president and CEO of TechAmerica. “We are poised not only to grow our own industry but to support the growth of the economy as a whole. The key to growth is to support what we call the Four T’s: technology, talent, tax, and trade.”

The state-by-state data reveal that only eight states added technology jobs in 2010. The largest gains occurred in Michigan (+2,700), the District of Columbia (+1,400), West Virginia (+400), Utah (+400), and South Carolina (+300). On a percentage basis, the District of Columbia saw the fastest job growth in 2010 at 4.3 percent, albeit at a small base.

For the sixth straight year, Virginia led the nation with the highest concentration of technology workers – 98 of every 1,000 private sector workers in the state were employed in the technology industry. Massachusetts and Colorado ranked second and third, respectively.

Cyberstates 2011 relies on data from the U.S. Bureau of Labor Statistics. The report provides 2010 national and state data on high-tech employment, wages, establishments, payroll, wage differential, and employment concentration. All data are the most recent available at the time of publication.

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