CHARLOTTE – Technology is becoming ever more important to North Carolina’s economy even though the full impact of the COVID-19 pandemic has yet to be factored in to traditional economic measurements.
So said Ted Abernathy, managing partner of Economic Leadership LLC, in presenting findings of 7th annual North Carolina State of Technology Industry Report at Wednesday’s Outlook for Tech Conference put on by the NC Technology Association.
“Technology is growing faster than the whole of the economy,” said Abernathy, noting that beyond the technology industry, more and more jobs are considered tech occupations, even outside of the technology industry.
Figures for 2019 show the tech sector was responsible for 20% of the state’s economy. But relfecting higher pay in IT, the tech jobs were responsible for 24% of payroll. That percentage is up from 17.5% in 2013.
Total tech occupations in the state are approximately 332,000 but only 37% of these jobs are considered to be in the technology industry.
“Technology jobs are permeating every industry,” said Abernathy. “More tech jobs in finance, in retail, in government services.”
And a new survey indicates companies are going to need more tech workers in the future. In a survey of CEOS, 82% said they expected to need more technology, 97% said remote work will remain at an “increased” level and 17% said they expect to “onshore” jobcs back to the US. Also competition for workers will be intense with 37% of execs predicting tighter job markets.
But there’s a downside to tech, too: 16% execs expect to reduce workers by utilizing artificial intelligence.
Jobs in IT remain at elevated levels despite the pandemic
Demand for talent is very strong in the Raleigh-Cary area even as openings across the state dipped slightly in December.. And big tech is hiring. IBM, Oracle and Cisco are leading the demand for new talent, but many other firms of all sizes are beefing up tech staffs.
Open jobs in the capital city area surged nearly 16% year-over-year to 9,490, according to the IT Job Trends report for December. That total led the state for the second straight month with Charlotte second and Durham-Chapel Hill third, according to NC TECH data.
But hanging over the report’s findings is COVID.
“When we do this study every year, we are trying to understand the strengths and weaknesses of North Carolina,” Abernathy explained.
Importantly, since somethe data in this report predates the COVID-19 pandemic, the report may best be thought of as a baseline measure of where the economy was before the pandemic.
“While it is very likely the tech industry experienced some changes in 2020, this report will help provide a baseline of the tech industry pre-pandemic,” reads the digital version of the report. “This data can act as a benchmark to measure the return of the economy.”
In that context, the report does outline the macroeconomic trends as it relates to employment levels in the state of North Carolina throughout 2020, including a historic low of 3.6 percent in February, reaching a high of 12.9 percent, then falling by October to 6.3 percent.
When it comes to jobs in North Carolina, the report found that the tech industryis spreading and accounts for more than 6% of all jobs in many counties across the state, including Macon, Transylvania, McDowell, Caldwell, Franklin, and New Hanover. Mecklenburg, Wake, and Durham counties sill account for nearly 57% of the entire technology industry.
Specific to the technology industry, the report finds that it is a major driver of economic activity in North Carolina, adding a total of 41,260 jobs.
Tech growth is anticipated to continue, Abernathy added, though he also noted that predictions aren’t facts, and the trends will need to be monitored closely, especially due to the COVID-19 pandemic.
“When we look forward over the next five years, North Carolina is projected to have real strong tech employment growth,” said Abernathy, with the demand for software developers, business operations specialists, computer systems analysts, and computer user support specialists projected to drive the growth of tech sector occupations.
The growth of the technology sector, and the expansion of technology occupations within other sectors, also drives economic impact in North Carolina, said Abernathy. The report concludes that the technology industry is directly responsible for more than $30 billion in earnings and more than $96 billion in sales. Furthermore, because three technology industry jobs support another seven jobs elsewhere in the state’s economy, the total impact is much higher when including the indirect and induced economic impact data. The report finds that the total impact of North Carolina’s technology industry is nearly $62 million in earnings and nearly $190 million in sales.
Growing prominence nationally
North Carolina’s tech sector also is drawing more attention nationally.
Three regions of North Carolina ranked in the Top 20 best regions for technology in the country as found by tech business group CompTIA: Raleigh, Charlotte, and Durham-Chapel Hill.
And, North Carolina ranks among the top 15 states when it comes to the percentage of women working within the technology industry (at No. 2, with women representing 35.4 percent of the tech industry workforce), median annual earnings (adjusted for purchasing power), STEM education programs per 1,000 students, total R&D as percentage of GSP, and expected tech occupations growth, among a long list of other notable top-15 rankings found in the Key Findings of the report.
One notable finding is the measure of tech transfer as estimated by the number of startup firms at universities within the state, which can also be an indicator of trends involving interest in entrepreneurship, found the report. North Carolina ranks as the No. 6 state with 47 new companies that successfully spun out of the state’s universities during the period the report covers.
Programs like UNC-Charlotte’s Ventureprise continue to cultivate interest in entrepreneurship and technology transfer, and are receiving notable awards, like last week’s announcement that Ventureprise won a “Visionary” prize of $25,000 in the Lab-to-Market (L2M) Inclusive Innovation Ecosystem Prize Competition. This proposal focused on Ventureprise’s “Build-Measure-Learn” pilot programs that seek to engage women and underrepresented minorities in the innovation process, said Devin Collins, the interim executive director of Ventureprise.
“The findings indicate that the Tech Industry in North Carolina is growing at a fast pace with an employment growth rate of 18% from 2014-2019,” reads the report. “There are trends that are locking in,” he added, such as:
- Concentration of R&D funding
- Increasing share of venture capital money flowing into North Carolina
- North Carolina’s strength in the life sciences.