Tech industry group highlights positive role in US economy
The US tech industry is key to the economies of all 50 states, claims a report released by the Information Technology Industry Council (ITI). It's a counter to the negative publicity over allegations of antitrust behavior by Facebook, Amazon, Apple, and Google.
The report: Powering Innovation, Driving Growth: The High-Tech Economy in Communities Across America -- argues that the high-tech industry is no longer restricted to a handful of high-tech hubs such as San Francisco/Silicon Valley but now makes a solid contribution to the economies in all 50 states.
"The coronavirus pandemic has highlighted the indispensable role that technology and the technology sector play in our lives —and, importantly, this research makes clear that technological innovation is woven through the entire U.S. economy," said ITI President and CEO Jason Oxman.
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The ITI represents giant and small tech companies. However, the antitrust regulatory attention received by the four largest tech companies has split the membership. Politico reported last year that ITI members had asked the trade organization, "to not get in the middle of someone else's antitrust debate."
The report paints a positive picture for the US high-tech sector and its continued role in driving the economy. Some of the findings:
- High-tech fuels local economies of most congressional districts, producing an average of 29% of manufacturing exports.
- Over one-half of congressional districts received at least $50 million in federal R&D funding over a two year period.
- Alabama has the highest share - 16% of its high-tech workforce working for startups.
- Texas and Florida host almost four times more startups than the U.S. average.
- Each congressional district averages over 400 startups -- equivalent to about 3.400 jobs.
- High tech workers earn an average of $79k in the median state -- twice the national average.
- Productivity of tech workers is very high with the average congressional district generating almost one-third of manufacturing exports from under 10% of its workforce.
The report tracks 23 economic indicators and analyzes 435 congressional districts.
Many ITI members are concerned that government regulators aiming to curb the power of the tech giants might harm their business. The report seeks to stress the many positive benefits of a strong high-tech industry.
"Every state and congressional district has a stake in continuing to strengthen the foundations of the innovation-driven, high-tech economy. It is the surest way to boost U.S. competitiveness and create good jobs," said Oxman.
The report comes just a few days after the CEOs of Facebook, Apple, Amazon and Google were questioned for more than five hours by members of the House Judiciary Subcommittee on Antitrust.
Mark Zuckerberg, CEO of Facebook, last year asked congress for new regulations. However, the costs of complying with any government regulations is easier for Facebook and a burden for smaller companies. The higher costs limit entry from startup competitors.
Tech industry regulations could potentially backfire if higher costs of operations limit the entry of startups and end up protecting the dominant players -- the giant platforms accused of antitrust practices that harm smaller businesses. The US telcos are a good example of a regulated industry, with no new competitors and high prices.