By Kathy Henrich
Data always has a purpose. It helps measure our past, understand the effect of unexpected forces, and set direction for the future. Measuring the impact of technology in 2020 was especially important, especially in light of the headwinds of a global pandemic.
One of the key measures of tech in a state or region is CompTIA’s annual CyberStates report, which was recently released. Cyberstates measures net tech jobs including tech occupations (50 job codes) and tech industry (50 industry codes).
According to the 2021 report, the pandemic had an effect in 2020. U.S. net tech jobs grew slower than in prior years (.5 percent in 2020 versus 2.6 percent in 2019). And while the tech industry grew, the number of tech occupations declined by 1 percent. This is not surprising as many tech occupations are embedded in traditional industries like hospitality, transportation, retail and more that were heavily affected by the pandemic. In addition, some subsegments of the tech industry grew while others declined. For example, software increased 5.5 percent while manufacturing declined .1 percent).
These trends also played out in Wisconsin, where net tech employment decreased by .9 percent in 2020. This was largely due to the high degree of tech jobs embedded into other industry clusters and the composition of our tech industry. In Wisconsin, 30 percent of our tech industry is in tech services, which predominantly serve those same industries which were affected by the pandemic.
This points to the critical nature of the tech industry in addition to tech jobs.
- Nationally, the tech industry held up well in the pandemic, with only finance and insurance faring better.
- The tech industry helps the overall economy with every job in tech creating 4.8 jobs in other industries.
- The tech industry is expected to be the third-fastest growing industry segment, after only healthcare and professional/technical and scientific surveys.
Doing a comparative analysis to six other Midwest states, the trends were very similar. One Midwest bright spot was Missouri, with a strong and growing tech sector including manufacturing and software.
There were bright spots in the analysis for Wisconsin. The first is the number of tech companies grew by 387. We continue to grow our use of emerging technologies, with job postings requiring advanced technologies increasing by 15 percent. Software development also grew 12.5 percent, almost two times the national average.
As we look to the future, some of the areas of focus should include a focus on continuing to accelerate our startup ecosystem, our use of advanced technology, and increasing the diversity of our tech workforce. In all categories, we are lower than most Midwest states, yet all three are harbingers of long-term economic success.
The only Wisconsin city contained in the Cyberstates analysis was Milwaukee, where net tech jobs declined 1.8 percent. When augmented with data for the full M7 region to Kenosha and Racine, which saw growth, that decline is lowered to .6 percent.
The trends in Milwaukee are very similar to overall state trends, including the largest tech employee base being embedded in traditional industries, which saw decline. There were also similar bright spots in the growth of tech companies and the use of emerging technology. Milwaukee also had a higher concentration of women in tech (28 percent of the tech workforce) than most metros, but also has work to do to increase the racial diversity of the workforce.
Report cards are always an opportunity for reflection and growth. As we reflect on 2020, areas of growth for Wisconsin and Milwaukee include the need to grow the tech startup ecosystem, to increase our use of emerging technologies, and to increase the diversity of our workforce.
Henrich is CEO of the Milwaukee Tech Hub Coalition, which represents nearly 70 organizations focused on inclusively doubling tech talent in Milwaukee.