Oregon Office of Economic Analysis

Recently the Austin Technology Council released a new report on tech talent (Edit 2017: link broken.) It focuses on the sector’s expected strong growth, a potentially emerging skills gap* between what employers say they need and the skills potential job candidates have, and also whether the supply of such workers can keep up with demand. The report is filled with good nuggets of information, including this chunk from the intro, which many folks across the country say is true, all you need to do is change the city name.

While tax incentives and ribbon cuttings tend to dominate headlines about economic development, it’s availability of skilled labor that usually drives corporate location decisions, especially for tech companies relying on highly skilled workers to drive innovation and market share. Austin’s strong economic growth and renowned quality of life are attracting people from around the U.S. and the world. But the future of Austin’s tech industry also depends on the region’s ability to prepare local residents for high-skill, high-demand job opportunities.

While the report benchmarks Austin to other major tech metros, that list did not include Portland. To that end, I went and examined the core 19 tech occupations, as listed in the report — computer systems analysts, software developers, programmers, etc — for the ten metros included in the report in addition to Portland and the U.S. overall. The results are shown below. Total tech employment, which includes office and sales staff for example, is obviously larger than this, but the following represents those core, fundamental occupations and skill sets. In short, Portland’s share of all jobs in tech occupations is both significantly above the national average but also significantly below the most tech-heavy metros.

The group above includes some of America’s largest and most productive metropolitan areas, so it is no surprise to find that these metros are home to 1 out of every 8 U.S. jobs (12.5%.) What is somewhat surprising is the degree to which tech clusters. These same 11 metros are home to 1 out of every 4 U.S. tech jobs (25%.) That’s quite an amazing statistic.

It’s important to keep in mind, as the ATC report notes, that not all of these jobs are truly tech jobs. In Austin, about 1/3 of these are in non-tech industries (universities, government, R&D, etc). Even so, the labor/talent pool from which employers draw is the same. Tech firms must compete with non-tech firms for the same type of workers and skills. Even if your region is not tech-heavy, having a large number of such skilled workers in non-tech industries is still a boon for economic growth and innovation moving forward.

While Portland may rank a notch below the best known and largest tech hubs in the country, it is just a notch and not a giant step down. Across the 50 largest MSAs in the country, Portland’s tech concentration ranks 14th highest. The full rankings and shares are shown below. Note: Durham-Chapel Hill drops off the list.

These findings are similar to our office’s previous work examining high-tech across states, where Oregon ranked 14th highest, a step above the national average. A few key points from our previous work:

However it is important to think about what types of technology we actually have here in Oregon, compared with what other sub-sectors are concentrated more heavily in other locations. For example, we know that Oregon has a higher concentration of manufacturing high-technology with the presence of Tektronix (more historically) and Intel (more recently), and the like.

Even though Oregon does well directly on software, in this broader context of software that includes most of the other non-manufacturing sub-sectors, Oregon ranks 27th highest and below the U.S. average. On the hardware side, Oregon ranks above average and 7th highest among all states. Since the fallout of the 2001 recession, Oregon’s relative position in high-tech is largely unchanged year to year. If one dives a little deeper into the data, Oregon does rank 1st for semiconductors.

The strong growth in recent years, both nationally and here in Oregon, is dominated by the software side of the industry. Hardware is largely holding steady, but not likely to grow employment significantly in the future.

The table below details each of the 19 core occupations across the first set of major metro areas and the U.S. in terms of 2014 employment.

For additional Oregon information, see Employment’s report on high-tech from earlier this year, researched and written by Jill Cuyler-Cook.

*I am much more sanguine about the so-called skills gap overall, although specific industries and occupations are more prone than others, including tech. See the Computer/Math occupations, e.g.