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InfoComm Industry Study
 
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Executive Summary
Introduction
The Changing Structure of the Washington Economy
InfoComm in the Washington Area Economy, 1980-1998
InfoComm in the Future of the Washington Area Economy
Economic Impact of Unfilled InfoComm Jobs
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2005:Digital Economy
Prepared by Stephen S. Fuller, Ph.D.
Professor of Public Policy
George Mason University

The Washington metropolitan area economy has undergone significant structural change over the past thirty years. The most obvious changes have been the declining importance of the federal government as an employer and generator of new jobs and the rapid growth of the private sector, which has been responsible for generating 95 percent of all the new jobs in the metropolitan area since 1968.

Not as evident has been the growing importance of the Information and Communications (InfoComm) Industry and its evolution into the area's principal non-federal core industry. In the thirty years since 1968, when the InfoComm Industry employed an estimated 69,525 workers and accounted for 4.6 percent of the area's employment base, it has added 274,930 new workers and now employs a total of 344,455, a gain of 295 percent. As a result of this rapid job growth, the InfoComm Industry now accounts for 10.4 percent of the area's total employment base. This increasing contribution to the past growth of the Washington area employment base underscores the importance of the InfoComm Industry to the future vitality of the Washington area economy.

  • The Washington metropolitan area workforce increased by 1.7 million jobs between 1968 and 1998, a gain of 111 percent with the private sector accounting for 1.6 million of these new jobs, or 95 percent of the area's total increase.

  • The InfoComm Industry employed 69,525 workers in 1968 accounting for 4.6 percent of the area's employment base; today, the InfoComm Industry employs 344,455 workers accounting for 10.4 percent of the area's jobs.

  • The InfoComm Industry generated 274,930 new jobs over the past thirty years accounting for 16.3 percent of all new jobs in the Washington metropolitan area.

  • Job growth in the InfoComm Industry accelerated during the Eighties averaging 9.5 percent annually compared to a 3.6 percent annual gain for the area's non-InfoComm jobs.

  • Since the 1990-1991 recession, the InfoComm Industry added 66,600 new workers to its workforce directly accounting for 18.8 percent of all new jobs generated in the private sector during the last six years.

  • The InfoComm Industry is highly interdependent with the area's non-InfoComm sectors resulting in a multiplier of 2.01; that is, for each new InfoComm job more than 1 additional new non-InfoComm job will be generated elsewhere in the area economy.

  • The increase of 66,600 InfoComm workers during the 1992-1998 period supported the creation of 67,300 additional non-InfoComm jobs (private sector) in the Washington area economy; together the direct and indirect job growth supported by the InfoComm Industry accounted for almost 38 percent of all new private sector jobs created during this period.

  • InfoComm jobs, as a percentage of the area's total employment base, are two-times greater than their percentage in the national employment base (10.4% v. 5.0%) and this relative concentration has continued to increase in the Nineties.

  • The continued growth of the InfoComm Industry over the 1998-2010 period will generate 91,518 new jobs (assuming that the shortage of technology workers does not increase from its current level); this gain will support the creation of 92,532 other private sector jobs in the area economy combining to account for 24 percent of all new private sector jobs generated over this twelve-year period.

  • Projected job gains in the InfoComm Industry will account for 11.9 percent of the area's new private sector job growth and will generate $6.8 billion in real personal income accounting for 21.0 percent of the area's personal earnings growth over the forecast period.

  • The Washington area's gross regional product (GRP) generated in the private sector is projected to grow by 38.1 percent from 1998 to 2010 while total output of the InfoComm Industry is projected to increase by 52.2 percent; total output generated in the InfoComm Industry will account for 27.3 percent of the real gain in GRP over this period

  • The more rapid growth of the InfoComm Industry over the next twelve years will increase its contribution to private sector GRP to 22.0 percent by 2010.

  • The projected increase of 91,518 new jobs in the InfoComm Industry over the 1998-2010 period does not include the existing short fall of an estimated 20,000 unfilled positions; if this short fall was eliminated over the 1999-2003 period, the total increase in InfoComm jobs over the forecast period would total 111,518 and the total private sector employment base gain in the metropolitan area would increase from 702,440 to 742,660; that is, filling the 20,000 unfilled InfoComm jobs would generate a total job increase of 40,220.

  • The economic impact of eliminating the shortage of 20,000 InfoComm workers is demonstrated by the difference in accumulated earnings and output over the forecast period; with the gap closed by 2003, total personal earnings would be $17.2 billion greater and total output (GRP) would increase by an additional $20.1 billion.

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