The Economics of IT
Three Perspectives on IT Economics Today’s Topics 1) Economic Composition 2) Industry Composition 3) Labor Supply
Economic Composition What kind of work do we do?
Staffing Patterns for IT Share of IT Employment in Idaho Source: Idaho Department of Labor
Industry Growth Projections Projected Growth: 2014 – 2024 Source: Idaho Department of Labor
Idaho’s Technology Gap STEM Industry Size and Growth in every State – Shares Washington Idaho Source: US Bureau of Labor Statistics
Idaho’s Technology Gap Growth in Computer and Mathematics Occupations Source: Idaho Department of Labor
Industry Composition How do we work?
Public Enemy Number One The Stocking Frame Knitting Machine
The Pattern of Modern Automation Where are we? Agriculture Industrial Clerical Services
Staffing Patterns for IT Share of IT Employment in Idaho +181% -28% Source: US Bureau of Labor Statistics & Federal Reserve Bank of St. Louis
The Automation Paradox Some Headlines • Why Are There Still So Many Jobs? (David Autor, PhD – Journal of Economic Perspectives) • Robots Aren’t Destroying Enough Jobs. Greg Ip, Wall Street Journal • False Alarmism: Technological Disruption and the U.S. Labor Market. John Wu, PhD – Information Technology and Innovation Foundation
The Automation Paradox The Verbal Model Significant Labor Glut! Displaced Workers Automation in a Reduced price of must seek work in small subset of labor in low skill new industries Industries industries Cheap labor Cheap labor Overall reduces financial reduces financial Productivity incentives to incentives to Growth remains automate automate muted
The Automation Paradox The Verbal Model Significant Labor Glut! Displaced Workers Automation in a Reduced price of must seek work in small subset of labor in low skill new industries Industries industries Cheap labor Cheap labor Overall reduces financial reduces financial Productivity incentives to incentives to Growth remains automate automate muted
Automation Risk in Idaho Distribution of Automation Probability Percent of 2024 Projected Total Employment in Idaho Low Medium High 29.2% 14.7% 46.5% Sources: Frey & Osborne, Oxford Martin School, 2013; U.S. Bureau of Labor Statistics: 2010 Occupational Employment, Idaho Department of Labor, 2016
Healthcare’s Regulatory Bubble Idaho Employment in Healthcare Practice and Support Source: Idaho Department of Labor
Labor Supply Where are we going to get all these brogrammers?
Limited Graduate Supply Idaho Computer Science Graduates per Year Annual Openings 525 per Year Source: Idaho Department of Labor, IPEDS
Educational Output Growth in Computer Science Degree Completers Source: Idaho Department of Labor
Educational Output Idaho’s Share of Regional Completers Source: IPEDS
Idaho’s Technology Gap STEM Industry Size and Growth in every State – Shares Washington UT Idaho OR Source: US Bureau of Labor Statistics
Employment Projections 2014-2024 North Idaho Projections 2014 2024 Total Growth Annual Occupation Title Employment Projection Growth Rate Openings Software and Systems Developers 423 628 205 48% 260 Network Administrators 147 197 50 34% 17 Network Specialists 237 320 83 35% 11 Web Developers 86 137 51 59% 6 Total 893 1282 389 43% 294 Source: Idaho Department of Labor
Conclusions Today’s Topics 1) IT-Intensive Industries are projected to be high-growth 2) Economic and Political factors will likely cause new industries to experience their own IT renaissances 3) Idaho’s STEM labor supply presents a continued barrier to growth Sam Wolkenhauer Regional Economist Idaho Department of Labor Sam.Wolkenhauer@Labor.Idaho.Gov
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