Tag Archives: taxonomy

Investing in Idaho’s High-Tech Industry

Until recently, the high-tech industry cluster was relatively amorphous. Analysts chose industries that best suited the immediate objective – a “know it when you see it” approach, but that made it difficult to compare one analysis to any other. So in 2013 the Workforce Information Council, a federal-state organization set up under federal law, created a new, statistically robust high-tech taxonomy or classification procedure.

The taxonomy is based on the concentration of science, technology, engineering and mathematics occupations within an industry. To qualify as high-tech, an industry must have 2.5 times the national average of so-called STEM occupations. The current national average is roughly 5 percent, meaning to qualify as high-tech, an industry must have at least 15 percent of all employment classified as STEM occupations.

The most recent industry assessment under the taxonomy, released in 2014, includes 31 industries ranging from computer systems design and related services, where STEM concentration was about 67 percent nationally, to resin, synthetic rubber and artificial synthetic fibers and filaments manufacturing, where the STEM concentration was roughly 16 percent nationwide.

High tech industries and concenetraions

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Idaho Leads Research to Identify High-Tech Taxonomy

New national research, led by the Idaho Department of Labor, has evolved into a new industrial taxonomy for high technology jobs. The research, conducted for the Workforce Information Council[1], involved using data from the U.S. Census Bureau’s Quarterly Workforce Indicators  to compare states across several different metrics. Idaho’s performance was mixed.

The new high-tech industry taxonomy is based on concentrations of occupations from two subdomains of the Standard Occupation Classification Policy Committee’s STEM occupation list – life and physical science, mathematics and information and engineering and health. All four-digit NAICS industries that had over 2.5 times the national average concentration of either of these occupation groups were defined as high-tech. The two subdomains were kept separate in the analysis and led to two different high-tech industry groups – STEM Core and STEM Health Care.

table 1

Idaho did not fare well in many of the metrics for either high-tech group, but there were a few where the state stood out.

Table 2

STEM Core

Idaho made up 0.4 percent of all the STEM Core employment, ranking 38th among the states for which data were available, and not surprising considering the small population. Among the surrounding states, Washington ranked ninth at 3.4 percent, Oregon 26th at 1.2 percent and Utah 28th at 1.1 percent. Wyoming landed at the bottom of the list with only 0.2 of a percent of STEM Core employment.

For total STEM Core employment, Washington remained the highest among the surrounding states, ranking second nationally at 12.8 percent of total state employment behind Washington, D.C. Utah ranked 11th with 9.6 percent of its employment in the STEM Core industries. All other regional states fell below the average of 8.4 percent. Idaho ranked 25th at 7.4 percent.

STEM Core employment was strongly affected by the recession, causing the average employment to decline 0.3 percent between 2002 and 2002. All but two states surrounding Idaho bucked the trend and recorded employment growth in STEM Core industries. Utah led the way with a 29 percent increase in payrolls followed by Wyoming at 18.8 percent, Washington at 17.9 percent and Montana with 15.5 percent. These growth rates were some of the best among the states with available data and landed all four states in the top 10 nationally. Nevada and Idaho both lost more than the national average – Nevada dropping 5.9 percent and Idaho 6.4 percent.

Table 3

STEM Core earnings per worker varied among the states, but Washington topped the region at over $107,000, high enough to rank third nationally. All other states in the region came in below the average of $92,200. Idaho ranked 39th with earnings per worker of $71,424.

Table 4         Table 5

Idaho fared much better when comparing STEM Core earnings to average earnings for all jobs. Washington still ranked the highest, leading the nation with STEM Core earnings 205.4 percent higher than Washington’s all industry average earnings per worker. Oregon ranked fifth at 198.4 percent, and Idaho was seventh at 196.1 percent, well above the national average of 188 percent.

Idaho’s percentage of national STEM Health Care employment ranked similarly to STEM Core employment – half a percent to place 40th. Nevada had slightly more employment in these industries than Idaho. Washington still led the region at 2 percent, ranking 18th nationally.

Table 6       Table 7

In terms of relative employment, most of the states in the region ranked in the bottom 10 of the states. Montana, the only state with a higher concentration of STEM Health Care employment than the average, was barely above the average to rank 27th. Idaho follows next with 11.6 percent of its employment in STEM Health Care industries, ranking 33rd. All the other regional states rank in the bottom ten spots.

In contrast to STEM Core industry employment, STEM Health Care employment had a good decade for growth. All states with data posted increases between 2002 and 2012. Idaho did quite well with payrolls expanding 33.4 percent to rank sixth nationally. Only Utah was ahead of Idaho in the region with 35.5 percent growth. Oregon, Montana and Washington were the only regional states to be below the national average of 24.8 percent, but all ranked in the top half of states.

TAble 8

Unfortunately Idaho did not fare as well in earnings per worker. At $42,241, Idaho ranked last among states. Utah and Montana were not far ahead at 46th and 40th. Nevada, which did not rank well on many metrics, topped the region in earnings per worker for STEM Health Care at $57,358 to rank third nationally. Washington and Oregon joined Nevada in the top 10 nationally, the only states in the region above the average.

Table 9

Idaho improved substantially when looking at relative earnings per worker. At 116 percent, Idaho ranked 14th overall. Nevada, Montana and Oregon all came in above Idaho to land in the top 10. While all states in the region come in above the average of 104.6 percent, this high-tech group pays notably less than STEM Core industries.

Table 10

For a full list of how all the states ranked plus a detailed look at the methodology used and how the nation overall has fared see “The High-Tech Industrial and Occupational Cluster: National and State Comparisons” posted on the Workforce Information Council’s website http://www.workforceinfocouncil.org/#fifth

Andrew.Townsend@labor.idaho.gov, regional economist
(208) 332-3570, ext. 3455

 [1] http://www.workforceinfocouncil.org/Documents/HIgh%20Tech%20Suite%20reduced.pdf