Utah’s Tech Boom Brings Opportunities and Challenges
According to the recent Cyberstates 2018 report put out by CompTIA, Utah is ranked as the fastest growing tech state in terms of the percentage increase in tech jobs in 2017. There are many other areas of the report where Utah performed strongly and poorly, but things are on an overall upward trajectory.
“We’ve witnessed the growth in the tech business in Utah firsthand and seen it really explode ever since the Great Recession,” said John David King, CEO of Fishbowl, an inventory management software company that has been headquartered in Utah Valley since 2001. “There’s no doubt in my mind that good things are on the horizon for tech companies in Utah as long as they keep making smart decisions like they have been.”
Here are some of the highlights of the report, which show both the opportunities and challenges Utah’s tech industry faces:
- Utah had the fastest growing percentage increase in tech jobs year over year in 2017 compared to every other state in the U.S. It narrowly beat out Michigan and North Carolina for that spot.
- 8.6 percent of workers in Utah are in the tech industry, which is the 10th highest concentration of such workers in the country. The national average is 7.2 percent, so Utah is ahead of the curve.
- Utah’s 6,531 tech companies added 4,680 new jobs and they employed a total of 135,500 employees in 2017. In addition, Utah has been slowly increasing its rank among the states by its tech industry employment. From 2014 to 2017 it went from number 24 to number 22.
- There were 26,020 job postings by Utah tech companies in 2017.
- The number of tech companies with payrolls in Utah increased 0.8 percent, which may not seem like much, but that figure puts it in the top 20 and ties it with a number of other important states, including Texas, Washington, Pennsylvania, Indiana, and Idaho. In fact, the total number of new tech companies in Utah (53) also put it in the top 20 nationwide.
- The tech industry made up 10.2 percent of Utah’s Gross State Product ($14.9 billion out of $146.2 billion). This earned the state a number 9 spot in the country for the tech GSP as a percentage of the total GSP.
- While Utah is the fastest growing state in terms of its number of tech jobs, its rate of growth slowed from 5.0 percent in 2016 to 3.6 percent. It has fluctuated between those two rates since at least 2012, though.
- Utah did not come close to cracking the top 10 states by the total number of tech jobs. It came in at number 26, so right in the middle compared to every other state and the District of Columbia. However, this shouldn’t come as a big surprise because Utah has a much smaller number of residents than the states on that top 10 list, such as California, Texas, New York, Florida, and Massachusetts.
- The average tech industry wage in Utah is $83,591, which is below the national average of $112,890. This could present a problem as Utah tech companies attempt to attract out-of-state talent. But Utah ranks slightly above average at number 24 on the list of states in terms of the wage differential of tech jobs. Tech workers earn approximately 82 percent more than the average worker in the state: $46,010.
- Not every job in the tech industry is a tech-focused occupation. For example, 44 percent of Utah’s tech industry jobs are actually tech occupation jobs (7,171 out of 16,478). This puts Utah at number 33 and below the national average of 46 percent.
- The tech industry is not among the top 4 industries by job gains from 2012 to 2017 in Utah. It was beat out by construction, retail, health care services, and professional services. However, the tech industry is ranked number 3 among industries by their economic impact, behind manufacturing and government, and ahead of finance and insurance.
Despite its challenges, Utah is in a good position to keep recruiting new employees and companies to its so-called Silicon Slopes. It will be interesting to see what the future has in store for it.
Photo credit: By Econ5470-90 [CC BY-SA 4.0 (https://creativecommons.org/licenses/by-sa/4.0)], from Wikimedia Commons