An Unexpected State With Strong Job Growth in Its Tech Sector

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It’s not California, Washington, or Texas.

It’s not surprising that Washington state, with its resident corporate behemoths like Amazon and Microsoft and Seattle’s thriving tech sector, has posted some of the nation’s strongest technology industry job growth figures among states over the past decade.

But another state near the top of that list may not be as obvious: Utah.

The Kem C. Gardner Policy Institute at the University of Utah this week released research that offers a deep dive into the state’s tech economy. Part of the report looks at how Utah and other states stack up against one another when it comes to tech industry jobs, growth, and wages.

It shows that between 2008 and 2018, Utah saw average annual employment grow in its tech industry by 4.9%, just shy of Washington, where the average rate was 5%.

“In terms of total employment and wages in the private sector, no state with an economy of Utah’s size had a larger tech industry in 2018,” said Levi Pace, a senior research economist at the Gardner Institute and the lead author of the report. 

The researchers also found that the tech industry job growth rate in Utah was more than double the growth rate in other industries there and more than triple the rate for the entire U.S. tech sector.

Checking in after Utah in the comparison of average annual job growth in the tech industry from 2008 to 2018 were: Washington, D.C. (3.1%), South Carolina (2.7%), and California (2.6%).

Growth is of course just one metric to compare states by.

In terms of total tech jobs in 2018, the report shows that California leads the pack, with 963,400 jobs in the sector. Texas is next (491,100), then New York (316,900), Florida (278,700) and Washington (245,200).

Utah ranked 22nd in 2018 among states when comparing them based on overall tech jobs, with 80,200 positions in the sector. But the researchers say it ranked fifth when comparing the share of tech jobs in a state to other industries in each place—in Utah the share was 6.4%

The highest share of tech jobs compared to other industries was in Washington (8.7%). It was followed by Virginia (7.5%), Massachusetts (6.6%) and California (6.5%).

Elsewhere in the report, in sections not comparing states, the researchers say that direct employment in Utah's tech industry was around 118,000 jobs in 2018. But this includes around 34,700 self-employed workers in partnerships or sole proprietorships.

The sections looking across states relied on a simplified approach to make consistent comparisons and do not include self-employed workers in the total jobs figure.

Software providers, makers of computers and related devices, and online retailers were some of the types of businesses that the researchers folded into their analysis of the tech industry.

They did not focus on in-house workers, like IT staff, at companies not primarily focused on technology.

Utah’s largest employers in the tech sector include businesses like aerospace and defense equipment maker L3 Technologies, the software company Adobe, Clear Link, which is a telecommunications firm, online retailer eBay, and the semiconductor company IM Flash.

Jobs in the industry pay relatively well. The report says average yearly pay for Utah tech sector jobs was about $106,100 in 2018. It was around $58,500 in other industries.

Utah ranked third among states in terms of its growth rate between 2008 and 2018 for total employee wages paid by tech companies, with an average annual increase of 6.9%. 

Ahead of Utah on this metric were Washington (9.6%) and California (7.1%). New York (4.6%) and D.C. (4.5%) rounded out the top five.

Much of the tech sector activity in Utah is concentrated in the Salt Lake City region. But of the state’s 29 counties, the report says 28 had at least one tech company.

A full copy of the report can be found here.