AEA study says high tech employment and salaries coming back to 2000 level

The 10th Annual edition of the American Electronics Association [AEA] publication Cybestates: A Complete State-by-State Overivew of the High-Technology Industry has quite a few surprises buried within its 150 pages and thousands of statistics.

I spoke with the author of the study, Matthew Kazmierczak, vice president, research and industry analyst and we discussed some of the reports highlights.

The AEA breaks down high tech into four categories: manufacturing, communications services, software services, engineering and tech services.

The categories of most interest to us are the last two because these include those working in software publishing, computer systems design, customized programming services, electrical engineers, computer scientists such as programmers, system analysts and software engineers.

Although the industry has not fully recovered from its high point in 2000, it is slowly coming out of the downturn, says Kazmierczak.

This is the second year of job growth in the tech industry. In 05 87,000 jobs were created and in 06 there were 150,000 new jobs created.

In 2000 there were 6.6 million total jobs in high tech, in 2006 there are 5.8 million.

The average high tech salary in 2000 was $78,700, average annual compensation and adjusted for inflation. In 02 that bottomed out at $71,800 but has been growing ever since.

The average annual compensation in 05, no stats for 06 yet, is $75,500.

However compared to total salary for the private secotr high tech is 86 percent higher. The average annual compensation for all of the private sector is $40,500.

The fastest growing high tech sector is software services, engineering and tech services. Software services grew by 6 percent last year with a total of 88,500 jobs added to just this part of high tech, slightly more than half of all the high tech jobs created in 06.

The Cyberstates report also says that unemployment for electrical engineers is at 1.9 percent and for computer scientists, which includes programmers, system analysts, software engineers, it is 2.5 percent.

Kazmierczak, who is an economist by training, says that those percentages are considered full employment if you take into consideration the natural turnover rate.

Well, I guess it is full employment unless you are one of those 2.5 percenters.

Probably the most unusual stat coming out of the report is which states have the highest new job creation rate for high tech employment.

The four leaders are California with 14,000 new jobs in 06, followed by, here’s the surprise, Florida with 10,900, then Texas with 10,300 and in another surprise Virginia with 7,700.

Florida’s strength, says Kazmierczak, is in computer system design, software publishing and Internet services.

Virginia is seeing its job growth from computer system design which alone accounted for 4,000 of the 7,700 new jobs created.

The most startling statistic that Kazmierczak spoke of actually came from a Duke University study, Americas New Immigrant Entrepreneurs

That study says that for the ten year period between 1995 and 2005 one-fourth of all new high tech companies were created by a foreign national. Therefore, Kazmierczak concludes that if the U.S. had no cap on H-1B visas more not fewer jobs would be created.

It should be noted that the AEA, founded by David Packard, has over 2000 members all of whom are high tech employers and as such they support the idea of unlimited “skilled immigration.”