Is the Tech Sector Leading Job Recovery?

Updated: July 28, 2011

According to the Bureau of Labor Statistics the unemployment rate as of June 2011 is hovering at around 9%. However, the tech sector is faring slightly better. In 2010, 47,000 planned layoffs occurred in the technology sector--a 73% decline from the year prior (and the "lowest yearly total for the sector since 2000") according to AOL Daily Finance. InformationWeek reported that 55% of IT professionals said their company will increase spending in 2011.

Additionally, the Bureau of Labor Statistics shows that the number of network systems and data communications analysts is expected to increase 53% by 2018, and the number of computer software engineers by 34%.

Even in 2010, signs that tech was leading the recovery were pretty strong. The Wall Street Journal reported that companies like Google and Intel Corp. posted huge profit jumps in the first quarter, rounding out the beginnings of a hiring "ramp-up" that began "with demand for tech goods and services stabilizing after months of declines." Google even hired 750 more employees in that quarter. Cisco and Intel hired employees in the thousands, while smaller companies, like Twitter and LinkedIn, added a few hundred.

Internet ad spending is also up about 2.6% across major corporations.

Moreover, the recent hiring binge in Silicon Valley could signal a "larger upturn for the U.S. economy," according to U.S.A. Today's report from March 2011. California added 100,000 jobs in February, reducing the unemployment rate from 12.2% to 12.4%.

Moreoever, the percentage of tech hires in 2010 was 17%, versus 14% in 2000, according to analysis by real estate consultant Jones Lang LaSalle. Facebook, Google, Zynga, Twitter, and Skype are all recent "leaders" of the hiring binge, according to USA.

At the end of 2010, BusinessWeek reported that the technology sector had added 47,000 jobs to the U.S. economy "amid resurgent demands for tech products in Asia and Latin America." That's 15% growth in tech jobs, versus 11% growth overall.

Some tech-related job growth is being aided by the government bailout in the auto industry. GM and Chrysler both announced in 2010 that they would be hiring thousands of new engineers and researchers.

Additionally, the emergence of "smart jobs" is a trend noted by economists and historians alike. Wired describes these jobs as "innovative and high tech, bust most of them are located far from Silicon Valley or New York. They're specialized, but that doesn't mean you need a PhD or even (in some cases) a college degree to get them or to do them well--though they do require some serious training, whether on the job or in a vocational program." They're jobs that "scramble the line between blue-collar and white-collar," that involve the manufacture of goods. Between the years of 2006 and 2010, the renewables and environment industry gained a 58.8% gain in employment numbers.

So, is tech leading the way in job recovery? Sure seems like it.

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