Strengths in Company Formation, Innovation & Investment Are Leading Indicators of Spokane’s Technology Economy Potential

WTC’s 2005 Index of Innovation & Technology report shows Spokane ranked high in start-ups, private placements, housing affordability and workforce skills.

Seattle – May 9, 2005 – Technology companies looking for a place to call home should seriously consider Spokane, Washington. According to the Washington Technology Center’s 2005 Index of Innovation & Technology, the Inland Northwest has the momentum in place to foster a technology economy.
The Index, published annually as a benchmark report on Washington’s performance, includes detailed data on 12 regions in the state, evaluating them against critical drivers necessary to support a technology-driven economy.

While Spokane only scored one top spot (housing affordability) in the regional comparisons, they reached the top three in several key categories. Spokane placed third in number of technology start-ups and third in total technology employment (13,016 jobs). Spokane showed a solid aptitude for financial investment, coming in third for private investments on a per capita basis.

Spokane possesses a number of attributes that make it an attractive place to start and build a technology business. The high rate of new company formation is encouraging as is the private investment ranking. Plus, affordable housing, a lower rate of technology wages, and an educated workforce, are all strong attractants for technology companies to consider when locating their business.

The region captured the number two spot for number of residents with a high school diploma and students showed higher-than-average performance in match & science proficiency. Both indicators are important in determining a region’s ability to supply a skilled workforce.

“I’m not surprised that Spokane placed high in the availability of skilled labor. Spokane’s universities and research facilities are really starting to draw the attention of businesses and students,” says Jon Eliassen, president and CEO of the Spokane Area Economic Development Council. “Many also continue to comment on the region’s low cost of doing business and affordable lifestyle. This, in combination with the area’s abundance of digital infrastructure, presents Spokane businesses and residents with some unique opportunities,” explains Eliassen.

However, to continue building a technology economy, Spokane will need to pay attention to areas where performance could improve. When comparing high tech companies to total establishments, Spokane ranked sixth out of the 12 regions. Spokane was one of the regions that experienced a loss in technology employment and technology jobs account for only 7 percent of overall employment, which is below the state average of 11 percent. While private investment numbers looked good, federal R&D fundraising was mediocre. Spokane placed 7th for federal SBIR awards. Only two awards were won in 2003 by Spokane companies.

“Our region’s public and private sector leaders have done a good job of laying the foundation for entrepreneurship,” says Bill Kalivas, executive director of ConnectNorthwest. “What we need to continue to focus on now is building on this foundation by helping companies promote their commercial potential. By connecting young companies to resources that can assist with funding, business growth planning and market entry strategy, the region will begin to realize the impact of these efforts through technology industry growth,” adds Kalivas.

WTC’s Index also includes a profile of Washington’s strengths comparing to other U.S. states. Washington has traditionally scored well on a number of indicators which points to the state’s ability to sustain a technology economy. For the fifth year consecutive year, Washington claimed the top spot for new company creation. Patent activity remained strong. Over 1,400 technology patents were generated, an increase of 8 percent from the previous year. This number has continued to climb since the Index was first published in 2000. Other significant trends for Washington include: One in ten jobs today is within a technology industry; Eleven out of the 12 regions showed growth in at least one of their core technology industries; Software saw the highest increase in employment and national dominance since 1998; Venture Investment in Biotechnology nearly doubled, increasing from 8 to 15 percent.

The full report is available on the WTC website at http://www.watechcenter.org/.

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