WTC’s 2005 Index of Innovation & Technology shows Tri-Cities rates high in technology employment; region could benefit from more equity capital and new company creation.
Seattle, Wash. – May 26, 2005 – The Tri-Cities is a major regional player in Washington’s technology economy. According to the Washington Technology Center’s 2005 Index of Innovation & Technology, Tri-Cities has a solid technology employment base which affects the economic landscape of Southwest Washington in addition to playing a role in boosting the state’s profile with respect to being an innovative region.
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.
The Tri-Cities scored top spots in several key categories. The region had the highest percentage of technology employment in the state – over 19 percent of jobs in the Tri-Cities are in technology fields.
Tri-Cities also placed second out of 12 regions in total technology employment (17,400 jobs) and technology wages. Tri-Cities was also one of four regions in the state that exhibited growth in all three of its dominant technology sectors and the region did well with respect to patent generation, placing fourth in the state in this measure.
Tri-Cities has a strong technology industry foundation.. This is attributed, in part, to mid-sized companies with significant operations locally. This is evident in the employment per capita numbers and tech wage rate, which is more than twice the annual wage rate in the region.
However, to encourage more involvement at the entrepreneurial level and create new opportunities for growth, Tri-Cities will need to pay attention to areas where performance could improve.
An example is the region’s performance in the area of financial investment. Tri-Cities ranked second in the state for federal SBIR awards, both in terms of total awards and on a per capita basis. Much of this can be attributed to Pacific Northwest National Laboratories. This facility provides a strong research base and drives government funding into the region.
However, when it comes to private equity investment, Tri-Cities’ performance was less stellar, ranking 7th out of the 12 regions measured. Right now there is a heavy reliance on government funding. Driving more private investment into the region would help balance this out and would also provide critical funding for early stage companies that could spin-out of these larger operations and create new industry clusters and new business opportunities in the region.
According to 2005 Index data, Tri-Cities didn’t see any significant growth in either overall employment or technology employment from the previous year. With respect to company creation, Tri-Cities ranked fourth when comparing the birth rate of tech companies to total companies, but in absolute numbers, this ranking drops to 7th for total technology start-ups.*
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 2005 Washington Index of Innovation and Technology can be downloaded from WTC’s website at http://www.watechcenter.org/. This year’s Index received sponsorship support from the following partner organizations: Pacific Northwest National Laboratory, Spokane Area EDC, INTEC, Kitsap Regional Economic Development Center, and enterpriseSeattle.
*Statistical data in the 2005 Index is from 2003, the most recent available at the time of publication.