Leveraging Entrepreneurship Could Drive Yakima’s Tech Industry Growth

WTC’s 2005 Index Report shows Yakima suffered technology job losses; drawing attention to R&D activities in new and existing businesses could fill this gap and drive growth

Seattle, Wash. – June 23, 2005 – Yakima is beginning to see the economic results of an influx of innovation and technology into its industrial base. According to the Washington Technology Center’s 2005 Index of Innovation & Technology, continuing to drive entrepreneurial activity and technology development should create new opportunities for growth, despite recent technology industry job losses.
The Index, an annual benchmark report on Washington’s performance in technology industries, includes detailed data on 12 regions in the state, and evaluates them against critical drivers necessary to support specific aspects of a technology-driven economy.

On the surface, Yakima’s overall ranking against the technology measures in the 2005 Index was low. The region generally registered in the lower quartile when measured against 11 other regions in the state.* Yakima ranks 9th in total tech employment and 11th in tech jobs per capita. Total number of startups is small and the ratio of these high-tech births when compared to overall establishments is low – less than one-third of one percent. However, most communities, outside of Seattle, had birth rates below 1 percent. The region did experience a drastic negative change in tech jobs – a more than 32 percent loss – and 24 percent higher than the next lowest region.

Washington is coming off a recession which hit technology industries particularly hard and for mid-sized regions, like Yakima, job losses in this sector can appear even greater. The good news is that Yakima is showing signs of growing its entrepreneurial activity and technology development that could be expanded to accelerate growth and overcome these losses in the long term.

For example, Yakima ranked 7th among the 12 regions measured in the Index for patent activity. For a mid-sized community without a major research center, like a university or laboratory, this is significant. In addition, Yakima companies secured SBIR awards and registered private placements, both indicators of early stage financial capacity that can lead to product development and company sales growth.

These are exactly the kinds of investments that bring additional wealth and jobs into a region. By encouraging continued innovation in its business community, both through an influx of new technology ideas into more established traditional industries and fostering an environment that enhances new company creation, Yakima could drive more investments of this type into the region and begin to see a shift to a local economy bolstered by innovation and technology.

The Yakima County Development Association (YCDA) concurred with the WTC’s findings. “The index shows that the Yakima region has a ways to go in terms of building a technology-driven economy,” says YCDA President David McFadden. “At the same time though, we are an agriculturally driven economy, so I would not expect us to be at the top of the WTC’s index. I also sense that our technology employment numbers will bounce upwards” he noted. “The continued growth of companies like Adaptis, Code Correct, Praeclarent, and Maytag Services should offset technology job losses that occurred when ClientLogic closed its doors.”

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/. The Index received sponsor support from the following partner organizations: Spokane Area EDC, INTEC, enterpriseSeattle, Kitsap Regional Economic Development Center, and Pacific Northwest National Laboratory.

*Statistical data in the 2005 Index is from 2003, the most recent available at the time of publication.

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