NorTech, Northeast Ohio’s technology-based economic development organization, recently released a report that analyzes growth in the region’s high tech industries. The report entitled, “The High Tech Sector in Northeast Ohio: Baseline Report,” will serve as a foundation for monitoring changes in the high tech sector in Northeast Ohio. The report was prepared for NorTech by the Center for Economic Development at Cleveland State University’s Maxine Goodman Levin College of Urban Affairs.
The report identifies some important strengths in Northeast Ohio’s high tech sector. At more than $62,000, the average wage for Northeast Ohio’s high tech industries was 72 percent higher than the average wage for all industries in 2005. The gross regional product of Northeast Ohio’s high tech industries increased between 2000 and 2005 and accounted for 12 percent of the total economy in 2005 (the share of high tech employment was 8%). In addition, productivity in high tech industries was 52 percent higher than average productivity for all industries in 2005.
Although the share of high tech employment declined in both Northeast Ohio and the U.S. between 2000 and 2005, some individual industries experienced job gains. In Northeast Ohio these include Pharmaceutical and Medicine Manufacturing; Scientific Research and Development Services; Electric Power Generation, Transmission and Distribution; Management, Scientific and Technical Consulting Services; Management of Companies and Enterprises (headquarters); and Facilities Support Services.
In 2005, approximately 58,000 workers in Northeast Ohio's metropolitan areas were employed in high tech occupations, accounting for 3.1 percent of all workers. The distribution of NEO's high tech workers within occupational clusters reflects the region's industry mix, with nearly 38 percent of Northeast Ohio's high tech workers in Architecture and Engineering occupations, a higher proportion than found nationally.
“This report provides us with a baseline for understanding Northeast Ohio’s high tech industry and employment trends. While some findings are promising, there is still much work that lies ahead in order to transform our region into a more sustainable, innovation-focused technology hot spot. We believe the recent additional focus and investment in technology-based economic development will begin to ‘move the needle’ for some of the high tech measures in this report,” said Dorothy Baunach, president and chief executive officer of NorTech.
“This report shows the importance of the high-tech sector to the Northeast Ohio economy. Although total number of high-tech jobs declined in both Northeast Ohio and nationally, high-tech jobs paid higher average wages, the sector’s gross regional product (or output) increased, its productivity grew, and the share of the high-tech sector in Northeast Ohio is becoming more similar to its share nationally,” said Ziona Austrian, Ph.D., director of the Center for Economic Development at Cleveland State's Levin College of Urban Affairs.
“Recent research shows us the importance of innovation to the success of regional economies. Clearly, high technology industries are an engine of innovation. This report can help give us a sense for where we are competitively, and what we might need to do to enhance the competitive assets of the region,” said Mark Schweitzer, assistant vice president and economist in the Research Department of the Federal Reserve Bank of Cleveland.
The Cleveland State research team used a definition of high tech industries and occupations developed by Daniel Hecker, an economist at the U.S. Bureau of Labor Statistics. This definition was used to study Northeast Ohio’s 21-county area consisting of six metropolitan regions (Cleveland-Elyria-Mentor, Akron, Canton-Massillon, Mansfield, Sandusky, and Youngstown-Warren-Boardman) and eight non-metropolitan counties.
The report complements the Dashboard of Economic Indicators project initiated and funded by the Fund for Our Economic Future, however this study focuses only on the high tech sector, while the Dashboard addresses all sectors of the economy. Because of the more narrow focus, it is possible to include an in-depth analysis of the individual industries that comprise the high tech sector. In addition, this study expands the geographic scope of the analysis to 21 counties in Northeast Ohio.
NorTech plans to have the report updated on an annual basis and use the findings as one method of measuring technology-based economic development in Northeast Ohio over the coming years. Updates will also be used to inform strategic planning efforts, educate policy makers and inform funding sources. The first update will be released in late summer 2007.
The complete report can be found at: http://www.nortech.org/resourcelibrary/resourcelibrary.aspx or http://urban.csuohio.edu/economicdevelopment/publications.shtml. For additional information about this study, please call Dorothy Baunach at 216-363-6883 or Dr. Austrian at 216-687-3988.
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NorTech:
NorTech is the catalyst for making Northeast Ohio a global leader in technology and innovation by creating, expanding and retaining global business opportunities. We connect the technology leadership of Northeast Ohio, secure the necessary funds and resources for pilot projects and successfully launch them as independent entities while fostering a dynamic and sustainable, innovation infrastructure in the region. Our shared vision for the region is to become one of the top ten places in the world to live, learn, work and invest by 2020. www.nortech.org
Center for Economic Development (CED) at Cleveland State University’s Maxine Goodman Levin College of Urban Affairs:
The Center for Economic Development encompasses research and technical assistance activities aimed at furthering the development potential of the Cleveland region. It concentrates on economic impact analyses, industry clusters, economic indicators, and investigating innovation and entrepreneurship. The CED is one of 12 research centers within the College that provide applied research, technical assistance, and training to public officials, community leaders, and the private sector with the objective of enhancing the quality of life in urban communities.
The Maxine Goodman Levin College of Urban Affairs is ranked among the top eight schools of urban affairs in the United States. The College is ranked second in the graduate specialty of city management and urban policy in U.S. News and World Report’s 1998, 2002 and 2005 issues of “America’s Best Graduate Schools.” The College offers 12 degree programs: bachelor’s, master’s, Ph.D. and dual degree programs that provide the opportunity to earn the Juris Doctor (JD) with a Master’s in Public Administration (JD/MPA) a Master’s in Urban Planning, Design, and Development (JD/MUPDD), or a JD/Master of Arts in Environmental Studies. The College is also home to Economic Development Quarterly (EDQ), the leading journal in the field of economic development. http://urban.csuohio.edu/economicdevelopment/index.shtml
The Federal Reserve Bank of Cleveland:
The Federal Reserve Bank of Cleveland is one of twelve regional Reserve Banks that, along with the Board of Governors in Washington, D.C., comprise the Federal Reserve System. As the nation's central bank, the Federal Reserve System formulates U.S. monetary policy, supervises banks and bank holding companies, and provides payment services to financial institutions and to the U.S. government. Payment services include check clearing, electronic payments, and the distribution of currency and coin. www.clevelandfed.org/
The Dashboard (Produced by the Fund for Our Economic Future)
The Fund For Our Economic Future has released a seminal study of the Northeast Ohio economy that mathematically analyzes economic data and determines that there are eight key factors of regional economic growth. Conducted by the W.E. Upjohn Institute for Employment Research and Kleinhenz and Associates, in partnership with the Universities Collaborative and the Federal Reserve Bank of Cleveland, The Dashboard Indicators for the Northeast Ohio Economy establishes statistical correlations between economic growth in jobs, output, worker productivity and per capita income, and the eight key factors.
The Dashboard Indicators for the Northeast Ohio Economy is based on statistical analysis, not on anyone’s agenda or preconceived ideas. The study allows public policy makers, business people, civic organizations and the general public for the first time to see beneath the surface of an economy and to understand the full range of factors figuring in a region’s economic performance. The study will be used to guide policy makers when developing targeted programs for addressing specific factors of the economy and to track the effect of such programming. For organizations working together toward economic development across the region, the Dashboard provides a common point of reference. www.futurefundneo.org