Utah leads the country in tech sector growth

Wednesday , August 31, 2016 - 7:00 AM

With the recent news that Utah is leading the country in technology sector job growth, state officials say they’re pleased but not ready to celebrate — or take their foot off the gas.

According to U.S. Bureau of Labor Statistics, the Beehive State added the greatest percentage of tech jobs in the country during the first six months of 2016. Utah’s growth was 7.69 percent, leading all states. The other top-five finishers were Michigan (6.22 percent), Alabama (5.58 percent), Illinois (4.81 percent), and California (3.42 percent).

Writer Nick Kolakowski reported the figures on Dice.com

Val Hale, executive director of the Utah Governor’s Office of Economic Development, says the numbers didn’t surprise him.

“We’ve known that our tech sector was growing rapidly, we’ve seen the jobs all around us,” Hale said on Tuesday. “... Now we need to keep our head down, and keep working.”

As pleased as he is with Utah’s tech growth, Hale says it could be so much greater.

“Many more jobs could be filled — we just don’t have the qualified workers to fill them,” he said.

An estimated 15,000 tech jobs in the state of Utah are currently unfilled. If Utah had all of the skilled workers its tech companies need, that 7 percent six-month growth number could look more like 10 percent, or even 15 percent, according to Hale.

“That’s the No. 1 complaint — not just in tech, but in every sector — not enough workers,” he said. “A lot of these jobs require specific skills, and you can’t just hire anybody from off the street.”

Jonathan Jackson is the chief operating officer for the Salt Lake City-based Utah Technology Council, a professional association that for 25 years has considered itself the “voice of Utah’s technology ecosystem.” He agrees that finding qualified talent to fill tech jobs is the major hurdle in the state.

“I think it’s a well-educated state,” he said. “The problem is, there’s just not enough engineering and computer science talent to fill the positions.”

Jackson said tech jobs are the best-paying jobs in the state, with 80 percent of the starting salaries among UTC member companies in the $60,000 to $100,000 range. That tells him the technology sector is “very robust” in Utah.

“It just confirms what we’ve already found as we survey member companies,” he said. “We found that 95 percent of the tech companies are growing and thriving. I’m not sure what other industry can say that about its companies.”

Although tech companies are looking for quick fixes for the workforce problem — they need employees now — Hale says the state is trying to address both short-term and long-term solutions. Among the short-term solutions are things like “coding camps” to teach computer coding and programming.

“But the longer-term solution is through STEM (Science, Technology, Engineering and Mathematics) programs in the schools,” Hale said. “I think one of the things that has fueled our growth is our great higher-ed institutions. We graduate a lot of students here, and schools have started focusing on the types of programs that lead into these types of jobs.”

Hale points to universities graduating engineers, scientists and mathematicians in ever greater numbers. He also highlights the migration of people coming to take jobs in the state — the cost of living in Utah is significantly less than in Silicon Valley and other big cities.

“And the quality of life is better,” Hale said. “For many millennials, quality of life is a big issue. Being 20 minutes from a ski resort, or 15 minutes from a mountain biking trail, is important to them.”

The greatest concentration of tech jobs right now is in the northern end of Utah County and the southern end of Salt Lake County.

“That’s the epicenter,” according to Hale.

However, he also points to companies like the online education company Pluralsight, in Farmington, and “some pretty good tech companies in Logan.”

Jackson said his organization considers Utah’s tech industry to be along what is referred to as “Silicon Slopes” — along the Wasatch Front from Logan to Provo.

As impressive as Utah’s 7.7 percent growth in the first six months of 2016 may be, Jackson believes more can be done.

“Although we’re pleased with that number, it could be much, much higher,” he said. “If we could improve our talent pipeline in the state, that number could trend even higher in the coming years. It’s good, but it’s not good enough for us. We realize there really is a lot of work ahead of us to solve and better prepare the workforce.”

And Hale emphasizes that explosive tech growth is only one slice — albeit an important slice — of Utah’s economic pie.

“I think the tech industry is one of the reasons we consistently rank at the top with our economy,” he said. “And the good news is, we’re not just a tech state. We’re the third-most diverse economy in the country — that’s why we’ve been doing so well.”

Contact Mark Saal at 801-625-4272, or msaal@standard.net. Follow him on Twitter at @Saalman. Like him on Facebook at facebook.com/SEMarkSaal.

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