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Home » Tech industry lost 2 percent of work force

Tech industry lost 2 percent of work force

Manufacturing showed biggest drop among four sectors that agency tracks

October 15, 2009

The U.S. high-tech industry shed 115,000 jobs in the first half of this year, equating to a nearly 2 percent decline, says a report released last month by the Washington, D.C.-based TechAmerica Foundation and based on U.S. Bureau of Labor Statistics data.

The report looks at four sectors within the high-tech industry: high-tech manufacturing, communications services, software services, and engineering and tech services.

"The tech industry has suffered the full force of the global economic recession in the first half of this year, yet we believe it has weathered the storm better than most," says TechAmerica Foundation President Christopher W. Hansen. "Given that technology is an important economic driver, long-term investments and globally competitive tax policies are critical for encouraging technology companies to form and flourish in the United States and add new American jobs."

From June 2008—when the global financial crisis and economic downturn were gaining momentum—through June 2009, the industry lost 224,100 jobs, a 3.7 percent work-force decline. Over the same period, the U.S. private sector shed jobs at a faster pace—5.1 percent.

In the first half of this year, the losses were the greatest for U.S. high-tech manufacturing employment. Technology manufacturers shed 69,500 net jobs during that period, a 5.6 percent loss, leaving a total of 1.2 million tech manufacturing jobs in June. This represented 11.6 percent of total U.S. manufacturing jobs lost over that time period.

Total U.S. high-tech services employment also was down, but not as severely as manufacturing. Technology service providers trimmed 45,500 net jobs from January to June 2009, a 1 percent drop. In the other sectors, engineering and tech services lost 21,500 jobs, communications services lost 13,600 jobs, and software services shed 10,400 jobs, the data show.

Employment across the technology industry seems to have faltered compared with private-sector employment during this same six-month period. While high-tech employment declined by 1.9 percent from January to June 2009, private-sector employment held steady with 0.2 percent growth.

The apparent growth in private-sector employment reflects that the figures aren't seasonally adjusted, and, among other factors, include a temporary increase in employment nationwide that typically occurs at the beginning of June when schools close and there is an influx of youths and other part-time or temporary workers into the work force.

The more widely cited seasonally adjusted data, which remove these seasonal fluctuations, show that the private sector lost 2.6 million jobs, falling 2.3 percent, over that time period. A direct comparison isn't possible because seasonally adjusted data aren't available for high-tech.

All data are compiled from the U.S. Bureau of Labor Statistics' Current Employment Survey and are preliminary, subject to revision, and not adjusted for seasonal variances.

Launched in 1981, TechAmerica Foundation is a nonprofit affiliate of TechAmerica, which touts itself as a voice and resource for the U.S. technology industry. The Foundation disseminates industry information and organizes conferences and seminars to explore pertinent issues with government and industry representatives and to share its findings.

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