Get the latest market trends in your inbox

Stay on top of the latest market trends and economic insights with the Axios Markets newsletter. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Denver news in your inbox

Catch up on the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Des Moines news in your inbox

Catch up on the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Minneapolis-St. Paul news in your inbox

Catch up on the most important stories affecting your hometown with Axios Minneapolis-St. Paul

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tampa-St. Petersburg news in your inbox

Catch up on the most important stories affecting your hometown with Axios Tampa-St. Petersburg

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!
Expand chart
Data: Information Technology Industry Council; Map: Andrew Witherspoon/Axios

The technology sector increasingly underpins the U.S. economy, with signs of its growth becoming more woven into local economies far outside iconic innovation hubs like Silicon Valley and New York.

Why it matters: A new district-by-district report out today from the Information Technology Industry Council makes the case that an economy infused with high-tech workers, startups and exports is a more resilient one, with higher wages and productivity.

What's new: Drilling into the data by congressional district yields some surprising findings:

  • The average congressional district now has about 400 high-tech startups employing around 3,400 workers.
  • Texas and Florida are home to four times the number of high-tech startups as the average U.S. state.
  • In Alabama, startups make up 16% of high-tech employment — the highest share in the country.
  • In Vermont, high-tech manufacturing exports make up 5.5% of the state economy — the largest share in the country.

"There is demand for skilled STEM workers, there is demand for public R&D funding, and even for high-tech startups in states across the country — not just in states we hear so much about," said ITI President and CEO Jason Oxman. "Companies are looking for opportunities to find good people in new geographies."

Yes, but: Despite shoots of green sprouting up across the country, many districts are still struggling to find a solid foothold. And there's concern that the COVID-19 pandemic will stunt some areas' tech-related growth even more.

  • For example, the Heartland region lags far behind coastal markets when it comes to attracting entrepreneurs and startups, according to a May report from Heartland Forward.
  • This is where skilled workers are key: "Knowledge-intensive young firms have a higher probability of achieving middle-market status where they can generate rapid job gains for their communities," per Heartland Forward.

The ITI data shows a strong correlation at the district level between employment in computer and math occupations and employment in science and engineering occupations — indicating that a density of high-skilled labor makes a region more attractive for skilled workers in other sectors.

  • This can impact wages.
  • In the median congressional district, average annual wages for high-tech workers in the median state were nearly $79,000. That's more than double the median U.S. personal income, which is around $31,000 annually.
Expand chart
Data: Information Technology Industry Council; Map: Andrew Witherspoon/Axios

There's a clear correlation at the congressional district level between the prevalence of high-tech and STEM workers and federal R&D funding, ITI's data analysis found.

The catch: The decades-long slide in public R&D funding has accelerated since 2009, according to the Information Technology & Innovation Foundation, which analyzed the numbers last year.

  • As of last summer, the federal government invests about $125 billion per year in R&D on everything from agriculture to manufacturing to energy. But that investment as a share of overall U.S. GDP has continued to decline. Meanwhile, countries including China have increased this spending.

By the numbers: In the last two fiscal years, 250 out of 435 congressional districts got at least $50 million in federal R&D funding.

  • 14 states did not get any public R&D funding.

The bottom line: The tech economy isn't a one-size-fits-all proposition, and regions should build on their strengths.

  • Smaller markets have managed to capture pieces of the innovation infrastructure needed to drive high-tech ecosystems, but many have a long way to go.
  • "It is really important for states and congressional districts to focus on what they're good at and not try to be the next San Francisco," Oxman said.

Go deeper

Nov 12, 2020 - World

The China tech selloff pauses

Illustration: Eniola Odetunde/Axios

Tech stocks rebounded slightly in China after Wednesday’s selloff that had been prompted by new antitrust rules proposed by Chinese regulators.

Why it matters: The regulations could limit the power of China’s biggest tech companies. By the FT’s math, the country’s tech sector lost $290 billion in value in the space of two days.

Using apps to prevent deadly police encounters

Illustration: Sarah Grillo/Axios

Mobile phone apps are evolving in ways that can stop rather than simply document deadly police encounters with people of color — including notifying family and lawyers about potential violations in real time.

Why it matters: As states and cities face pressure to reform excessive force policies, apps that monitor police are becoming more interactive, gathering evidence against rogue officers as well as posting social media videos to shame the agencies.

Dan Primack, author of Pro Rata
14 hours ago - Technology

TikTok gets more time (again)

Illustration: Aïda Amer/Axios

The White House is again giving TikTok's Chinese parent company more to satisfy national security concerns, rather than initiating legal action, a source familiar with the situation tells Axios.

The state of play: China's ByteDance had until Friday to resolve issues raised by the Committee on Foreign Investment in the U.S. (CFIUS), which is chaired by Treasury secretary Steve Mnuchin. This was the company's third deadline, with CFIUS having provided two earlier extensions.