Note: The following facts about the information technology economy have been pulled from a variety of sources. All sources are listed at the end of the document.

The Information Economy

• Information technology industries have been growing at more than double the rate of the overall economy. They now represent 8.2 percent of GDP, up from 4.9 percent in 1985. (2)

• IT industries by themselves have driven over one-quarter of total real economic growth (not including any indirect effects) on average over each of the last 5 years. (2)

• The "Internet Economy" (made up of products and services ranging from electronic commerce to Internet infrastructure technology) generated an estimated $301.4 billion in U.S. revenue in 1998. (1)

• The average revenue per Internet Economy worker is about $250,000, or about 65 percent higher than their Industrial Economy counterparts. (1)

• U.S. businesses will spend over $200 billion on Internet technology deployment by 2002, comprising 20 percent of technology spending. (6)

• Without information technology, overall inflation would have been 3.1 percent in 1997, more than a full percentage point higher than the 2.0 percent it was. (2)

• Business-to-business e-commerce will rise to $1.3 trillion by 2003. (7)

• U.S. small office/home office firms spent $51 billion on information technology products in 1998 and are expected to spend more than $71 billion by 2002. (8)

• Online advertising soared in the second quarter of 1999 with revenues growing to $934.4 million. (9)

Employment trends

• In 1996, 7.4 million people worked in the IT sector and in IT-related jobs across the economy. These workers earned just under $46,000 per year, compared to an average of $28,000 for the private sector as a whole. (2)

• The number of "core IT employees" in the United States is 3,354,000, and the number of core IT vacancies is 346,000. Core IT employees are those in the three core IT occupational categories defined by the Bureau of Labor Statistics as computer programmers, systems analysts, and computer scientists/engineers. (3)

• More than 3.2 million vacancies in the core IT occupational categories will need to be filled in the next five years. (3)

• By the year 2000, 65 percent of the labor market will be required to possess high-tech skills. (4)

• "More employers want computer specialists to be knowledgeable about the industry their business is in, in addition to being technically skilled." (4)

• "Skill requirements have increased for many jobs in the U.S. economy, but a closer examination reveals a more complex relationship between technology and job content." (4)

• Employers spend an estimated $60 billion annually on education, training and upgrading skills of their employees. (10)

• Computer and data processing services will add over 1.3 million jobs from 1996-2006. (11)

• Jobs for computer engineers and systems analysts are expected to grow rapidly in order to satisfy expanding needs of scientific research and applications of computer technology. The three fastest-growing occupations are in computer-related fields. (11)

Indiana and the Information Economy

• Indiana produces almost 20 percent more college graduates at the bachelor's degree level, per capita, than the national average. (5)

• Indiana "exports" more than one-third of its college graduates to other states, and Indiana's retention of bachelor's degree-holders is almost 30 percent below the national average. (5)

• Job opportunities, compensation and other employment factors are the primary motivation for those who leave Indiana after graduation from college. (5)

• Indiana's labor force is increasingly concentrated in the two occupational categories that have ranked last in growth nationwide: machine operators and precision, craft and repair occupations. (12)

• Manufacturing jobs nationwide will account for 13 percent of total wage and salary worker employment in 2006, compared to 15 percent in 1996. (11)

• Precision production, craft, and repair occupations and operators, fabricators, and laborers are projected to grow slower than average due to continuing advances in technology, changes in production methods, and overall decline in manufacturing jobs. (11)

• A recent Central Indiana work force study conducted by the Hudson Institute confirms the importance of "moving the local economy more rapidly toward 'high-tech' industry and employment." (13)

• Indiana ranked 37th (out of 50 states) overall in the "New Economy Index," which includes factors such as involvement in the digital economy, capacity for technological innovation, and various work force indicators. (14)

• "While (states that rank lower in the New Economy Index) face challenges, they can also take advantage of new opportunities. The IT revolution gives companies and individuals more geographical freedom, making it easier for businesses to relocate, or start up and grow, in less densely populated states, farther away from existing agglomerations of industry and commerce." (14)

• In 1999, the Indiana General Assembly established the 21st Century Research and Technology Fund, a new $50 million investment fund aimed at growing more high-skill jobs and creating wealth for Hoosiers.

Sources:

1. The Internet Economy Indicators, Center for Research in Electronic Commerce, University of Texas, June 1999

2. The Emerging Digital Economy, U.S. Department of Commerce, April 1998 (http://www.ecommerce.gov/emerging.htm)

3. Help Wanted 1998: A Call for Collaborative Action for the New Millennium, Information Technology Association of America and Virginia Tech, March 1998

4. Futurework: Trends and Challenges for Work in the 21st Century, U.S. Bureau of Labor, September 1999

5. Graduation Migration From Indiana's Postsecondary Institutions, Indiana Fiscal Policy Institute, March 1999

6. Architects of the Internet Economy: Redesigning the Rules of Business, International Data Corp., June 1998

7. Forrester Research, press release, Dec. 17, 1998 (http://www.forrester.com)

8. International Data Corporation, 1999 (http://www.idc.com)

9. Internet Ad Revenue Report, Internet Advertising Bureau, November 1999

10. Skills for a New Century: A Blueprint for Lifelong Learning, U.S. Department of Labor, November 1999

11. Occupational Outlook Handbook, 1998-1999, U. S. Bureau of Labor Statistics

12. The Evolution of Indiana's Labor Force, 1968-1997: A Comparative Analysis, Indiana Fiscal Policy Institute, December 1998

13. An Assessment of Central Indiana's Workforce Development System, Hudson Institute, January 1999

14. The State New Economy Index: Benchmarking Economic Transformation in the States, Progressive Policy Institute, July 1999