Tri-Cities boasts numerous science and tech workers but few firms

By D. Patrick Jones

Most everyone knows that the tech pulse is strong in the Tri-Cities. The problem is, it’s hard to find the pulse in official data. The same challenge applies for presence of the technology sector in Benton-Franklin Trends.

Where in the trends site might we find some coverage? Consider data from the “Share of Employment in the Top-5 Employing Sectors” chart.

D. Patrick Jones, Eastern Washington University’s Institute for Public Policy & Economic Analysis
D. Patrick Jones, Eastern Washington University’s Institute for Public Policy & Economic Analysis

The graph makes it clear that the administrative and waste services sector ranks fifth. (It’s the top bar in the graph.) While this sector can include call centers, it really doesn’t for the two counties, so the emphasis should be on the latter part of the heading. In other words, the “waste services,” or Hanford sector.

But does the cleanup effort on the Hanford site involve technology workers? Absolutely yes. According to a Washington State Employment Security data file “industry-occupation matrix,” two-thirds of the staffing in the local waste service industry consists of science, technology, engineering and mathematics workers.

Hundreds of engineers are part of that mix, mostly civil.

There is a further representation of science and tech in the Trends data, albeit a bit tucked away. Not shown in the graph is the sixth largest sector, by employment, “professional, scientific and technical services.” Online readers can find it via the download data tab. Not all firms in this sector are STEM-heavy—for example, law firms, accountant offices and advertising agencies. But many are—architects, engineering firms and, above all, Pacific Northwest National Laboratory.

The definition of STEM professions has several variants. For purposes of this analysis, we will include the usual components—but not health care. Earlier this year, the Tri-Cities Area of Journal of Business ran a column about that sector. This isn’t to say or deny that health care is based increasingly on sophisticated technology, only that it’s recently been covered by this column.

If health care were to be added to the mix, as it often is in STEM definitions, the Tri-Cities would show three of the six largest-employing sectors with a tech tilt. This is unique among Eastern Washington metro areas.

Besides considering the tech pulse through industries, we can take it through occupations. Occupations are not tracked in the trends data, but information is available, again from ESD. Generally, everyone who qualifies for unemployment insurance system in the U.S. is given a six-digit standard occupation code, or SOC. These roll up to higher orders or categories. Let’s consider a few broad, unassailably tech or science SOC categories: computer and mathematical; architecture and engineering; life, physical and social science; computer and information systems managers; and natural sciences managers.

What is the share of these professions in the two counties? In 2017, they claimed about 9.2 percent of the workforce. This is the largest slice of the employment pie in any Eastern Washington metro area. For Washington state that year, the analogous share was 9.9 percent. This result is no surprise, as it’s driven by the exceptionally large computer occupations category of King County.

But has the wealth of STEM talent in the Tri-Cities translated into start-ups? This is difficult to tease out of the data, since the results are only available on a “net” (starts minus exits) basis. We do know from trends data that since 2003, a net balance of about 1,200 firms has been created in the two counties.

That’s a cumulative growth rate of 16 percent. The professional, scientific and technical services sector has actually done better, picking up more than 550 jobs, for a cumulative growth rate of 39 percent. But are those new firms securely in the technology space? Or are they largely accounting, advertising and law firms? We simply cannot tell from the official numbers.

On the basis of a quick scan of names in the local marketplace, it would appear that not too many tech companies with significant revenues are present. A significant exception is Isoray Inc. Let’s hope that the good work of Fuse and the Tri-Cities Research District will lead to several more. The talent looks to be present. Is the entrepreneurial spirit?

D. Patrick Jones is the executive director for Eastern Washington University’s Institute for Public Policy & Economic Analysis. Benton-Franklin Trends, the institute’s project, uses local, state and federal data to measure the local economic, educational and civic life of Benton and Franklin counties.

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