Woburn, MA, June 26, 2002—The Massachusetts high-technology industry grew by an anemic one percent last year, with tech jobs reaching 252,400. Massachusetts's tech industry added 3,700 tech jobs in 2001, compared to 26,900 in 2000, according to Cyberstates 2002: A State-by-State Overview of the High-Technology Industry, a new analytical report released today by AeA. Massachusetts ranks 4th among all 50 states and is considered a leading Cyberstate.

"This data show how important it is for the state and federal government to support policies that help create and maintain jobs here and which fuel the innovation for which Massachusetts is world renowned," said Anne Doherty Johnson, executive director, AeA New England Council. "When the economy is operating on all cylinders, our performance is typically better than the rest of the country, and conversely, during tough economic times like now, our companies get hit hard," she said. "That said, Massachusetts stands well-positioned for the upturn".

"Luckily, Massachusetts has important strengths that should help our state to participate strongly in the recovery now underway," said Joseph Alsop, CEO of Progress Software, a Bedford-MA based software company. "These strengths include leading universities researching new technologies and educating the talent on which high tech depends, and a state government, which eschews simplistic approaches and works cooperatively with the high-tech industry for the benefit of all Massachusetts citizens. In addition, our state is home to thousands of ‘natural born entrepreneurs’ who continue to attract the second highest level of VC investments in the country," he said."

"Considering that telecom and IT engineering account for a large portion of our high-tech jobs, I think it's encouraging to see a net job growth over that time period," said Elizabeth Ames, the state's Director of Economic Development. "Both of those sectors were hit tremendously hard over the last 12-18 months and lost a significant amount of jobs. But because we're well-diversified in high tech and some sectors such as biotech were experiencing upswings, we could sustain those hits. The dropoff in export revenues is probably the most disconcerting data within the report and once again punctuates the impact of the telecom industry's performance on our state economy"," she said.

Nationally, Cyberstates 2002 shows that high-tech industry employment grew slightly in 2001, reaching 5.6 million, compared to 5.5 million in 2000. This one percent increase illustrates the effect of the technology slowdown in 2001, compared to nine percent growth in 2000.

Cyberstates data also shows that electronics exports from Massachusetts dropped dramatically in 2001, decreasing 21 percent to $9.3 billion from $11.8 billion in 2000, compared with a national decline of 15 percent. Massachusetts’s high-tech industry exports represented 53 percent of total exports from the state in 2001.

Cyberstates 2002 also shows that venture capital investments in Massachusetts dropped by 53 percent between 2000 and 2001, dropping from $10.5 billion to $4.9 billion.

Cyberstates 2002 is the sixth edition of AeA’s Cyberstates reports. The study includes nine chapters detailing national and state trends in employment, wages, and exports. Venture capital investments, research and development (R&D) expenditures, and computer and Internet home use are also examined. The report includes state rankings for each indicator. Cyberstates 2002 is based on the most current U.S. government data available.

What Does High Tech Mean for Massachusetts?

• High-tech workers earned an average wage of $86,100 (3^rd ranked), or 91% more than the average private sector wage in 2000

• 9,000 high-tech establishments in 2000, ranked 9^th nationwide

• A decrease of $2.5 billion in high-tech exports between 2000 and 2001

• Venture capital investments declined by 53% between 2000 and 2001, dropping by $5.5 billion

Source: Cyberstates 2002
Data are for 2001 unless otherwise noted. 2000 data are the most current for wages, payroll, establishments, and industry segment jobs