The Insider Archive
The Insider: The Philadelphia Region's Information Technology Sector - An Outstanding Competitor in IT and Improving Its Game
Innovation Matters, Volume 1, Issue 14 - April 23, 2008
Innovation Philadelphia's new study Creative Footprint, has uncovered particular strengths within the following industry sectors: Software Development; Communications and Marketing; Architecture, Engineering and Planning; Graphic and Visual Arts and Multimedia Design; Product Design and Merchandising; and Information Technology. Innovation Matters is taking an in-depth look at the big six, and here is what we've found about information technology:
The Philadelphia Region's information technology industry sector's economic impact on the Philadelphia Region is $2.1 billion annually. This creative occupation employs 44,000 workers with average annual wages of $70,600. Information technology firms comprise nearly 8% of all creative industry employment in the Philadelphia Region.
The Philadelphia Region's information technology industry - defined in Creative Footprint as all industries/occupations involving the servicing, producing and distributing computer, network and telecom equipment and services - houses impressive highly-skilled employees. Employment growth in recent years sets the stage to claim Philadelphia's reputation as a hub for information technology.
Notable Assets
Allocation of venture capital makes the Philadelphia Region an idea location for young IT companies. According to Select Greater Philadelphia, "There were 17 Information Technology (IT) venture capital deals (software, computers, peripherals and IT services) in 2006 totaling $79.6 million in funding, averaging $4.68 million per deal." Many of these companies have made it onto "fastest growing companies" lists.
Ed Epstein, Vice President of MISI Company, which provides user experience, consulting services, and technical resources to large and small companies, says that the Philadelphia Region is an ideal place for information technology professionals to work and play.
From a social perspective, Philadelphia provides an outstanding environment for the technology community to live, Epstein notes. "From a work perspective - between the far stretching regions of the suburbs, southern NJ, and DE - this region attracts and embraces a hot-bed of technology, life-sciences and financial organizations," he says. According to Epstein, the Philadelphia Region is an outstanding competitor in IT and improving its game.
The Philadelphia Region is home to numerous well-established information technology companies. According to the 2007 Philadelphia Business Journal's "Book of Lists", the region's largest computer consultant firms, by number of local employees, include agencies such as Computer Aid Inc. (CAI), Judge Group, LiquidHub Inc., Alliance Consulting, RCG Information Technology Inc. and SMART Business Advisory and Consulting. Combined, the top six computer consultant firms employ over 1,800 professionals in the Philadelphia Region.
Industry Growth
The information technology industry in the Philadelphia Region has "matured" in positive, significant ways in recent years, Epstein notes. "Not only has technology innovation exploded, more importantly its outcomes have shifted the 'way of life' of every business and every individual," he says. "Technology now alters how businesses start, manage and grow! In fact, it has flat-out created new communication, thoughts, markets, business and social sectors."
In recent years the region's IT needs have seen a steady growth and change in demand. "I've seen our industry transform over the past five to ten years from a 'dot com' environment to a more service oriented environment," said Drew Morrisroe, President and CEO of CTN Solutions, an IT services provider. "I believe there is no replacement for that personal touch even with all of the advancements of technology. Those who will succeed going forward must provide demonstrative value to their clients."
The City of Philadelphia and region have taken notice to this industry growth. The Mayor's Commission on Technology (MCOT) launched a monthly webcast program, "Philadelphia's Got IT," to promote Philadelphia as a city in-sync with the Digital Age. The goals of the program are to showcase Philadelphia partnerships that promote education, e-workforce and economic development and showcase high tech regional relationships, assets, resources and partnerships with business, government and community.
According to recent Brookings research titled An Economic Plan for the Commonwealth: Unleashing the Assets of Metropolitan Pennsylvania, advancement in IT in the Philadelphia Region is viewed as a strength that can be a catalyst to growth and prosperity for the Commonwealth of Pennsylvania.
IT Talent Development
For professionals looking to break into the information technology industry, Morrisroe suggests to be knowledgeable about changing technology. "I would advise a young person to be well rounded and never stop their education process. The ones who make it in this industry must know the technical aspects of their job at least at a conceptual level."
Epstein advises young professionals to "invest in yourself" as an information technology professional. "Keep your technology education and experience current if not advanced, and become actively involved in the community through network events and educational sessions," he says.
Creative Footprint reported that of the degrees awarded by Philadelphia Region Postsecondary Institutions, 16.2% of the degrees related to the for-profit, creative economy were for information technology. In addition, 14.3% of minority- and female-owned creative businesses in the Philadelphia Region are in the information technology industry sector.
The Philadelphia Region's colleges and universities are setting the bar for IT. According to the "Greater Philadelphia Regional Report 2007" published by Select Greater Philadelphia, "Three schools in the region - Villanova, Swarthmore, and Temple - were listed in the top 20 most wired campuses by the Princeton Review and PC magazine, with Villanova taking top honors in the nation."
A Creative Industry Sector on the Rise
A recent publication by Robert Half Technology reported that IT hires are expected to rise in the Philadelphia Region. A net 13% of chief information officers (from companies with 100 or more employees) surveyed said they expect to hire information technology professionals this quarter.
"Companies are investing in new initiatives and technologies such as server and network virtualization; Voice over Internet Protocol; and feature-rich, Web 2.0-type websites," said Katherine Spencer Lee, executive director of Robert Half Technology. "As a result, there is heightened demand for IT professionals with experience in these and other emerging specialty areas."
Nationally, Dow Jones VentureSource recently reported that information technology companies were responsible for $6.1 billion of the $7.8 billion in liquidity generated by mergers and acquisitions of U.S. venture-backed companies in the first quarter.
The findings in Creative Footprint illustrate the enormous potential of the for-profit, creative economy. In particular, the information technology industry sector holds tremendous potential in forming a new identity for the Philadelphia Region. Made a reality, this industry will offer economic benefits in the form of new jobs and new businesses and will increase the region's competitiveness across the nation. This new identity will make the region a destination for all businesses thirsty for creative talent.
Tell us what you think.