Austin has solidified itself a national leader in the tech-heavy "advanced industries" sector, according to a new report from a Washington-based think tank.
The Brookings Institution, a nonprofit research organization, put Austin in the top 10 on a list of cities with thriving “advanced industries.” In terms of advanced industries’ share of the economy, Austin is ninth in the U.S., according to the report, “America’s advanced industries: New trends.”
Brookings says advanced industries “encompass the nation’s ‘tech’ sector at its broadest and most consequential.” And the Metropolitan Policy Program at Brookings defines advanced industries as those that spend at least $450 per worker per year on research and development employ, claim at least 20 percent of their workforce in STEM (science, technology, engineering, and mathematics) occupations.
Advanced industry jobs account for only about 9 percent of the nation’s total employment, but they remain vital for the country overall. The jobs tend to come with higher than average wages, and they result in more than their share of exports, compared with other sectors, Brookings said.
Mark Muro, senior fellow and policy director of the Brookings Institution’s Metropolitan Policy Program and author of the report, said Austin’s advanced industries are tied to the greater digital boom, and as a result the area should be in good shape for years.
“Austin is one of the 10 or so deepest, most diversified and competitive advanced industries centers in the country,” Muro said. “Austin is a mashup of multiple important industries now.”
Being home to multiple industries — including computer systems, energy, medicine, semiconductors, data analytics and manufacturing — is especially beneficial for Austin, Muro said.
In Austin, advanced industries employed 127,514 full-time workers in 2015, the report showed. The largest portion came from the computer systems design subsector, with 31,540 jobs in 2015.
The average salary for employees in advanced industries was $100,557 in 2015, compared with $55,909 for all industries, Brookings reported. Additionally, 102,010 more jobs sprouted in related industries in the region.
Austin also witnessed growth in advanced industries in the period from 2013 to 2015. Brookings said the annual average growth in terms of output in Austin was 7.76 percent, compared with 2.7 percent nationally. As for jobs, Austin saw a 5.98 percent annual growth, compared with 2.46 percent nationally in advanced industries.
Texas-based economist Ray Perryman, president and CEO of the Perryman Group, called the report's findings "encouraging for the Austin area."
"The Brookings report confirms what we've been seeing: That the Austin area economy is performing quite well in spite of the slowing national economy and the end of the oil surge. I look for that healthy growth to continue in the future," Perryman said.
Barbary Brunner, CEO of the Austin Technology Council, said the report validates Austin's reputation as an advanced and innovative community.
She noted that the report put growth in the Central Texas region on par with the rates in California’s Silicon Valley.
The credit deserves to go beyond the big players like Dell Inc. and Samsung, she said. Many of the region’s smaller firms use technology to fuel their businesses, as companies like HomeAway, Inc. and RetailMeNot, Inc., have done well in recent years, she said.
“Looking forward," Brunner said, "I think we will only see exponential growth.”
Additional material from American-Statesman reporter Shonda Novak.