Concentration of IT jobs by ZIP code tabulation area (ZCTA ...

[Pages:12]As the largest institution of public higher education in Virginia, Northern Virginia Community College (NOVA) acts as a catalyst for economic growth in the capital region by providing access to highly skilled, credentialed, and diverse talent.

NOVA's Office of Corporate and Workforce Engagement advances this mission by collaborating with employers, economic development organizations, education institutions, communitybased organizations, and local governments in the northern Virginia region to address the skills gap and develop a robust talent pipeline.

NOVA Regional Workforce

Information Technology

Concentration of IT jobs by ZIP code tabulation area (ZCTA) in northern Virginia

Source: Chmura Economics & Analytics, JobsEQ.

NOTE: Individual dots do not represent exact locations of jobs/establishments, but are evenly distributed geographically across each ZCTA to represent the concentration of jobs in each area.

130,190

Total IT jobs in the NOVA region as of Q4 2018

$109,300

Average annual wage of IT workers in the NOVA region

113,505

Job postings in the NOVA region over the last 12 months

2nd nationally

The Washington D.C. metropolitan area's ranking for total IT employment and IT job postings

11,000

Total IT degrees and credentials awarded in the Washington D.C. metropolitan area in 2016-2017

NOVA

WORKFORCE

Information Technology Workforce | 1

Overview

Ever since Amazon announced that a major part of its HQ2 operations would be located in northern Virginia, the region's profile as a national tech hub has skyrocketed. Even before Amazon's announcement, the information technology sector in the Washington D.C. metropolitan area had been experiencing substantial growth, with northern Virginia at its core. As Amazon ramps up hiring over the coming months and years, and as other technology companies inevitably follow in its wake, the challenges associated with finding talent in such a competitive labor market will only continue to grow. 1

With this in mind, and with an eye towards better understanding NOVA's role in collaborating with employers and community partners to address these challenges as they arise, this brief examines the various facets of the information technology industry in order to determine where our region is now, and what the future may look like.

Definitions

Washington D.C. Metropolitan Area (D.C. MSA) The 25 counties (and independent cities) centered around the District of Columbia that are highly integrated economically and socially, as defined by the United States Office of Management and Budget. For the purpose of analysis, we consider four different sub-regions within the MSA:

NOVA Region The nine jurisdictions served by Northern Virginia Community College, including: Arlington County, Alexandria City, Fairfax County, Fairfax City, Falls Church City, Loudoun County, Manassas City, Manassas Park City, and Prince William County.

District of Columbia The city and federal district that lies at the core of the metropolitan area.

Suburban Maryland (MD) and West Virginia (WV) The counties in Maryland and West Virginia that lie within the Washington D.C. MSA, including: Calvert County, Charles County, Frederick County, Jefferson County (WV), Montgomery County, and Prince George's County.

Northern Virginia (Non-NOVA) The outlying Virginia counties composing the remainder of the Washington D.C. MSA that are not included in the NOVA Region. Includes: Clarke County, Culpeper County, Fauquier County, Fredericksburg, Rappahannock County, Spotsylvania County, Stafford County, and Warren County.

Information Technology Many types of occupations, such as in healthcare and manufacturing, are largely concentrated within a single industry sector. However, while technology companies may be the primary employer of IT workers,

IT talent is needed across the entire economy, from financial services and healthcare, to higher education and government. As a result, we will primarily be defining the IT "industry" in terms of those occupations that require specific technology skills and activities, regardless of the sector in which a worker is employed.

Figure 1. IT Workforce by D.C. MSA Sub-Region

Table 1 contains a full list of the occupations we have considered in this analysis, including the code and title used by the Bureau of Labor Statistics' standard occupation classification (SOC) system to formally define occupational categories for data collection and analysis. Since individual occupations typically encompass a range of related job titles, we have also provided a sampling of alternate titles that employers might use, as found in regional job postings. Finally, we have indicated the total employment for each occupation in the NOVA region.

1 Jonathan Capriel. "Lots of job openings, not enough workers and HQ2 on the way has Fairfax County on edge." Washington Business Journal, 28 March 2019. . html

Information Technology Workforce | 2

Table 1. IT Occupations in the NOVA Region

Group

SOC Code 15-1131

15-1132

SOC Title Computer Programmers

Software Developers, Applications

Alternate Job Title Programmer

Software Developer

Total Employment 5,783

21,780

Programming & Development

15-1133

Software Developers, Systems Software

15-1134 Web Developers

Software Engineer, Technical Consultant/Analyst

Web Designer, Front End Developer, User Interface/ Experience Designer (UI/UX)

14,917 2,843

17-2061 15-1121 15-1122

Computer Hardware Engineers Computer Systems Analysts Information Security Analysts

Computer Engineer Systems Analyst Cyber Security Analyst/Engineer

1,560 15,913 6,328

Networking & Systems

15-1142

Network and Computer Systems Administrators

Server Administrator

10,048

15-1143 Computer Network Architects

Solutions Architect, Systems Engineer, Enterprise Architect

5,206

15-1152

Computer Network Support Specialists

Network Technician, Operations Specialist

4,184

Data Warehousing & Analysis

15-1111

Computer and Information Research Scientists

Data Scientists, Research Engineer 1,112

15-1141 Database Administrators

Data Engineer, Database Developer, Data Center Technician

2,668

43-9021 Data Entry Keyers

Data Entry Associate

1,732

11-3021

Computer and Information Systems Managers

Chief Information/Technology Officer

9,118

IT Operations & Support

15-1151

Computer User Support Specialists

15-1199

Computer Occupations, All Other

15-2031 Operations Research Analysts

43-9011 Computer Operators

Help Desk Technician/Specialist, Desktop Support

11,512

GIS Technician, Data Warehousing Specialist, Business Intelligence Analyst, IT Project Manager, Video Game Designer

12,093

Process Manager, Decision Support Analyst

2,899

Console Operator, Data Center Operator, Data Management Clerk, 495 Data Processor

Source: Chmura Economics & Analytics, JobsEQ; Burning Glass Technologies: Labor Insight. 2019; O*NET OnLine. Information Technology Workforce | 3

Occupations

Table 2. Summary -- IT Employment in the NOVA Region

Current (Q4 2018)

Last 5 Years

Next 3 Years

Total Employment

Average Annual Wage

Unemployment Rate

Average Annual Growth

Total New Demand

Total

New

Separations* Growth

Average Annual Growth

130,190

$109,300

1.8%

1.2%

34,153

27,533

6,620

1.7%

NOVA Region

D.C . MSA

244,202 $109,500

2.4%

1.1%

62,783

51,445

11,339 1.5%

Source: Chmura Economics & Analytics, JobsEQ.

*Separations include demand resulting both from expected exits (individuals leaving the workforce due to retirement, etc.) and expected transfers (individuals moving into other occupations).

As of Q4 2018, there were a little over 130,000 information technology jobs in the NOVA region, representing over half (53%) of IT jobs in the entire Washington D.C. metropolitan area (Figure 1). Compared to the MSA as a whole, the NOVA region has been growing somewhat faster than average, and is projected to continue this trend, adding around 6,600 new jobs over the next 3 years (Table 2).

It is important to note that these projections do not yet include potential hiring from Amazon's HQ2. However, early indications from the company are that half of the 25,000 jobs expected over the next 10 years will be tech-related, with around 35-40% being for software developers and engineers,2 an occupation area that is already expected to make up around 42% of all new IT occupation growth over the next 3 years (Figure 2).

In addition to projected growth, another measure of an occupation's importance and potential demand in the region is its concentration in the regional economy compared to its concentration nationally, also known as an occupation's Location Quotient (LQ).

An LQ of 0.8 ? 1.2 usually means the occupation makes up a similar proportion of total regional employment as it does nationally, while an LQ higher than 1.2 means that the occupation makes up a greater share of the regional labor market than it does at a national level (and vice-versa for an LQ below 0.8).

All of the IT occupations examined for this brief had an LQ of 1.1 or higher, and collectively had an LQ of 2.9,

meaning that the industry overall is significantly more concentrated in the NOVA region than it is across the rest of the country. Even with this, a few occupations are particularly concentrated within the region (Table 3).

This includes information security analysts, likely due to the area's high volume of defense contracting, military intelligence, and data storage activity. Also included are networking occupations, critical to the many data centers and cloud computing operations in the region, as well as more specialized occupations such as computer scientists (which includes data scientists).

In addition to understanding where potential growth may be located within the industry, it is critical to be

Table 3. Highest Concentrated IT

Occupations in the NOVA Region

Total

Occupation

LQ* Employment

Information Security Analysts 6.5

6,328

Computer and Information Research Scientists

4.2

12,093

Computer Occupations, All Other 4.2

1,112

Software Developers, Systems Software

3.9

14,917

Computer Network Architects 3.6

5,206

Source: Chmura Economics & Analytics, JobsEQ.

2 Jonathan Capriel. "Amazon exec describes breakdown of future HQ2 workforce." Washington Business Journal, 7 March 2019.

Information Technology Workforce | 4

aware of occupations and industry areas that are contracting or declining in order to ensure that segments of the workforce are not under-skilled or mismatched with shifting labor market demand (Table 4).

Two of the three IT occupations expected to lose jobs over the next three years are also among the lowest paid, on average, for the IT industry in the region (Table 5). This would indicate that there is declining demand for lower-skilled (thus, lowercompensated) jobs. Indeed, as automated solutions become more adept at carrying out routine tasks in data entry, management, system operation, and even programming, the need for workers trained in these areas will continue to decline.3

Figure 2. IT Occupations Expected to Add the Most New Jobs over the Next 3 Years

Source: Chmura Economics & Analytics, JobsEQ.

Table 4. IT Occupations Expected to Decline in Employment in the NOVA Region over the Next 3 Years

Occupations

Total Employment

Projected Change in Employment

Computer Operators

495

-31

Average Annual Change

-2.1%

Computer Programmers

5,783

-98

-0.6%

Data Entry Keyers

1,732

-103

-2.0%

Source: Chmura Economics & Analytics, JobsEQ.

Table 5. IT Occupations with the Highest and Lowest Annual Wages in the NOVA Region

Highest

Occupation Computer and Information

Systems Managers Computer Hardware

Engineers Computer and Information

Research Scientists Software Developers, Systems

Software

Computer Network Architects

Average Annual Wages $170,300

$126,100

$125,500

$125,000 $119,900

Source: Chmura Economics & Analytics, JobsEQ.

Lowest

Occupation Data Entry Keyers

Computer Operators Computer User

Support Specialists Computer Network Support Specialists

Web Developers

Average Annual Wages $36,200

$50,000

$63,300

$81,400 $89,800

3 McKinsey Global Institute. A future that works: Automation, employment and productivity. McKinsey & Company, January 2017.

Information Technology Workforce | 5

Industries

Table 6. Top Industry Sectors Employing IT Jobs in the NOVA Region

Sector Title

IT Employment

% of IT Jobs Employed in Sector

Annual % Growth (IT

Jobs)

Professional, Scientific, and Technical Services

92,097

70.7%

2.2%

Annual % Growth (All Jobs)

1.6%

Information

11,503

8.8%

1.1%

0.3%

Public Administration

5,604

4.3%

0.3%

0.2%

Management of Companies and Enterprises

3,977

3.1%

0.7%

0.5%

Finance and Insurance

3,809

2.9%

1.5%

1.0%

Total ? Top 5 Sectors

116,990

89.9%

1.9%

1.2%

All Other Sectors

13,191

10.1%

0.6%

1.1%

Source: Chmura analysis of data from BLS's Quarterly Census of Employment and Wages (QCEW).

As mentioned above, IT occupations span a wide

expected to be relatively low, IT jobs in the sector are

range of industries. Even so, most IT jobs in the NOVA expected to grow at a much faster rate.

region (70%) lie within the professional, scientific, and technical services sector, which includes computer and systems design firms, as well as those primarily engaged in consulting, research, and engineering. Further, 90% of all IT jobs in the region lie within this and other professional sectors such as public administration, management, and finance; around a quarter of all employment in these industries is

Each industry sector can be further divided into groups of related industries focused on more specific business activities. Examining the concentration of IT jobs across these groups further highlights the unique composition of the regional IT industry and the areas of our economy most reliant on IT jobs. Of course, computer systems design and related services firms--what we might

composed of IT workers

(Table 6).

Table 7. Top Industry Groups

It is also useful to note that projected growth among IT occupations is at least one factor driving overall growth in the top 5 sectors in which the occupations are employed, with IT growth outpacing overall employment growth in each. So, even though overall job growth in the information sector--which includes industries and businesses engaged in the distribution of information such as broadcast and print media, as well as telecommunications--is

Employing IT Workers in the NOVA Region

Industry Group

Computer Systems Design and Related Services

Management, Scientific, and Technical Consulting Services

Data Processing, Hosting, and Related Services

Management of Companies and Enterprises

% of Industry Employed in IT Occupations

59.2%

5.9%

3.3%

3.1%

Average Annual Wage

Projected Annual % Growth (IT Occupations)

$162,900

2.3%

$159,400

2.4%

$152,800

1.8%

$159,500

0.7%

Source: Chmura analysis of data from BLS's Quarterly Census of Employment and Wages (QCEW).

Information Technology Workforce | 6

Figure 3. Industry Groups Employing IT Workers in the NOVA Region (by % of All IT Employment)

Groups Employing Over 1%: 22.6%

Computer Systems Design and Related Services: 59.2%

Groups Employing less than 1%: 18.2%

Source: Chmura analysis of data from BLS's Quarterly Census of Employment and Wages (QCEW).

consider "traditional" IT firms such as IBM and HP--employ well over half of all IT jobs in the region. Other groups in the professional services sector, such as management consulting, architecture/engineering, and scientific research are also prominent among industry groups employing at least 1% or more of the region's IT workers (Figure 3).

industries are also prominent. It is also important to keep in mind that because industry classification is designated on a firm-by-firm basis, it could be the case that these employers (such as SAIC) employ significant numbers of IT workers at establishments that may be categorized under groups other than the company's primary group designation.

Table 7 provides additional detail on the top four industry groups employing a total of over 2/3 of the IT workforce. In general, wages for IT jobs in these industries are much higher than average and employment in each is projected to grow much faster than average over the next 10 years. It may be the case that wages are much higher in these areas as employers must increase compensation in order to meet higher demand.

While the industry groups identified in Table 7 make up a significant share of regional IT employment, it is interesting to note that those employers posting most frequently for IT jobs in the NOVA region (Table 8) are spread across a variety of additional industry groups including engineering services (SAIC), accounting and bookkeeping (Deloitte), and electronic instrument manufacturing (General Dynamics and Northrop Grumman).

While job postings are a useful proxy for labor demand, they are not a perfect measure; for example, some employers may post for a job online simply to gather applications (without any actual open positions) or may post once for multiple identical positions. This may explain why, while a number of employers representing the top four industry groups are among those posting the most jobs in IT, these employers representing other

Table 8. Top Ten NOVA IT Employers

by Total Job Postings

Total

Corporate

Employer

Job Postings Employees

General Dynamics

5,820

105,600

Booz Allen Hamilton Inc.

4,619

24,600

SAIC

2,892

23,000

Capital One

1,912

47,600

ManTech International Corp.

1,855

7,800

Leidos

1,311

32,000

Northrop Grumman

1,270

85,500

CACI

1,218

18,800

Deloitte

1,170

40,000

Perspecta

1,159

2,000

Source: Burning Glass Technologies: Labor Insight. 2019. Employer NAICS categorization and Total Employees information from InfoGroup/Reference USA.

Information Technology Workforce | 7

Regional Comparison

In order to best understand the local IT labor market, it is also useful to place the region in context of other similar metropolitan areas, peer cities, and nearby regions. In this case, we compare the NOVA region to the Washington D.C. metropolitan area (MSA), other national MSAs with prominent IT industries, and two nearby MSAs, Baltimore and Richmond.

The D.C. MSA is second only to New York City in terms of the total number of people employed in IT occupations (Table 9). This is even more notable when considering that, despite ranking 6th in population size, it still manages to surpass the second most populous metropolitan area in the country in terms of IT employment (Los Angeles).

As the IT hub for the D.C. MSA, the NOVA region compares well to other metro areas even on its own, exceeding the number ten ranked MSA for total IT employment, Atlanta, and outpacing all others except for San Jose in terms the overall concentration of IT jobs (as a percentage of all area employment).

While not nearly as large or concentrated as in either the D.C. MSA or NOVA region, the IT industry in the Baltimore and Richmond MSAs make up an average to above-average portion of their overall labor

market--across all MSAs, IT occupations make up, on average, 3.5% of all employment, compared to 4.7% and 3.5% in Baltimore and Richmond, respectively. However, the makeup of the IT industry in these two nearby MSAs is significantly different than in the D.C. MSA broadly and the NOVA region specifically.

Figure 4 indicates the extent to which IT occupations are concentrated across various industry groups for the NOVA region, D.C. MSA, and nearby MSAs of Baltimore and Richmond--the concentration of IT occupations by group at the national level is also provided for reference, and the five groups displayed aside from computer systems design were those that had the highest concentration of IT workers at the national level.

Most IT jobs are concentrated in computer systems design and related services, regardless of location. However, IT jobs in the NOVA region are over twice as concentrated in these firms compared to the nation. Concentration in computer systems design is lower than average for Richmond, while IT jobs there are located to a much higher degree in firms responsible for the management of companies than in any of the other regions considered. While IT jobs

Figure 4. Concentration of IT Jobs by Industry Group for NOVA, D.C. MSA, and Other Nearby Regions

Source: Chmura analysis of data from BLS's Quarterly Census of Employment and Wages (QCEW).

Information Technology Workforce | 8

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