By: Sharon Florentine
The software industry has an enormous impact on the U.S. economy, GDP and employment nationwide. Based on data from a BSA — The Software Alliance’s survey, here are the top 10 states for software jobs.
Software has an enormous impact on our individual lives, but the impact on the economy, GDP and employment is even greater than expected, according to study from BSA – The Software Alliance, an international alliance that advocates on behalf of the software industry. The Economic Impact of Software research study shows that, as of 2014, the software industry was responsible for a total of $1.07 trillion of U.S. value-added GDP, and directly drove $475.3 billion of that amount. The software industry directly employed 2.5 million people in the U.S., but when including indirect and induced impacts, that number rose to 9.8 million jobs, according to the research.
BSA worked with The Economist Intelligence Unit to compile the data, using publicly available data from the EIU itself, IMPLAN, the National Science Foundation, the U.S. Bureau of Economic Analysis, the U.S. Bureau of Labor Statistics and the U.S. Census Bureau. To estimate the total contributions of the software industry to the U.S. economy, the EIU analyzed the direct contributions and estimated indirect and induced impacts using various economic multipliers.
“What’s so interesting is how widespread the impact is. We expected states like California and Washington, but even states like Nebraska, Alabama and Utah showed a significant impact on their economies from software. And so much is happening in the industry: Cloud, artificial intelligence, big data, predictive analytics, virtual reality, enterprise, 3D printing — there are so many innovations happening, and they’re happening in every state,” says Victoria Espinel, president and CEO of BSA – The Software Alliance.
While every state is directly affected by the software industry, here are the top 10 states where software’s having the greatest impact based on direct contribution to GDP, direct number of software jobs created and total number of software, software-related and software-adjacent jobs created.
The heart of the software industry lies in Silicon Valley and the San Francisco Bay area, so it’s no surprise that California tops the list. The Bureau of Labor Statistics also shows that in California, the average software salary was $206,00.
New York’s Silicon Alley is in the New York City metropolitan area; The Big Apple also boasts numerous financial and digital creative agencies, all of which are dependent on software and related jobs.
One of the fastest-growing tech hubs in the U.S. is in Austin, Texas, also known as the Live Music Capital of the World. A business-friendly tax policy and low cost of living allows the software industry to thrive here.
Amazon, Microsoft and Expedia all call Washington state home, and in 2013, it was named the most innovative state in the U.S., even beating out California for that honor.
Virginia’s proximity to the U.S. capital in Washington, D.C. makes it a bedroom community for government employees, but cities like Richmond, Fairfax, McLean and Newport News all have thriving tech communities as well.
Boston has emerged as a major player in the software industry, and the proximity to Massachusetts Institute of Technology, Boston College, Boston University and other research-centric schools ensures an elite and innovative talent pool for software companies.
The Garden State’s proximity to both the New York City and Philadelphia metro areas puts it in a unique position. New Jersey’s home to many legal firms and pharmaceutical companies, all of which need talented software professionals.
While there are software companies — and hot software jobs available across Illinois, Chicago’s emerged as a thriving digital and creative hub as well as being a major hotspot for the software industry.
With its warm, sunny climate, low cost of living and business-friendly tax policy, Florida is attracting more and more software industry jobs.
Cities like Pittsburgh and Philadelphia are obvious centers for software industry innovation, but even in the capital city of Harrisburg, software jobs continue to thrive.