Innovation Index Reveals Steady Growth in Washington

Although technology sector employment is down slightly from previous years, Washington firms received twice the aggregate amount of venture capital (VC) funding compared to last year, and the state remains above the national average in educational attainment, according to the sixth annual Washington State Index of Innovation and Technology.



The index, produced by the Washington Technology Center (WTC), is divided into two parts - state measures and regional comparisons. State measures benchmark Washington against all 50 states, while regional comparisons look at how the technology economy is impacting 12 communities across the state.

These sections are built around 40 indicators and organized into six key areas: innovation, competitiveness, growth, financial capacity, human potential and quality of life. The index is meant to be both informative and influential. The goal is to "produce a report that serves as both a historical account of our state's performance and a tool to guide our state's leaders in economic planning," according to WTC Executive Director Lee Cheatham.



The slight decline in Washington's technology sector employment, which represents 11 percent of the state's total employment, is due to a loss of jobs within the aerospace industry, the index finds. The state lost some ground in new company creation, dropping to second place. Washington did place first for company closures, which have both positive and negative effects, according to the study. Although company closings cause distress in the workforce, they free talented people to pursue new ventures, the study states. Other key findings include:

• The number of firms receiving VC funding jumped from 104 in 2003 to 152 in 2004;
• For the fifth year in a row, Washington ranks first nationally in exports on a per capita basis and fifth nationally in export value;
• Small Business Innovation Research (SBIR) awards increased by 24 percent; and,
• Washington universities granted more than 3,900 science and technology degrees last year.

Job growth trends varied among the regions within Washington. According to the index, eight out of the 12 regions surveyed show some growth in technology employment, with some of the smaller communities showing the highest percentage of growth. In terms of total technology employment, Olympia leads the state, followed by Bremerton and Pullman. Bellingham leads the state in new company creation.



The 2006 Washington State Index of Innovation and Technology is available at: http://www.watechcenter.org/downloads/index_final.pdf



Links to this paper and nearly 4,000 additional TBED-related research reports, strategic plans and other papers can be found at the Tech-based Economic Development (TBED) Resource Center, jointly developed by the Technology Administration and SSTI, at: http://www.tbedresourcecenter.org/.



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