Study by a technology think tank indicates northern Nevada is on the growing edge
January 23, 2017
A study by a technology think tank indicates the high-tech boom is spreading nationally, and northern Nevada is on the growing edge.
The Information Technology and Innovation Foundation (ITIF) "High-Tech Nation" study released late last year examines 20 indicators of an innovation-driven high-tech economy to paint statistical portraits of all 435 U.S. Congressional Districts, all 50 states, and the District of Columbia.
The study demonstrates that high-tech innovation plays a critical role in the economy in all four congressional districts in Nevada.
Nevada Congressional District 2, which covers the northern Nevada counties of Douglas, Carson City, Washoe, Pershing, Humboldt, Elko, Eureka, and Landers, shows significant high-tech activity, especially when compared to U.S. median data and economically similar districts.
Dave Archer, president and CEO of NCET (Nevada's Center for Entrepreneurship and Technology), has had a front row seat for northern Nevada's technology growth in the last decade.
"People are paying attention now because (technology) really has increased," Archer said in a phone interview with the NNBW.
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He noted that the region includes technology giants such as Tesla and Switch, plus small technology entrepreneurial startups.
"A lot of cities don't have both," he said, referring to large and small companies. "They either have one or the other."
Archer said the boom started in earnest as the economy turned around following the recession, with many companies fleeing high costs in California.
"Large companies were looking for a place to expand," he said. "Startups were looking for a place to start."
The move was easy for small software companies.
"They could pick up their lap top and drive across the hill and be here," he added.
"Our proximity to the Bay Area is always a good thing," Archer said. "We benefit being next to California in so many ways."
In other studies that look at Nevada as a whole, the state doesn't rank very high in technology markers. However the ITIF study provides a closer look at northern Nevada by breaking data down by congressional district.
Archer noted several highlights in the ITIF study that were encouraging: high-tech manufacturing is almost double the national average; and both the number of patent applications from the area and availability of broadband is equal to or better than the national average as well as comparable congressional districts.
Archer believes if the data looked just at northwestern Nevada, the region would look even better since technology is slower to move into the vast rural areas of the state.
The study also shows room for improvement.
"Clearly, the number of STEM workers can be improved," Archer said, referring to the science, technology, engineering and mathematical employees that technology companies require. "It's a chicken-and-egg thing. We need to convince people they need a STEM education, and the education system needs to prove jobs are there and convince people to take the classes."
Progress is being made.
Companies like Switch and Tesla "wouldn't be moving here if they didn't feel we had sufficient number of STEM workers."
Doug Erwin, vice president of entrepreneurial development for the Economic Development Authority of Western Nevada (EDAWN), spends a large part of his working hours helping the region's technology companies grow as well as attracting new companies.
Most companies use some kind of technology, he said, but to be considered a technology company, the principal product must be software or hardware.
By that definition, Tesla's Gigafactory is a manufacturing facility rather than technology facility, even though what they manufacture is highly technical, he said.
"When we look at technology companies that we want to move here, we look upstream to the development side and those doing quality testing."
The higher the level of technology, the higher the level of infrastructure that's needed, something EDAWN and other community organizations are also working toward improving.
"We've got a good foundation for technology," Erwin said. "We're definitely not there yet."
Erwin also emphasizes the need for educational programs to grow technology.
Truckee Meadows Community College "has done a great job of adapting their programs to support what Tesla needs. But what does that adaptation look like if we bring in a software company like CAEK?" he said, referring to the company that moved from Arkansas to Reno last year.
Ira Gostin, owner of 120 West Strategic Communications, has worked for and represented many tech companies. He's excited to see the technology changes in the region.
"In five years, I think we'll catch up with this infrastructure," Gostin said.
"Twenty-five years ago, gaming was it," he said. "Gaming is still important but in terms of job creation, it's not growing. We haven't seen any new casinos, except maybe one" (the proposed Station Casino).
As an example of the change, Gostin cited his stepson, who just started at University of Nevada, Reno.
"When he graduates, the jobs available to him will be very different than what was available 20 years ago."
However, students need more information to chose STEM fields.
"There is a disconnect between jobs that are available and what the workforce is looking for," Gostin said. "People need a little help bridging that gap."
Students need to understand they can gain a skill set from a specific class that will qualify them for a specific job.
Change is well on the way.
It's becoming common to hear the Reno area called the new Silicon Valley.
Gostin said it's more like the Brooklyn of the West, with a trendy "foody" environment and recreation that's attractive to tech companies.
"We're starting to see that on a Reno-sized scale," he said.
Gostin also sees the flight from California as a contributor to Reno's technology growth.
A company in California wants to grow, but because of the cost of living, its employees are commuting an hour or two every day, he said.
"You can move them to Reno, give everyone a 10 percent raise, (they can enjoy the area's) recreation and all there is to do here, and still cut costs."
So that company moves, and another company moves and they both talk to their friends.
"I see this continuing. …
"This is the time to start a business here," Gostin said. "The exciting story will be when we get the (ITIF) report again" and see the change in the data for northwestern Nevada.