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ww w. t e c h n o l o g y c o u n c i l s . o r g 
2014 National Survey 
of Technology, Policy 
and Strategic Issues 
© 20...
About TECNA | CompTIA | TechAmerica 
About TECNA 
The Technology Councils of North America (TECNA) represents almost 50+ I...
About This Research 
The data for this quantitative study was collected via an online survey conducted during October 2014...
Profile of Survey Respondents 
Industry Sector Number of Employees 
23% Less than 10 
9% 10 to 19 
14% 20 to 49 
11% 50 to...
Geographic Segmentation Categories 
This report contains a number comparisons among geographic regions. The 
following gro...
Key Findings 
- The 2014 TECNA National Survey of Technology, Policy and Strategic Issues reveals positives on a number of...
Key Findings Continued 
- As noted previously, shortages of talent, labor inflation and employee churn rank as top concern...
Section 1 
Assessment 
of Business 
Conditions 
and the 
Economy
Business Sentiment Continues to Trend Upward 
46.3 46.3 
62.1 
66.4 
50.8 
56.4 
66.0 
68.8 
54.6 
63.2 
71.9 72.2 
Global...
53.0 
61.5 
69.6 69.9 
55.4 
63.3 
72.9 72.9 
55.4 
64.4 
72.4 71.7 
54.0 
62.8 
72.1 
73.7 
Global 
Economy… 
U.S. 
Econo...
Business Sentiment Regional Trending 
U.S. Economy Rating Tech Sector Rating 
2012 2013 2014 2012 2013 2014 
Northeast 46....
53.4 
61.3 
70.8 
67.7 
55 
63.2 
71.1 72.2 
55.9 
65.1 
74.5 75.9 
54.4 
63.7 
72.1 73.6 
Global 
Economy… 
U.S. 
Economy...
6-Month Outlook Generally Favorable 
Global 
Economy 
U.S. 
Economy 
Tech 
Sector 
Company Self- 
Assessment 
22% 
52% 
25...
21% 
42% 
46% 
64% 
25% 
38% 
46% 
58% 
23% 
44% 
48% 
67% 
21% 
40% 
50% 
68% 
Global 
Economy… 
U.S. 
Economy… 
Tech 
Se...
21% 
41% 
49% 
70% 
24% 
41% 
48% 
70% 
21% 
40% 
46% 
64% 
22% 
42% 
45% 
54% 
Global 
Economy… 
U.S. 
Economy… 
Tech 
Se...
% Expecting Improvement % Expecting No Change or Weakening 
IT Services Firms Enterprise Software Firms Telecom/ISP/Cloud ...
Section 2 
Business 
Investment 
Drivers and 
Factors that 
Could Slow 
Growth
Business Investment Expectations 
3% 
4% 
5% 
5% 
5% 
6% 
4% 
8% 
5% 
58% 
71% 
35% 
43% 
44% 
44% 
46% 
51% 
39% 
34% 
24...
Business Investment Expectations Trending 
27% 
33% 
42% 
41% 
51% 
53% 
51% 
52% 
47% 
51% 
62% 
59% 
59% 
57% 
23% 
32% ...
Business Investment Segmentation 
Percent indicating a planned increase in investment over next 6 months 
Planned Increase...
Executives Express a Range of Concerns Over 
Factors that Could Slow Business Activity 
4% 
5% 
5% 
4% 
12% 
12% 
13% 
22%...
Growth Inhibitors Segmentation 
Percent indicating a planned INCREASE in investment over next 6 months 
Planned Increase N...
Section 3 
Workforce 
Issues
Perceptions of Tech Talent Availability [Quantity] 
2% 
9% 
14% 
44% 
25% 
1% 
7% 
12% 
49% 
27% 
Significant 
surplus 
Mo...
Perceptions of Tech Talent Quality 
Perceptions of quantity and quality of tech talent in respondents’ state/region | qual...
Perceptions of Tech Talent Availability Segmentation 
Perceptions of quantity and quality of tech talent in respondents’ s...
Perceptions of Tech Talent Availability Segmentation 
NET 
shortage 
Enterprise Software firms 49% 
84% 
51% 
45% 
54% 
57...
Workforce Gains / Losses Projections 
17% 
5% 
5% 
8% 
Timeframe: over next 12 months 
31% 
63% 
16% 
7% 
34% 
63% 
Hiring...
Workforce Gains / Losses Projections Segmentation 
4% 2% 
10% 
57% 
6% 4% 
33% 
74% 
7% 6% 
44% 
66% 
11% 10% 
51% 52% Mic...
Workforce Gains / Losses Projections Segmentation 
6% 5% 
33% 
60% 
10% 
6% 
36% 
58% 
8% 7% 
34% 
64% 
4% 3% 
34% 
66% 
N...
Section 4 
Public Policy 
Issues
Rating of How Well Government Represents 
the Interests of the Tech Sector 
Rating of Federal Government Rating of State/L...
Rating of How Well State/Regional Government 
Represents the Interests of the Tech Sector 
41% 
43% 
16% 
43% 43% 
14% 
48...
Preferences for Policy Actions in 2015 
10% 
14% 
19% 
21% 
18% 
15% 
26% 
25% 
25% 
26% 
25% 
20% 
24% 
37% 
44% 
46% 
41...
Perceptions of Most Negative Aspects of Tax Policies 
12% 
3% 
9% 
17% 
22% 
33% 
16% 
5% 
10% 
15% 
28% 
26% 
Tax code co...
Perceptions of Most Negative Aspects of 
Tax Policies Segmentation 
Planned Increase Northeast Midwest South West 
Tax cod...
Self Assessment of Desirability of 
Local Area/Region for Tech Startups 
20% 
41% 
36% 
16% 
54% 
28% 
9% 
45% 
42% 
9% 
4...
Self Assessment of Desirability of 
Local Area/Region for Tech Startups 
30% 
63% 
4% 
30% 
62% 
3% 
32% 
58% 
6% 
36% 
54...
% of Executives Believing the Tech Sector in Their 
Region Under-performs Its Potential 
63% 
58% 
62% 
58% 
69% 
70% 
54%...
Perceptions of Factors Contributing to a 
Healthy Tech Sector in Region 
6% 
4% 
0% 
0% 
11% 
9% 
10% 
15% 
0% 
35% 
27% 
...
Perceptions of Factors Contributing to a 
Healthy Tech Sector Segmentation 
Planned Increase Northeast Midwest South West ...
Perceptions of Factors that can Inhibit 
Tech Sector Growth / Performance 
8% 
13% 
11% 
11% 
11% 
12% 
17% 
0 
27% 
26% 
...
Expectations of Sectors’ Ability to Drive 
Innovation / Startups / Job Growth 
3% 
3% 
2% 
2% 
2% 
3% 
1% 
4% 
1% 
8% 
8% ...
2014 TECNA National Survey of Techncology, Policy & Strategic Issues
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2014 TECNA National Survey of Techncology, Policy & Strategic Issues

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This third annual survey by TECNA, a non-profit trade association of regional technology organizations which serves as a leading voice in growing the North American technology economy, provides current and future technology trends locally, regionally and nationally. The survey was conducted in partnership with CompTIA, the non-profit association for the IT industry.

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2014 TECNA National Survey of Techncology, Policy & Strategic Issues

  1. 1. ww w. t e c h n o l o g y c o u n c i l s . o r g 2014 National Survey of Technology, Policy and Strategic Issues © 2014 Technology Councils of North America. All rights reserved.
  2. 2. About TECNA | CompTIA | TechAmerica About TECNA The Technology Councils of North America (TECNA) represents almost 50+ IT and Technology trade organizations who, in turn, represent more than 22,000 technology-related companies in North America. TECNA serves its members and the industry through its strong peer-to-peer network and its regional initiatives to raise the visibility and viability of the technology industry. About CompTIA CompTIA is the voice of the world’s information technology (IT) industry. Its members are the companies at the forefront of innovation; and the professionals responsible for maximizing the benefits organizations receive from their investments in technology. CompTIA is dedicated to advancing industry growth through its educational programs, market research, networking events, professional certifications, and public policy advocacy. TechAmerica is the public sector and public policy department of CompTIA, advocating before decision-makers at the state, federal and international levels of government. Representing technology companies of all sizes, TechAmerica is committed to expanding market opportunities and driving the competitiveness of the U.S. technology industry around the world.
  3. 3. About This Research The data for this quantitative study was collected via an online survey conducted during October 2014. A total of 1,561 senior (C-level) U.S. IT and business executives belonging to one of the regional technology associations affiliated with the Technology Councils of North America (TECNA) participated in the survey. The margin of sampling error at the 95% confidence level for the overall results is +/- 2.53 percentage points. Sampling error is larger for subgroups of the data, such as region or company size. As with any survey, sampling error is only one source of possible error. While non-sampling error cannot be accurately calculated, precautionary steps were taken in all phases of the survey design, collection and processing of the data to minimize its influence. The study was conducted in conjunction with the Computing Technology Industry Association (CompTIA), with data collection support from Decipher, Inc. CompTIA is a member of the Market Research Association (MRA) and adheres to its guidelines for research best practices and ethics. Any questions about the research methodology or data collection can be directed to research@comptia.org. For questions or issues related to TECNA, contact TECNA’s executive director Bob Moore, bmoore@tecna.org.
  4. 4. Profile of Survey Respondents Industry Sector Number of Employees 23% Less than 10 9% 10 to 19 14% 20 to 49 11% 50 to 99 17% 100 to 499 5% 500 to 999 22% 1,000 or more employees Job Level 43% CEO, President, Owner, etc. 30% Executive - CIO, CTO, CFO, CMO, COO, VP or equivalent 19% Management – Director, Team Leader or equivalent 3% Consultant 3% Other 20% IT services / Solution providers 12% Enterprise Software 11% Consulting 7% Healthcare / Life sciences 5% Finance 4% Digital media / E-commerce 4% Cloud service provider 4% Telecommunications services / ISP 3% Hardware / OEM 2% Data / Analytics 2% Advanced manufacturing 2% Social / Web 2% Energy technology / Cleantech 1% Mobile apps 1% Semiconductor 21% Other
  5. 5. Geographic Segmentation Categories This report contains a number comparisons among geographic regions. The following groupings are based on standard U.S. Census Bureau categorizations. Northeast (n=277)  Connecticut Technology Council (CTC)  Greater Philadelphia Alliance for Capital & Technologies (PACT)  Massachusetts Technology Leadership Council (MLTC)  New Hampshire High Tech Council (NHHTC)  New York Technology Council (NYTECH)  Tech Collective (Rhode Island) Midwest (n=346)  Illinois Technology Association (ITA)  Minnesota High Tech Association (MHTA)  Northeast Ohio Software Association (NEOSA)  Technology Association of Nebraska  Technology Council of Greater Kansas City (KCNext) South (n=538)  Austin Technology Council (ATC)  Council for Entrepreneurial Development (CED)  Chattanooga Technology Council  Chesapeake Regional Tech Council (CRTC)  Howard Tech Council  Metroplex Technology Business Council (MTBC)  Nashville Technology Council  North Carolina Technology Association (NCTA)  Roanoke-Blacksburg Technology Council  Tampa Bay Technology Forum (TBTF)  Technology Association of Georgia (TAG)  Technology Association of Louisville Kentucky (TALK)  Tech Birmingham West (n=400)  Arizona Technology Council (ATC)  California Technology Council  Colorado Technology Association  Idaho Technology Council (ITC)  New Mexico Technology Council  Technology Association of Oregon (TAO)  Utah Technology Council (UTC)  Washington Technology Industry Association (WTIA)
  6. 6. Key Findings - The 2014 TECNA National Survey of Technology, Policy and Strategic Issues reveals positives on a number of fronts. Measures of business sentiment improved across-the-board, continuing the upward sloping trend since 2012. The rating of the overall U.S. economy increased the most year-over-year (6.8 percentage points), significantly closing the gap with the tech sector, which continues to out-perform. The rating of the tech sector improved 5.9 points to 71.9 on a 100-point scale. The self-assessment portion of the business sentiment rating improved a modest 3.4 points to 72.2, but overall, executives express the most confidence in their own company’s position. At a macro regional level, few differences in the ratings exist, although differences do emerge at the individual state level. For the tech sector rating, the Midwest region experienced the most improvement, jumping from most bearish in 2012 to most bullish in 2014. - Looking ahead over the next two quarters, 41% of executives expect further improvement in the U.S. economy. In contrast, only 22% project a strengthening global economy. A slightly greater number (25%) actually expect the global economy to deteriorate over this period. This likely reflects concerns over the continued sluggishness in the Euro Area, some slowing in key emerging markets and the general uncertainty of international conflicts. Nearly half of respondents expect improvement in the tech sector, while a nearly equal number expects the sector to maintain its position. With many sectors of national and global economies moving in lock-step, out-performing the mean, which has been the case with the tech sector the past few years, is especially notable. Interestingly, the smallest of companies in this study – those in the under 10 employee range and those in the 10-99 range, have slightly more positive outlooks than larger firms. This may be a function of smaller firms operating primarily regionally versus larger firms that may be more reliant on overseas revenue streams and therefore more exposed to any softening in the global economy. - Positive business sentiment is often a useful directional guide because of the actions it may foretell. For example, consistent with the improvements in the sentiment measures, approximately 6 in 10 executives plan to increase their investments in new products or business lines at their company. Additionally, 52% plan to spend more on technology and 34% plan to make general capital expenditures. Business travel is an oft-used proxy for business health. Fifty-one percent of TECNA executives, up from 37% in 2013, expect to increase their level of business travel, suggesting more customer visits, meetings, trips to conferences and related. - While sentiment is generally positive, executives recognize the many factors that can quickly derail growth. Topping the list this year is the concern over the umbrella category of talent shortages, labor prices and employee churn. Concern jumped 13 points from 34% in 2013 to 47% in 2014. In an industry marked by disruption and commoditization, downward pressure on pricing and lower margins are perennial concerns. Thirty-eight percent of executives rated that as a key concern. On a positive note, the data suggests an improving landscape for access to credit and capital. Concern fell from 36% in 2012, to 29% in 2013 and 23% in 2014. Of course, access to credit and capital is heavily dependent on company size and very small firms continue to face challenges in this area.
  7. 7. Key Findings Continued - As noted previously, shortages of talent, labor inflation and employee churn rank as top concerns among tech sector executives. To further quantify this concern, a NET 74% indicates there is a significant or moderate shortage in the quality of workers in their state or region. A near equal number – 76%, indicates there is a quantity shortage. Relatively few believe the labor market in the tech sector is in equilibrium, meaning the supply of labor roughly equals demand. Executives in the West region rate the shortage as most severe, while executives in the Northeast relatively less so. - With an unemployment rate well under the national rate, computer, software and related tech jobs have experienced strong demand over the past few years. The tech sector, as the largest employer of these positions, will likely keep the momentum going. According to the TECNA study, 63% of executives report a planned increase in headcount due to newly created positions. Another 34% are in the process of back-filling openings for existing positions. Both rates are on par with 2013. A NET 15% of executives expect layoffs, stemming from either the permanent elimination of certain positions or layoffs associated with weak sales or business cycle issues. Small (10-99 employees) and medium-size (100-499) companies voice the strongest commitment to expanding their workforces as a result of expansion and newly created positions. In contrast, large companies are most likely to be in a position of back-filling openings. The TECNA research highlights the predicament many companies find themselves in: demand for labor (aka job openings) not aligned with the supply for labor (aka pool of qualified candidates). The study did not go into detail on the specifics on the positions where the disconnect is greatest, but generally, it parallels innovation and growth areas: cybersecurity, cloud, big data, mobility, business process automation and so forth. - Public policy and technology increasingly intersect. As technology affects more areas of the economy on more levels, touch points with the policy arena become inescapable. Moreover, the pace of innovation continues to accelerate, widening the gap between the deployment of technology and the rate at which policies and regulations can keep up. At a Federal level, TECNA executives see few positives. Only 15% (net) rate the Federal government as doing a good job in supporting the interests of the tech sector. State and local governments fair slightly better, with 37% rating their performance as it relates to supporting the tech sector as well or very well. It is unclear from the results if the ratings reflect disappointment over specific actions or inactions, or if it is more a general expression of frustration over gridlock and dysfunction. Another contributing factor may be the belief held by many TECNA executives that their region is under-performing its potential. Executives may see opportunities to grow the tech sector in their region, contingent on a coordinated policy effort to overcome hurdles such as workforce issues, regulatory uncertainty, tax code complexity, or infrastructure inadequacies. - The sectors TECNA executives expect to drive growth in the short-term include: software/apps, life sciences/healthcare tech, data/analytics, IT services and cloud computing/data center. Although relatively low in the ratings, the growth driver with the largest percent change over the next two years is energy technology/cleantech.
  8. 8. Section 1 Assessment of Business Conditions and the Economy
  9. 9. Business Sentiment Continues to Trend Upward 46.3 46.3 62.1 66.4 50.8 56.4 66.0 68.8 54.6 63.2 71.9 72.2 Global Economy Rating U.S. Economy Rating Tech Sector Rating Company Self- Assessment Rating 2012 2013 2014 Source: TECNA Base: 1,561 senior U.S. technology and business executives Rating on a 100-point scale
  10. 10. 53.0 61.5 69.6 69.9 55.4 63.3 72.9 72.9 55.4 64.4 72.4 71.7 54.0 62.8 72.1 73.7 Global Economy… U.S. Economy… Tech Sector… Company Self- Assessment… Northeast Midwest South West Business Sentiment Segmentation: Regional Ratings Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=277, Midwest=346, South=538, West=400
  11. 11. Business Sentiment Regional Trending U.S. Economy Rating Tech Sector Rating 2012 2013 2014 2012 2013 2014 Northeast 46.0 54.1 61.5 64.1 63.6 69.6 Midwest 46.9 57.8 63.3 65.2 65.6 72.9 South 46.7 58.2 64.4 65.9 67.4 72.4 West 45.6 56.2 62.8 63.9 67.0 72.1 Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=277, Midwest=346, South=538, West=400
  12. 12. 53.4 61.3 70.8 67.7 55 63.2 71.1 72.2 55.9 65.1 74.5 75.9 54.4 63.7 72.1 73.6 Global Economy… U.S. Economy… Tech Sector… Company Self- Assessment… Micro Firm Small Firm Medium Firm Large Firm Business Sentiment Segmentation: Firm Size Ratings <10 employees 10-99 employees 100-499 employees 500+ employees Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=277, Midwest=346, South=538, West=400
  13. 13. 6-Month Outlook Generally Favorable Global Economy U.S. Economy Tech Sector Company Self- Assessment 22% 52% 25% 41% 48% 11% 47% 49% 4% 65% 33% 3% % Expecting Improvement % Expecting No Change % Expecting Weakening Source: TECNA Base: 1,561 senior U.S. technology and business executives
  14. 14. 21% 42% 46% 64% 25% 38% 46% 58% 23% 44% 48% 67% 21% 40% 50% 68% Global Economy… U.S. Economy… Tech Sector… Company Self- Assessment… Northeast Midwest South West 6-Month Outlook Segmentation: Regional Expectations for Improvement Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=277, Midwest=346, South=538, West=400
  15. 15. 21% 41% 49% 70% 24% 41% 48% 70% 21% 40% 46% 64% 22% 42% 45% 54% Global Economy… U.S. Economy… Tech Sector… Company Self- Assessment… Micro Firm Small Firm Medium Firm Large Firm 6-Month Outlook Segmentation: Firm Size Expectations for Improvement <10 employees 10-99 employees 100-499 employees 500+ employees Source: TECNA Base: 1,561 senior U.S. technology and business executives Micro=352, Small=515, Medium=269, Large=424
  16. 16. % Expecting Improvement % Expecting No Change or Weakening IT Services Firms Enterprise Software Firms Telecom/ISP/Cloud Consulting Firms 63% 27% 63% 37% 70% 30% 53% 47% 65% 35% 58% 42% 6-Month Outlook Segmentation: Expectations for Improvement at Their Company Among Different Types of Tech Firms 71% 29% Digital Media/Apps/Dat a Firms Healthcare/Life sciences Firms OEM/Adv Mfg/Semiconductor Firms Other Firms 72% 28% Source: TECNA Base: 1,561 senior U.S. technology and business executives
  17. 17. Section 2 Business Investment Drivers and Factors that Could Slow Growth
  18. 18. Business Investment Expectations 3% 4% 5% 5% 5% 6% 4% 8% 5% 58% 71% 35% 43% 44% 44% 46% 51% 39% 34% 24% Planning Increases 62% 52% 51% 51% 47% 45% 58% Investments in new products or business lines Staffing levels in technical positions Technology expenditures Marketing/advertising expenditures Business travel Staffing levels in non-technical positions Staff training or professional development Capital expenditures (e.g. non technology) Cost cutting Timeframe: over next 6 months Planning Decreases No Change Expected Source: TECNA Base: 1,561 senior U.S. technology and business executives
  19. 19. Business Investment Expectations Trending 27% 33% 42% 41% 51% 53% 51% 52% 47% 51% 62% 59% 59% 57% 23% 32% 37% 42% 47% 51% 57% 24% 34% 51% 45% 52% 58% Investments in new products or business lines Staffing levels in technical positions Marketing/advertising expenditures Technology expenditures Staffing levels in non-technical positions Staff training or professional development Business travel Capital expenditures (e.g. non technology) Cost cutting 2014 2013 2012 % expecting to increase investment or activity Source: TECNA Base: 1,561 senior U.S. technology and business executives
  20. 20. Business Investment Segmentation Percent indicating a planned increase in investment over next 6 months Planned Increase Northeast Midwest South West Staffing levels in technical positions 54% 58% 59% 58% Investments in new products or business lines 62% 58% 62% 65% Marketing/advertising expenditures 54% 46% 50% 55% Technology expenditures 50% 47% 54% 56% Staffing levels in non-technical positions 49% 42% 47% 52% Planned Increase Micro Firms Small Firms Medium Firms Large Firms Staffing levels in technical positions 47% 67% 67% 49% Investments in new products or business lines 57% 66% 64% 59% Marketing/advertising expenditures 56% 64% 49% 31% Technology expenditures 51% 54% 55% 49% Staffing levels in non-technical positions 40% 60% 55% 33% Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=277, Midwest=346, South=538, West=400
  21. 21. Executives Express a Range of Concerns Over Factors that Could Slow Business Activity 4% 5% 5% 4% 12% 12% 13% 22% 35% 35% 35% 35% 36% 32% 16% 36% 47% 19% 36% 22% 31% 4% 10% 20% 28% 29% 34% 27% 44% 42% 33% 38% 34% 3% 10% 16% 19% 23% 27% 35% 38% 47% Talent shortage/labor prices/employee churn Lower margins/downward pressure on pricing Unexpected shock Domestic competition General lack of confidence/paralysis Government regulation Disruptive technologies or business models Weak corporate demand Access to credit/capital Weak consumer demand Stock market volatility Overseas competition Input/commodity price inflation Weak export market 2014 2013 2012 Source: TECNA Base: 1,561 senior U.S. technology and business executives
  22. 22. Growth Inhibitors Segmentation Percent indicating a planned INCREASE in investment over next 6 months Planned Increase Northeast Midwest South West Talent shortage/employee retention/workforce 42% 50% 45% 50% Lower margins/downward pressure on pricing 36% 36% 40% 37% Government regulation 32% 32% 37% 35% Disruptive technologies/business models 27% 30% 28% 26% Access to credit/capital 27% 15% 22% 27% Planned Increase Micro Firms Small Firms Medium Firms Large Firms Talent shortage/employee retention/workforce 28% 53% 59% 47% Lower margins/downward pressure on pricing 26% 35% 43% 47% Government regulation 33% 30% 30% 43% Disruptive technologies/business models 18% 25% 34% 35% Access to credit/capital 39% 29% 13% 8% Source: TECNA Base: 1,561 senior U.S. technology and business executives
  23. 23. Section 3 Workforce Issues
  24. 24. Perceptions of Tech Talent Availability [Quantity] 2% 9% 14% 44% 25% 1% 7% 12% 49% 27% Significant surplus Moderate surplus Equilibrium, supply roughly equals demand Moderate shortage Significant shortage 2013 2014 NET shortage in talent quantity in 2014 = 76% NET surplus or equilibrium in 2014 = 20% Perceptions of quantity and quality of tech talent in respondents’ state/region Note: don’t know responses not shown Source: TECNA Base: 1,521 senior U.S. technology and business executives
  25. 25. Perceptions of Tech Talent Quality Perceptions of quantity and quality of tech talent in respondents’ state/region | quality was not addressed in the 2013 survey 1% 7% 15% 51% 23% Significant surplus Moderate surplus Equilibrium, supply roughly equals demand Moderate shortage Significant shortage NET shortage of quality talent in 2014 = 74% NET surplus or equilibrium in 2014 = 23% Note: don’t know responses not shown Source: TECNA Base: 1,521 senior U.S. technology and business executives
  26. 26. Perceptions of Tech Talent Availability Segmentation Perceptions of quantity and quality of tech talent in respondents’ state/province/region 69% 42% 76% 76% 53% 52% 80% 48% 27% 23% 24% 32% Northeast Midwest South West Perception of a significant shortage Perception of a moderate shortage Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=270, Midwest=339, South=515, West=383
  27. 27. Perceptions of Tech Talent Availability Segmentation NET shortage Enterprise Software firms 49% 84% 51% 45% 54% 57% 50% 43% 47% 23% 15% 20% 34% 25% 20% 33% 33% IT Services firms Consulting firms Digital Media/Apps/Data firms Telecom/ISP/Cloud firms Healthcare/Life sciences firms OEM/Adv Mfg/Semiconductor firms Other types of firms Perception of a significant shortage Perception of a moderate shortage 84% 77% 79% 77% 70% 59% 70% Source: TECNA Base: 1,521 senior U.S. technology and business executives
  28. 28. Workforce Gains / Losses Projections 17% 5% 5% 8% Timeframe: over next 12 months 31% 63% 16% 7% 34% 63% Hiring staff - positions newly created or additional headcount Hiring staff - back-fill openings for existing headcount Laying-off staff - positions that have been permanently eliminated Laying-off staff - positions reduced due to downsizing, slow sales or other business cycle issues None of above - expect no hiring nor layoffs 2014 2013 Source: TECNA Base: 1,521 senior U.S. technology and business executives
  29. 29. Workforce Gains / Losses Projections Segmentation 4% 2% 10% 57% 6% 4% 33% 74% 7% 6% 44% 66% 11% 10% 51% 52% Micro <10 employees Small Firm 10-99 employees Medium Firm 100-499 employees Large Firm 500+ employees Hiring staff - positions newly created or additional headcount Hiring staff - back-fill openings for existing headcount Laying-off staff - positions that have been permanently eliminated Laying-off staff – positions reduced due to downsizing, slow sales or other business cycle issues Source: TECNA Base: 1,561 senior U.S. technology and business executives Micro=340, Small=506, Medium=260, Large=411
  30. 30. Workforce Gains / Losses Projections Segmentation 6% 5% 33% 60% 10% 6% 36% 58% 8% 7% 34% 64% 4% 3% 34% 66% Northeast Midwest South West Hiring staff - positions newly created or additional headcount Hiring staff - back-fill openings for existing headcount Laying-off staff - positions that have been permanently eliminated Laying-off staff – positions reduced due to downsizing, slow sales or other business cycle issues Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=270, Midwest=339, South=515, West=383
  31. 31. Section 4 Public Policy Issues
  32. 32. Rating of How Well Government Represents the Interests of the Tech Sector Rating of Federal Government Rating of State/Local Government 15% 30% 41% 12% 1% 15% 30% 41% 14% 1% Very poorly Poorly Just okay Well Very well 2013 2014 9% 16% 38% 28% 8% 7% 17% 39% 29% 8% Very poorly Poorly Just okay Well Very well 2013 2014 Source: TECNA Base: 1,500 senior U.S. technology and business executives
  33. 33. Rating of How Well State/Regional Government Represents the Interests of the Tech Sector 41% 43% 16% 43% 43% 14% 48% 40% 12% 44% 40% 16% NET poorly Just okay NET well Northeast Midwest South West Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=270, Midwest=339, South=515, West=383
  34. 34. Preferences for Policy Actions in 2015 10% 14% 19% 21% 18% 15% 26% 25% 25% 26% 25% 20% 24% 37% 44% 46% 41% 43% 41% 40% 3% 11% 18% 25% 22% 25% 32% 36% 42% STEM education at higher ed levels STEM education K-12 level Taxation and/or regulation reform Access to capital for tech companies Access to state level funding for innovation Govt. efficiency through the use of technology Increased broadband deployment Promotion of business between public sector and tech companies Tech infrastructure in schools Immigration policy to allow more STEM skilled workers Modernization of telecommunications laws Opportunities for tech transfer to create new tech companies Tech adoption in healthcare in rural and urban areas Access to public data Immigration policy to restrict STEM workers 2014 2013 na Source: TECNA Base: 1,504 senior U.S. technology and business executives
  35. 35. Perceptions of Most Negative Aspects of Tax Policies 12% 3% 9% 17% 22% 33% 16% 5% 10% 15% 28% 26% Tax code complexity and the time and burden required of businesses to manage taxes Corporate tax rates that are generally too high on businesses Too many tax deductions or loopholes for special interests or sophisticated taxpayers Personal tax rates that are generally too high on consumers Tax policy governing the repatriation of overseas profits Don't know / other 2014 2013 Source: TECNA Base: 1,477 senior U.S. technology and business executives
  36. 36. Perceptions of Most Negative Aspects of Tax Policies Segmentation Planned Increase Northeast Midwest South West Tax code complexity and the time and burden 26% 24% 33% 26% required of businesses to manage taxes Too many tax deductions or loopholes for special interests or sophisticated taxpayers 20% 17% 10% 18% Corporate tax rates that are generally too high on businesses 22% 26% 28% 28% Personal tax rates that are generally too high on consumers 11% 7% 10% 10% Tax policy governing the repatriation of overseas profits 4% 7% 4% 3% Planned Increase Micro Firms Small Firms Medium Firms Large Firms Tax code complexity and the time and burden 36% 29% 26% 22% required of businesses to manage taxes Too many tax deductions or loopholes for special interests or sophisticated taxpayers 17% 16% 17% 12% Corporate tax rates that are generally too high on businesses 24% 30% 26% 24% Personal tax rates that are generally too high on consumers 10% 8% 12% 10% Tax policy governing the repatriation of overseas profits 3% 4% 2% 8% Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=259, Midwest=323, South=516, West=379
  37. 37. Self Assessment of Desirability of Local Area/Region for Tech Startups 20% 41% 36% 16% 54% 28% 9% 45% 42% 9% 41% 47% Lower-tier location for tech startups Mid-tier location for tech startups Top-tier location for tech startups Northeast Midwest South West The Midwest’s self-assessment as a top-tier location for tech startups increased 8 percentage points over 2013, the most of any region.
  38. 38. Self Assessment of Desirability of Local Area/Region for Tech Startups 30% 63% 4% 30% 62% 3% 32% 58% 6% 36% 54% 7% Performing at about its potential Under-performing its potential Out-performing its potential Northeast Midwest South West Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=259, Midwest=323, South=516, West=379
  39. 39. % of Executives Believing the Tech Sector in Their Region Under-performs Its Potential 63% 58% 62% 58% 69% 70% 54% 62% Northeast Midwest South West 2014 2013 Source: TECNA Base: 1,561 senior U.S. technology and business executives Northeast=259, Midwest=323, South=516, West=379
  40. 40. Perceptions of Factors Contributing to a Healthy Tech Sector in Region 6% 4% 0% 0% 11% 9% 10% 15% 0% 35% 27% 25% 23% 49% 45% 56% 2% 7% 9% 14% 26% 26% 24% 36% 44% 57% Quality of life Entrepreneurship/innovation ecosystem Skilled workforce Cost advantages Business friendly environment Research universities University alignment with industry needs General infrastructure capacity Early, mid, late-stage financing capacity commercial sector ecosystem Transportation capacity/quality K-12 education Other factors 2014 2013 na na na Source: TECNA Base: 1,481 senior U.S. technology and business executives
  41. 41. Perceptions of Factors Contributing to a Healthy Tech Sector Segmentation Planned Increase Northeast Midwest South West Quality of life 49% 55% 55% 69% Entrepreneurship/innovation ecosystem 45% 42% 41% 50% Skilled workforce 42% 39% 32% 37% Cost advantages 11% 23% 34% 32% Business friendly environment 11% 20% 33% 33% Research universities 37% 20% 30% 19% University alignment with industry needs 29% 25% 28% 17% General infrastructure capacity 11% 20% 14% 13% Early, mid, late-stage financing capacity 18% 8% 6% 9% Commercial sector ecosystem 9% 14% 7% 7% Transportation capacity/quality 10% 12% 5% 3% K-12 education 4% 8% 3% 1%
  42. 42. Perceptions of Factors that can Inhibit Tech Sector Growth / Performance 8% 13% 11% 11% 11% 12% 17% 0 27% 26% 0 28% 33% 36% 34% 44% 4% 10% 14% 17% 21% 26% 31% 38% Early, mid, late stage financing capacity Costs Workforce Transportation capacity / quality K-12 education Business environment University/college alignment with industry needs Entrepreneurship / innovation ecosystem General infrastructure capacity / quality Commercial sector ecosystem Research universities / R&D capacity Quality of life 2014 2013 na na Source: TECNA Base: 1,470 senior U.S. technology and business executives
  43. 43. Expectations of Sectors’ Ability to Drive Innovation / Startups / Job Growth 3% 3% 2% 2% 2% 3% 1% 4% 1% 8% 8% 6% 9% 30% 24% 22% 1% 4% 6% 6% 8% 10% 14% 22% Life sciences or healthcare technology Software / apps Data / analytics Cybersecurity Data center/cloud computing infrastructure IT services Energy technology / Cleantech Advanced manufacturing Broadcasting / Digital media / entertainment technology Telecommunications Defense / military technology Advanced materials 2-Year Outlook Today Source: TECNA Base: 1,441 senior U.S. technology and business executives

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