IT job growth stagnant in '01, uncertain in '02

US high-tech industry job growth increased by just 1% last year, an abrupt end to its recent boom. And the forecast for this year is still unsteady, according to the technology industry group AEA.

          US high-tech industry job growth increased by just 1% last year, an abrupt end to its recent boom. And the forecast for this year is still unsteady, according to the technology industry group AEA.

          Hardest hit last year was the electronics manufacturing sector, which lost 65,000 jobs and had a total employment of 1.9 million, the AEA (formerly the American Electronics Association) says in its annual study. Offsetting the manufacturing decline were employment increases in software and computer-related services, up 97,000 to 2.24 million.

          Overall, high-tech employment rose 80,000 last year, to 5.6 million.

          "I think a lot of people were expecting the ultimate decimation of high tech, which didn't occur," says William Archey, president and CEO of the Washington-based AEA.

          But the outlook for this year remains uncertain, and initial optimism in the beginning of this year has slipped, says Archey. That pessimism has been compounded by a downturn in the telecommunications sector, with the unfolding WorldCom accounting scandal only adding to the woes.

          "The telecom sector is a huge millstone around the neck of the economy and certainly high-tech," says Archey.

          The industry was particularly hurt by a 15% decline in exports, from $US223 billion in 2000 to $US189 billion last year.

          Archey says the export decline has affected employment. The AEA and other high-tech trade groups have been urging Congress to give President Bush expanded authority to negotiate trade agreements.

          He also held out hope that the high-tech sector could be aided by an expected rise in federal, state and local spending on improving information security. "The government is going to become a very big customer of this industry," says Archey.

          In an effort to help its 3500 member firms, the AEA has established a database accessible by government officials detailing members' products and services and offering extensive technology details. The database isn't available to the general public.

          Many of AEA's members are small and midsize companies with technologies that could be attractive to the government. But winning government contracts means, at least initially, spending tens of thousands of dollars in preparation work to meet federal and state bidding requirements.

          Contracting hurdles have in the past kept companies from applying. But AEA officials have been meeting with federal and state officials to address the issue. Lorraine Lavet, the group's chief operating officer, says the proposed Homeland Security Department "had the potential" of reducing some of those obstacles.

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