Computer Systems Design IndustryFebruary 22, 2018 The private-sector computer systems design industry was hit hard by the recession – no, not the Great Recession, the one before it. Remember the high-tech recession of 2001? Oregon’s computer system design industry shed more than 3,000 jobs from 2001 to 2003, nearly 30 percent of its workforce. Some of the job losses were due to the loss of entire firms; the number of business units in the industry fell from 1,437 in 2001 to 1,283 in 2003, a drop of 10 percent.
After the bursting of the tech bubble in 2001, the real need for the industry quickly resumed and growth continued much as it had before the bubble. The average long-run growth of employment in the industry from 1990 through 2017 was 6 percent per year. This is the industry that writes the software that runs computers, designs the integration of software and hardware, and operates data processing facilities, so it is natural that its growth will parallel our increasing use of computers.
The Great Recession, which resulted in Oregon job losses across all industries of 8.5 percent from early 2008 to early 2010, led to only modest job losses in the computer systems design industry. Annual average employment fell by only 100 in 2009 to 9,600 jobs total. Growth resumed in 2010. The industry has added 6,800 jobs since its low point in 2009, an increase of 70 percent to reach a total of 16,400 jobs in 2017.
Further proof that the Great Recession had little effect on the industry is that the number of businesses continued to grow, albeit slowly, during the recession. Computer systems design businesses with employees numbered 1,773 in 2007. This number has grown almost every year and in 2016 there were 2,554 firms with employees in the industry.
The industry’s growth is reflected in the wages it offers. The computer systems design industry paid an annual average wage of $103,187 in Oregon in 2016, although this was down ever so slightly from 2015. Its total payroll was more than $1.6 billion. Wage growth in the industry has also been better than average, 4 percent a year on average since 2009 versus 3 percent for all private industries combined.
This growth is expected to continue. A forecast by the Oregon Employment Department predicts that the industry will add 5,700 jobs from 2014 to 2024 and end up with a total of 19,900 in the final year. That is growth of 40 percent over 10 years, much faster than the expected employment growth of 14 percent for all industries combined in Oregon.
Although there were more than 2,500 firms in the computer systems design industry in 2016, most are quite small. Only 1,033 of these firms had more than one employee on an annual average basis. Just 214 firms had 10 or more employees, and the largest 1 percent of firms had 43 percent of the total employment.
The different parts of the industry tend to favor somewhat different-sized firms. The broad computer systems design industry actually contains four specific industries: custom computer programming, computer systems design services, computer facilities management, and other related computer services. The custom computer programming industry is dominated by small firms. About two-thirds had no more than one employee in 2016, and only 7 percent had 10 or more employees. The firms in the catch-all other computer related services industry also tended to be small, like the custom programming firms. Only 8 percent had 10 or more employees.
The computer system design services specific industry had more of the larger firms, and the computer facilities management industry had the largest share of the bigger firms. Twenty-eight percent of the firms in computer facilities management had 10 or more employees in 2016; only 36 percent had one employee or less on an annual average basis. These two specific industries also had the four largest firms in the overall industry.
It appears that some firms in the broad industry are actually the information technology sections of businesses that are primarily in other industries. For example, a large health care provider might have its IT section organized as a stand-alone unit that is included in this broad computer-related industry.
The wages paid in 2016 by the four specific industries in the private sector were all higher than average. The computer systems design services firms paid an annual average wage of $107,888; the custom programming firms paid $101,224; the computer facilities management firms paid $94,288; and the other computer related services firms paid $82,622. This last group is more likely to offer services other than programming, and so may have a different occupational mix than the other three industries.
The computer systems design industry is dominated, not surprisingly, by people working in computer occupations. Computer occupations account for about 60 percent of the industry’s employment. An estimated 113 different occupations worked in the industry in Oregon in 2014. Software developers for applications was the single most common occupation working in the industry, followed by web developers.
How important are job titles in the industry? Not very, according to software engineer Kevin Johnsrude of Corvallis. “When hiring someone, people in the industry are more interested in what you have done and can do,” Johnsrude stated, “and less interested in what your last job title was.” Although job titles are often not standard across different firms in the industry, there is a tendency to use the terms “developer” and “engineer” to denote more responsibility and independence and the terms “programmer” and “coder” for people who require more direction. Johnsrude also noted that a person’s formal education wasn’t as important as the skills they had acquired.
Although computer occupations are by far the most common ones in the industry, there are other types of jobs, of course. Management occupations accounted for 12 percent of the industry’s employment in 2014, finance and office occupations each comprised 7 percent, and sales and design occupations each made up 5 percent of the industry employment.
What is it like working in the computer systems design industry? Johnsrude stated that there are pluses and challenges. “It is a great opportunity to invent and create,” he said. On the other hand, the work culture varies greatly among firms. People who are drawn to computer programming may create a work culture that is considerably different from a typical office environment. Another issue is turnover and the difficulty of retaining talented staff.
Overall though, Johnsrude emphasized the opportunities that the industry offers. Although many developers have four-year college degrees, it is possible to get into the industry with community college courses or even just online training. Many university students start their careers with one or two internships. Most new developers work closely with mentors for their first year on the job. Working at a startup business or starting your own business is also common for people starting out. The website stackoverflow.com provides survey results that give insight into software development professionals and their skills.
Software development requires lifelong learning of new technologies. The constant innovation in computers and software drives the industry to be open, flexible, and adaptable. It provides a great opportunity for workers with the same qualities.