High tech sector

High technology is seen by many as a key engine of economic growth in the province. That’s hardly surprising given the tremendous advances that have occurred in this sector during the last three decades, not just in BC, but throughout the world.

In the early 1980s, the sector was small, and some industries, such as computer systems design services, were virtually non-existent. Most computers were found in businesses, not homes, and they were not in widespread use.

Now, virtually every type of business uses computers and computer-related services, as do most households. Computers and other high tech goods and services are used in everything from cars and airplanes to pulp and paper mills, where they help monitor and control the paper-making process.

BC isn’t Silicon Valley North, but the province’s high tech sector does make a significant contribution to GDP and employment. The expansion of the sector has been an important factor in the continued diversification of BC’s economy away from its dependence on resource extraction and processing and towards other types of activities.

What's included in the high tech sector?

The high tech sector includes both goods- and service-producing industries. High tech manufacturing industries include a wide range of activities ranging from manufacturing pharmaceuticals to computers, communications & other electronic equipment, aerospace products, and medical equipment & supplies.

On the service side, the high tech sector includes software publishers, motion picture & video production and post-production, Internet publishing, telecommunications, data processing, engineering, computer systems design, surveying & mapping, testing laboratories, environmental and other scientific & technical consulting, and research & development activities.

Most of the jobs are in high tech services, which have also accounted for much of the employment growth in the sector

Service industries dominate the high tech sector, providing most (82%) of the jobs. High tech service industries have been the main source of employment growth during the last few years, as the number of jobs in high tech manufacturing has increased only slightly.

What's happened in high tech since 1997?

During the 1980s and 1990s, high tech industries all over the world experienced unprecedented growth, as computers developed into an increasingly indispensable tool for businesses, consumers and governments. However, the rapid growth in some high tech industries came to a halt around the turn of the century.

The early years of this century were difficult ones in high tech industries all over the world. Demand for many of their products began to slow as the market became saturated. The advances in technology and computation speed that had made many computers become rapidly obsolete slowed from the frenetic pace seen earlier. Most people who wanted computers already had them, and the improvements that were being introduced were not so significant that they felt obliged to replace the equipment as quickly as in the past

BC’s high tech sector is playing an increasingly important role in the economy

However the industry has made a comeback and employment in high tech manufacturing has begun to climb after falling earlier in the decade. In high tech services, the number of jobs is increasing, but at a slower pace than in the past.

In terms of GDP, the high tech sector continues to grow faster than the rest of the economy. Its share of GDP has risen to more than 6%, up from less than 4% in 1997. Although there are fewer people employed in high tech industries than in the tourism sector, the high tech sector makes a much bigger contribution to total GDP.

The large, and growing, gap between GDP and employment shares in this sector suggests there have been significant labour productivity gains in high tech industries. Producers of high tech goods as well as services have seen GDP grow considerably faster than employment during the period from 1997 to 2007. The sector’s GDP has more than doubled since 1997, considerably more than the 35% increase in GDP for the economy as a whole.

How many people work in the high tech sector?

In 2007, there were 81,100 people working in the province’s high tech sector. Most of them (82%) were employed in high tech service industries such as information services (33%), telecommunications (17%) or computer services and engineering (15%). Eighteen percent of workers in this sector were employed in high tech manufacturing.

A third of the jobs in the high tech sector are in information services

What’s the outlook for the high tech sector?

After experiencing some challenges early in the decade, and in the current recession, the high tech sector appears to be back on track and it’s likely that the industry will continue to grow during the next few years.