Ohio's Computer Services Industry by rih47632

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									Ohio’s Computer
Services Industry
Ohio's Standing

    60,000 Ohio workers are employed in the computer             Share of Employment
    services industry.

    The American Electronics Association (AeA) annually
    publishes a state-by-state overview of the high-                                                      Software
    technology industry called Cyberstates. Computer                                                     Publishers
    services is one of four major sectors covered by the                                                    5%
    Cyberstates report.
                                                                                                                      Internet Services
                                                   th                                                                       21%
    According to AeA’s 2003 report, Ohio ranks 12 among
    the 50 states in the computer systems design component
    of computer services. This category employs three out of
    four computer services employees and includes both
    systems design and custom programming.

    Ohio ranks 13th in Internet services.
                                                                                     Computer
                                                                                  Systems Design
LexisNexis, perhaps the best known internet-related firm                               74%
located in Ohio, employs 3,100 workers in the Dayton area.
However, LexisNexis is classified as a publishers, not a
computer services firm. Chemical Abstracts Services, which          Source: AeA
employs 1,400 workers in Columbus, is similarly classified.

Industry statistics also exclude computer services operations
that are part of a larger corporate establishment. NCR’s
Teradata division in Dayton is one example.                      Top Employers
Leading Companies
                                                                 Company                    County     Product                     Employ-
Four of the top five largest employers are located within a                                                                          ment
short distance of each other along 1-270 in northwest Franklin
County. AOL, the seventh largest employer, operates a facility   Sterling Commerce          Franklin   Corporate software                 1,000
a few miles to the east.
                                                                 OCLC                       Franklin   Library software                    950
Sterling Commerce, a subsidiary of SBC Communications, is
headquartered in Columbus. Sterling is one of the largest
providers of business integration software. Customers include    Checkfree                  Franklin   Electronic commerce                 800
more than 80 percent of all Fortune 500 corporations.
                                                                 MCI                        Franklin   Internet services                   750
OCLC (Online Computer Library Center) is a membership
cooperative providing computer services to more than 40,000      UGS PLM Solutions          Clermont Systems design                        600
libraries in 80 countries.
                                                                 ALLTEL                     Summit     Telecom software                    500
Checkfree creates software for financial institutions and
retailers that allows them to issue electronic bills or          AOL                        Franklin   Internet services                   500
statements and gives consumers the ability to receive and pay
bills online.

Customers include Bank of America, Wells Fargo, U.S. Bank,
Yahoo, AT&T, Rich's-Macy's, Bloomingdale's, JCPenney, and
Progressive Insurance.

MCI’s Internet backbone division employs 750 workers in
Hilliard in sales, marketing, and customer-service support.

UGS PLM Solutions develops product lifecylcle management
software and provides support services. As an example, UGS
PLM worked with an auto manufacturer to cut the design cycle
times for engines by 50 percent. (UGS’s Milford facility was
formerly known as Structural Dynamics Research.)
Key Trends
Employment

   Employment in computer services grew rapidly
   during the 1990s, but began to decline in early        Employment Trends
   2001.

   The computer systems design sector is the largest
   unit within computer services, accounting for 74                                                                            44.3
   percent of total employment. Because of this
                                                                                                                                      40.4
   sector’s size, it is possible to track employment
   trends back to 1990.
                                                                                                       30.6
   Nationally, computer systems design employment
   grew 231 percent from March 1990 to March 2001,                                  22.7
   peaking at 1.3 million workers. The industry has              18.7
   since declined by 250 thousand workers—about
   19 percent from peak employment.

   State trends followed a similar path with
   employment increasing 166 percent from February
   1990 to February 2001—peaking at 47.4 thousand                                                                                              Series2

                                                                1990                1993               1996                    1999   2002
   workers. Employment declined to 37.8 thousand in
   November 2003.
                                                          Source: Ohio Bureau of Labor Market Information
Employment Projections

   The Ohio Bureau of Labor Market Information
   prepares industry and occupation forecasts
   covering the period from 2000 to 2010.                 Demand for Additional Workers,
   The Bureau’s projections indicate that computer        2000 to 2010
   services will grow by about 40,000 workers—a 62
   percent ten-year growth rate.                               Computer Support
                                                                                                                                             16,040
                                                                  Specialists

   Not all computer professionals work in the                 Computer Software
                                                               Eng, Applications
                                                                                                                       7,460

   computer services industry. Census figures                        Systems
   indicate that only one-third of all computer                    Administrators
                                                                                                                  6,930

   programmers work in this sector—large numbers              Computer Systems
                                                                                                               5,890
                                                                 Analysts
   of programmers also work for financial service and
   insurance companies, retail stores, universities and       Computer Software
                                                                Eng, Systems
                                                                                                       4,180

   government agencies.                                     Computer Specialists,
                                                                                                    3,340
                                                                  Other

   Still, computer skills are the lifeblood of the                   Database
                                                                                                   2,990
                                                                   Administrators
   computer services industry. From a base of
                                                                Network Systems
   100,000 computer professionals in 2000, Ohio                     Analysts
                                                                                               2,400

   employers will need an additional 50,000 workers                 Computer
                                                                                           1,220
   by 2010.                                                        Programmers



   The top seven fastest growing occupations in Ohio      Source: Ohio Bureau of Labor Market Information
   are all in computer-related fields. These seven
   occupations also have high average wages. Two
   other occupations—computer systems analysts
   ($28 per hour) and computer and information
   systems managers ($35 per hour)—are among the
   top 20 fastest growing occupations.
Statewide Investment Trends
                                                                Major Project Announcements
   Computer services employment peaked early in 2001.
                                                                 60
   Announcements involving major projects (new facilities
   or expansions) peaked in 2000; declined in 2001 and                  51
   2002; then rebounded in 2003.                                 50


   Compared to 2002, 2003 saws gains in three categories:        40
   number of projects; new jobs; and capital investment.
   This may signal industry job growth in 2004.
                                                                 30

2003 Project Announcements
                                                                 20
                                                                                         16                            15
   Hyland Software Inc., located near Cleveland, is
                                                                                                           8
   expanding its operations adding 300 new employees             10
   and investing $5.8 million.
                                                                 0                                                                    Series2

   Hyland Software develops enterprise software that offers            2000              2001            2002          2003
   integrated document management capabilities in a
   single, web-enabled application. In addition to
   developing software, the company provides installation
   and training services.                                       Planned Job Creation
   Hyland Software has been named to both the Inc. 500                4,500
                                                                                 4,239
   and the Deloitte & Touche Technology Fast 500.
                                                                      4,000

   Leader Technologies, located near Columbus, recently               3,500
   announced plans to hire 150 new workers.
                                                                      3,000

   Leader Technologies’ main product is Leader2Leader—                2,500
   software that helps businesses communicate with one
   another, their suppliers, and customers. In one interface,         2,000
   workers have access to e-mail, faxes, and application                                         1,385                        1,257
                                                                      1,500
   software.
                                                                                                                720
                                                                      1,000
   Sypherlink Inc, located near Columbus, is planning to
   add 90 workers to boost its operations.                             500

                                                                        -                                                                       Series2

   Sypherlink has developed software that reduces the time                       2000            2001           2002          2003
   and effort required for data-sharing projects.

   Techni Graphic Systems of Wooster is planning to add
   150 jobs after wining a prime contract from the U.S.         Top 5 Major Projects, 2003
   Department of Defense’s National Imagery and Mapping
   Agency.

   The company provides GIS consulting, high-quality data       Company                         County           Product                        Jobs
   conversion, and scanning services to government and
   commercial clients.                                          Hyland Software                 Cuyahoga         Software                          298

   In the fall of 2003, LexisNexis chose Springfield as the     Leader Technologies             Franklin         Software                          153
   location for a 60,000 square foot data and research
   center that could employ up to 80 people.
                                                                Techni Graphic                  Wayne            GIS mapping                       150

                                                                Sypherlink Inc                  Franklin         Software                             90
   LexisNexis provides online content—legal, business,
   and news information. This new facility will provide data    LexisNexis                      Clark            Data center                          80
   storage for the corporate center in Miamisburg, as well
   as space for the research and development of new
                                                                Source: Ohio Department of Development
   products.
                      Establishments in Ohio's Advanced
                      Electronics and Related Industries
                                                      Computer Services
                                                        State Total: 3,798
                                                                                                                                   Lake        Ashtabula
                                    Lucas                                                                                           88            12
   Williams        Fulton            120
       2             6                                Ottawa
                                                         5                                                                       Geauga
                                                                                                                                   50
                                                                                                              Cuyahoga
     Defiance         Henry             Wood            Sandusky          Erie                                  718                             Trumbull
         8              2                35                8               5                  Lorain
                                                                                                56                                                 31
                                                                            Huron                                                Portage
   Paulding                                             Seneca                                                     Summit          41
      0                                                   3                   5                         Medina      266
                  Putnam            Hancock                                                              62                                    Mahoning
                     4                14                                                                                                         51
  Van Wert                                                     Crawford                   Ashland
     2                                          Wyandot                                                  Wayne             Stark
                    Allen                         3               2                          3            19                70                 Columbiana
                     14                                                     Richland                                                               6
                                     Hardin                                    19
                                       4              Marion
 Mercer         Auglaize                                                                               Holmes                        Carroll
   1               4                                   10          Morrow                                 4                            1
                                                                     2                                                                          Jefferson
                               Logan                                                  Knox                         Tuscarawas                       6
                Shelby           2                                                     5                                7
                  7                             Union                                                 Coshocton               Harrison
                                                 10        Delaware                                       3                      0
                                                              92
  Darke                      Champaign
    2         Miami              0                                               Licking                            Guernsey
               12                                                                   35                                 4                  Belmont
                                                           Franklin                                  Muskingum                               5
                               Clark                         667                                         6
        Montgomery              11
           255                                Madison
 Preble                                         7                         Fairfield          Perry                       Noble       Monroe
   2                        Greene                                          38                 0                           0           2
                              96                          Pickaway                                        Morgan
                                            Fayette           5                                             0
                                               1                                 Hocking                             Washington
  Butler        Warren        Clinton                                               5                                    4
   98            84              9                         Ross                                      Athens
                                                            5                    Vinton                12
  Hamilton                                                                         1
    477                              Highland
                                        4                                                             Meigs
                                                           Pike                                        0
              Clermont                                      1             Jackson
                 48                                                          0
                            Brown           Adams                                         Gallia
                              3                             Scioto                         0
                                              1               3
                                                                                                                                   Establishments
                                                                            Lawrence                                                 in County
                                                                               4
                                                                                                                                            0-2
Source: 2001 County Business Paterns,                                                                                                       3 - 10
U.S. Census Bureau, Washington, D.C.                                                                                                        11 - 75
Prepared by: Ohio Department of Development,                                                                                                76 - 500
Office of Strategic Research (March 2004)                                                                                                   501 - 718
                                                                                                                                                     R032604A

								
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