Download - 2013 TECNA National Survey of Technology, Policy & Strategic Issues

National Survey of Technology, Policy and Strategic IssuesOctober, 2013

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© 2013 Technology Councils of North America. All rights reserved.

Research Methodology and Background

About TECNA | CompTIA | TechVoiceAbout TECNAThe Technology Councils of North America (TECNA) represents almost 50 IT and Technology trade organizations who, in turn, represent more than 16,000 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 CompTIACompTIA 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.

About TechVoiceTechVoice is a newly-formed partnership of the Computing Technology Industry Association (CompTIA), the Technology Councils of North America (TECNA), and participating regional technology associations. Collectively, we represent thousands of technology companies across the country employing millions of workers. We are dedicated to empowering and mobilizing the grassroots tech community to impact legislative and regulatory issues important to growth, innovation and job creation.

About This Research

The data for this quantitative study was collected via an online survey conducted during September 2013. A total of 1,763 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. This includes primarily U.S. based Councils, with a smaller degree of participation from Canadian Councils.

The margin of sampling error at the 95% confidence level for the overall results is +/- 2.4 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 Marketing Research Association (MRA) and conforms to its guidelines for survey best practices and research ethics. Any questions about the research methodology or data collection can be directed to [email protected].

Profile of Survey Respondents

Industry Sector Number of Employees

Job Level

47% Information technology (IT) or telecommunications10% Professional services (non IT)5% Financial/Banking/Insurance5% Healthcare/Medical5% Education4% Life sciences4% Advanced manufacturing (non IT sector)3% Media/Publishing/Entertainment2% Environmental or energy technology2% Government (federal, state, local)2% Retail/Wholesale1% AMTUC (Agriculture, Mining, Transportation, Utilities, Construction)1% Hospitality/Food/Beverage1% Advanced materials8% Other industry sector

29% Less than 1011% 10 to 1913% 20 to 499% 50 to 9915% 100 to 4994% 500 to 99918% 1,000 or more employees

52% CEO, President, Owner, etc.24% Executive - CIO, CTO, CFO, CMO, COO, VP or equivalent17% Management – Director, Team Leader or equivalent2% Consultant4% Other

Geographic Segmentation Categories

Northeast (n=460) Connecticut Technology Council (CTC) Greater Philadelphia Alliance for Capital & Technologies (PACT) Massachusetts Technology Leadership Council (MLTC) New Hampshire High Tech Council (NHHTC) New Jersey Tech Council (NJTC) New York Technology Council (NYTECH)

South (n=484) 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) North Carolina Technology Association (NCTA) Tampa Bay Technology Forum (TBTF) Technology Association of Georgia (TAG) Technology Association of Louisville Kentucky (TALK) Tech Birmingham

This report contains a number comparisons among geographic regions. The following groupings are based on standard U.S. Census Bureau categorizations.

Midwest (n=275) Illinois Technology Association (ITA) Minnesota High Tech Association (MHTA) Northeast Ohio Software Association (NEOSA) Technology Council of Greater Kansas City (KCNext) Wisconsin Technology Council

West (n=530) Arizona Technology Council (ATC) Colorado Technology Association Idaho Technology Council (ITC) Technology Association of Oregon (TAO) Utah Technology Council (UTC) Washington Technology Industry Association (WTIA)

Canada (n=NA) Tech South East

Section 1: Assessment of Business Conditions

56.450.8

66 68.8

59.354.6

67.773.2

Current Rating Projected Rating

Source: TECNABase: 1,763 senior U.S. technology and business executives

Business Sentiment Expected to Improve Modestly Over Next Six Months

Rating on a 100-point scale | 100=highest | 0=Lowest

Project Rating = next 6 months

46.3

62.166.4

56.4

66.0 68.8

2012 2013


Business Sentiment Comparison YOYRating on a 100-point scale | 100=highest | 0=Lowest

5449

6467

58

52

6670

5852

6771

5651

67 69

Northeast

Midwest

South

West

Business Sentiment Segmentation: Regional Ratings



Northeast=460, Midwest=275, South=484, West=530

Northeast Midwest South West

57.0 58.2 58.0 59.461.464.3 65.5 64.0

2012

2013

Business Sentiment Segmentation: Regional Ratings YOY

Rating on a 100-point scale | 100=highest | 0=LowestAverage of 3 ratings: U.S. economy + tech sector + individual company rating



5751

6770

5550

6165

5651

66 68

Information Technology Sec-tor

Other Tech Sectors

Other Industry Sectors

Business Sentiment Segmentation: Industry Sector Ratings



IT sector=826, Non-IT tech sectors=184, Other industry sectors=753

5549

64 65

5851

6770

5852

6873

5651

6569

Micro Firm

Small Firm

Medium Firm

Large Firm

Business Sentiment Segmentation: Regional Ratings


<10 employees

10-99 employees

100-499 employees

500+ employees


Micro=516, Small=604, Medium=261, Large=382

Section 2: Business Investment & Workforce

Many Businesses Plan to Increase Investments

Cost cutting

Capital expenditures (e.g. non technology)

Business travel

Staff training or professional development

Staffing levels in non-technical positions

Technology expenditures

Marketing/advertising expenditures

Staffing levels in technical positions

Investments in new products or business lines

7%

9%

11%

5%

7%

5%

6%

4%

4%

70%

59%

52%

53%

46%

44%

43%

39%

37%

23%

32%

37%

42%

47%

51%

51%

57%

59%

Planning Increases

Planning Decreases

No Change Expected

Timeframe: over next 6 months


Cost cutting

Capital expenditures (e.g. non technology)

Business travel

Staff training or professional development





Investments in new products or business lines

27%

33%

41%

42%

51%

52%

53%

57%

59%

23%

32%

37%

42%

47%

51%

51%

57%

59%

20132012

Expected Increases in Investment YOYExpected increased in investment | Timeframe: over next 6 months


Planned Increase Northeast Midwest South West

Staffing levels in technical positions 54% 61% 58% 57%

Investments in new products or business lines 62% 61% 55% 59%

Marketing/advertising expenditures 49% 52% 49% 54%

Technology expenditures 49% 50% 50% 53%

Staffing levels in non-technical positions 44% 51% 46% 47%

Planned Increase Micro Firms Small Firms Medium Firms Large Firms

Staffing levels in technical positions 48% 69% 69% 45%

Investments in new products or business lines 54% 65% 62% 54%

Marketing/advertising expenditures 56% 60% 52% 29%

Technology expenditures 50% 52% 59% 43%

Staffing levels in non-technical positions 43% 56% 58% 29%

Business Investment Segmentation: Region and Company Size Ratings

Percent indicating a planned INCREASE in investment over next 6 months

Micro: <10 employees

Small: 10-99 employees

Medium: 100-499 employees

Large: 500+ employees






Investments in new products_x000d_ or business lines


50%

47%

41%

56%

45%

47%

47%

38%

58%

54%

52%

56%

54%

62%

70%

Information Tech Sector Other Tech Sectors Other Sectors

Business Investment Segmentation: Industry Sector Ratings

Percent indicating a planned increase in investment over next 6 months



Weak export market

Input/commodity price inflation

Overseas competition

Stock market volatility

Weak consumer demand

Disruptive technologies or business models

Access to credit/capital

Domestic competition

Weak corporate demand

Labor prices/availability of talent/employee turnover

Unexpected shock

Lower margins/downward pressure on pricing

Government regulation

General lack of confidence/paralysis

4%

5%

13%

12%

22%

16%

36%

19%

32%

31%

36%

22%

36%

47%

4%

5%

10%

12%

20%

27%

29%

33%

34%

34%

35%

38%

42%

44%

20132012

Executives Express a Range of Concerns that Could Derail Business Activity




General lack of confidence/paralysis 41% 47% 44% 45%

Government regulation 38% 42% 46% 42%

Lower margins/downward pressure on pricing 37% 31% 42% 39%

Labor prices/availability of talent/employee turnover 32% 31% 34% 37%

Access to credit/capital 33% 36% 26% 26%

Micro Firms Small Firms Medium Firms Large Firms

General lack of confidence/paralysis 51% 42% 43% 38%

Government regulation 41% 39% 42% 48%

Lower margins/downward pressure on pricing 23% 37% 51% 50%

Labor prices/availability of talent/employee turnover 26% 37% 46% 33%

Access to credit/capital 44% 33% 16% 13%

Threats to Growth Concerns Segmentation: Region and Company Size Ratings

Percent indicating a planned increase in investment over next 6 months

Micro: <10 employees

Small: 10-99 employees

Medium: 100-499 employees

Large: 500+ employees



Significant surplus

Moderate surplus

Equilibrium, supply roughly equals demand

Moderate shortage

Significant shortage

2%

9%

14%

44%

25%

Perceptions of Tech Talent Availability

NET perception of a shortage = 69%

NET perception

of a surplus = 11%

Perceptions of quantity and quality of tech talent in respondents’ state/province/region



39%48% 45% 44%

28%

24%20%

28%

Perceptions of Tech Talent Availability SegmentationPerceptions of quantity and quality of tech talent in respondents’ state/province/region

67%72%

65%72%

Perception of a significant shortage

Perception of a moderate shortage



Information Technology

Sector

Tech (Non ICT) Other Industry Sector

43% 42% 45%

31%

17%21%

Perceptions of Tech Talent Availability SegmentationPerceptions of quantity and quality of tech talent in respondents’ state/province/region

73%

60%66%

Perception of a significant shortage

Perception of a moderate shortage



Significant surplus

Moderate surplus

Equilibrium, supply roughly equals demand

Moderate shortage

Significant shortage

2%

10%

16%

50%

22%

2%

9%

14%

44%

25%

2013

2012

Perceptions of Tech Talent Availability YOY


None of above - expect no hiring nor layoffs

Laying-off staff - positions reduced due to downsizing,_x000d_ slow sales or other business cycle issues

Laying-off staff - positions that_x000d_ have been permanently eliminated

Hiring staff - back-fill openings_x000d_ for existing headcount

Hiring staff - positions newly_x000d_ created or additional headcount

17%

8%

5%

31%

63%

Workforce Gains / Losses ProjectionsTimeframe: over next 12 months


3% 2%

10%

59%

5%2%

30%

74%

9%7%

46%

72%

16%12%

49% 47%Micro

Small Firm

Medium Firm

Large Firm

Workforce Gains / Losses Projections Segmentation

<10 employees

10-99 employees

100-499 employees

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



Very unlikely

Somewhat unlikely

Neutral / don't know

Somewhat likely

Very likely

31%

12%

23%

19%

15%

Likelihood to Use More Foreign Workers (e.g. H1B Visa) Should They Become Available


NET likely = 34%

NET unlikely = 43%


14%21% 22% 22%

11%

14%21% 20%

Likelihood to Use More Foreign Workers (e.g. H1B Visa) Segmentation

25%

35%

43% 42%

Very likely

Somewhat likely

<10 employees

10-99 employees

100-499 employees

500+ employees



Section 3: Public Policy Issues

9%

16%

38%

28%

8%

15%

30%

41%

12%

1%

State/Regional Government

Federal Government

Rating of How Government Represented the Interests of the Tech Sector

Just Okay

Represented Tech Interests

Very Well


Very Poorly

WellPoor

Timeframe: during past two years


NET Well Just Okay NET Poor

26%

45%

29%31%

35% 34%

40%

36%

24%

45%

36%

20%

Northeast

Midwest

South

West

How State/Regional Government Represented the Interests of the Tech Sector Segmentation




7%

18%

39%

30%

7%9%

16%

38%

28%

8%

2012

2013

Rating of How State/Regional Government Represented the Interests of the Tech Sector YOY

Just Okay


Very Well


Very Poorly

WellPoor


Access to public data

Technology adoption in healthcare in rural and urban areas

Immigration Reform (e.g. foreign STEM skilled workers)

Modernization of telecommunications laws

Increased broadband deployment

Opportunities for tech transfer to create new tech companies

Government efficiency through use of technology

Technology Infrastructure in schools

Promotion of business between public sector & tech sector

Access to state/local grant funding for innovation/startups

Taxation and/or regulation reform

STEM education at the higher ed levels

STEM education at the K-12 level

Access to capital for technology companies

10%

14%

15%

18%

20%

21%

24%

25%

26%

37%

40%

41%

41%

46%

Preferences for Policy Actions


Micro Firms

Small Firms

Medium Firms

Large Firms

Access to capital for technology companies 61% 51% 34% 27%

STEM education at the K-12 level 35% 38% 47% 49%

STEM education at the higher ed levels 31% 38% 53% 50%

Taxation and/or regulation reform 34% 41% 42% 43%

Access to state and local level grant funding for innovation/startups 53% 38% 20% 25%

Promotion of business between public sector & tech companies 26% 30% 22% 22%

Technology Infrastructure in schools 20% 23% 34% 29%

Government efficiency through use of technology 20% 23% 29% 26%

Opportunities for tech transfer to create new tech companies 24% 19% 19% 21%

Increased broadband deployment 20% 22% 16% 21%

Modernization of telecommunications laws 12% 16% 20% 27%

Immigration Reform (e.g. access to foreign STEM skilled workers) 10% 17% 21% 17%

Technology adoption in healthcare in rural and urban areas 13% 13% 16% 15%

Access to public data 12% 10% 7% 9%

Preferences for Policy Actions Segmentation

Don't know

Tax policy governing the repatriation_x000d_ of overseas profits

Personal tax rates that are generally too_x000d_ high on consumers

Too many tax deductions or loopholes for_x000d_ special interests or sophisticated taxpayers

Corporate tax rates that are generally_x000d_ too high on businesses

Tax code complexity and the time and burden_x000d_ required of businesses to manage taxes

12%

3%

9%

17%

22%

33%

Perceptions of Most Negative Aspects of Tax Policies



Tax code complexity and the time and burden required of businesses to manage taxes 37% 30% 35% 31%

Too many tax deductions or loopholes for special interests or sophisticated taxpayers 19% 19% 15% 15%

Corporate tax rates that are generally too high on businesses 19% 26% 23% 22%

Personal tax rates that are generally too high on consumers 8% 10% 8% 10%

Tax policy governing the repatriation of overseas profits 4% 2% 4% 3%

Micro Firms Small Firms Medium Firms Large Firms

Tax code complexity and the time and burden required of businesses to manage taxes 38% 35% 29% 28%

Too many tax deductions or loopholes for special interests or sophisticated taxpayers 20% 16% 12% 17%

Corporate tax rates that are generally too high on businesses 17% 25% 30% 20%

Personal tax rates that are generally too high on consumers 9% 9% 11% 8%

Tax policy governing the repatriation of overseas profits 2% 2% 3% 6%

Tax Code Perceptions Segmentation

Lower-tier location_x000d_ for

tech startups

Mid-tier location_x000d_ for

tech startups

Top tier location_x000d_ for

tech startups

19%

44%

32%

23%

53%

20%

12%

42% 42%

8%

41%

47%

Northeast

Midwest

South

West

Self Assessment of Desirability of Local Area for Tech Startups



24%

69%

2%

23%

70%

4%

29%

62%

4%

32%

58%

6%

Northeast

Midwest

South

West

Most Executives Believe the Tech Sector Is Under-performing Its Potential



Perception of Tech Sector Performance YOY

3%

25%

66%

7%

2012

4%

28%

64%

5%

2013

Believe Tech Sector under-performing its potential

Believe Tech Sector performing at about its potential

Believe Tech Sector out-performing its potential

Don’t know


Transportation capacity / quality

Commercial sector ecosystem

Early, mid and late-stage financing capacity

General infrastructure capacity / quality

Business friendly environment

Cost advantages

Research universities / R&D capacity

Entrepreneurship / innovation ecosystem

Skilled workforce

Quality of life

6%

10%

11%

15%

23%

25%

35%

45%

49%

56%

Perceptions of Factors Contributing to a Healthy Tech Sector in Region



Quality of life 47% 54% 51% 70%

Skilled workforce 52% 50% 45% 49%

Entrepreneurship / innovation ecosystem 42% 41% 40% 55%

Research universities / R&D capacity 47% 41% 38% 21%

Cost advantages 12% 29% 35% 25%

Business friendly environment 14% 19% 28% 28%

General infrastructure capacity / quality 15% 14% 17% 12%

Early, mid and late-stage financing capacity 18% 9% 9% 8%

Commercial sector ecosystem 14% 9% 11% 7%

Transportation capacity / quality 8% 8% 7% 3%

Perceptions of Factors Contributing to a Healthy Tech Sector Segmentation

Quality of life

Commercial sector ecosystem

General infrastructure capacity / quality

Research universities / R&D capacity

Entrepreneurship / innovation ecosystem

Business environment

Transportation capacity/quality

Workforce

Costs basis (inclusive of various business costs)

Early, mid and late-stage financing capacity

8%

11%

11%

12%

17%

26%

28%

34%

36%

44%

Perceptions of Factors that can Inhibit Tech Sector Growth / Performance



Early, mid and late-stage financing capacity 37% 58% 43% 44%

Costs basis (inclusive of various business costs) 62% 28% 24% 28%

Workforce 27% 32% 34% 40%

Transportation capacity / quality 23% 16% 46% 22%

Business environment 27% 31% 21% 25%

Entrepreneurship / innovation ecosystem 16% 25% 20% 11%

Research universities / R&D capacity 10% 10% 8% 18%

General infrastructure capacity / quality 12% 6% 13% 11%

Commercial sector ecosystem 8% 9% 10% 14%

Quality of life 11% 7% 8% 4%

Perceptions of Factors that can Inhibit Tech Sector Growth / Performance Segmentation

Advanced materials

Advanced manufacturing

Broadcasting / media and entertainment technology

Defense / military technology

Environmental or energy technology

Life sciences or healthcare technology

Information technology or telecommunications

2%

6%

4%

3%

12%

38%

35%

1%

5%

5%

5%

7%

34%

44%

Today2-Year Projection

Expectations of Sectors’ Ability to Drive innovation/startups/job growth
