Region’s high-tech sector showing signs of recovery

Lori Gama-White, founder of DaGama Web Studio, sees resilience in Northern Colorado’s tech sector.

Gama-White’s nearly 10-year-old Web site development business has grown over the past three to four years from the one-woman shop she launched in 1997 to a staff of five.

Despite the crash-and-burn consequences of the dot-com bubble’s burst in 2001, technology’s role in everyday life and in business has continued to grow. So has people’s awareness of it, Gama-White said.

Just a decade ago it was OK to admit you knew nothing about computers, Gama-White noted. “Now people realize they’ve got to embrace technology. It’s here. It’s never going to go away. It’s going to permeate our culture more and more.”

And that fuels demand for businesses like Gama-White’s. An improving economy and easing uncertainty help, as well.

“The pendulum is swinging, as far as the tech sector is concerned,” Gama-White said. People and businesses are embracing the idea that a Web site can be critical to success. “They realize Web sites are valuable marketing tools,” she said. “It’s a valuable tool in their business they have been putting off.”

After losing more than 2,000 tech jobs between 2001 and 2003 and continuing layoffs in 2004, Northern Colorado is showing signs that, as Gama-White’s experience reflects, the sector is recovering.

“I think the region has seen some big wins for the tech sector,´ said Jacob Castillo, vice president, Northern Colorado Economic Development Corp. “Particularly with the growth of Intel in Fort Collins and the introduction of AMD into the Northern Colorado market.”

NCEDC announced in early summer that Advanced Micro Devices would open a 250-job engineering and design center at the Harmony Corporate Center in Fort Collins. “Those jobs range from part-time market analyst to facilities management,” he said.

“We are working with several tech-related companies within the region who are considering significant expansion,” Castillo said. “So, while as a whole, employment in the tech sector is still down from its zenith, we continue to see small gains from some significant companies.”

Startups come knocking

Kathy Kregel, former executive director of the Fort Collins Technology Incubator, said there are signs there of improvement as well.

“There are two indicators, to me, that things are moving in a positive direction,” Kregel said. “One is that existing companies in the program, which there are five, are doing better in terms of revenue. So, they seem to be gaining traction in sales.”

Better sales figures drive improvements in employment, Kregel noted.

“Then, two, I am getting an increased number of interested applicants talking to me.” After a fairly quiet six months in terms of applications, Kregel said interest in joining the incubator has been picking up dramatically. “We have about four interested companies knocking on the door.”

The Fort Collins Technology Incubator provides a nurturing environment for high-tech startup companies. Incubator clients share ideas and services with each other while receiving support, resources and professional business advice through the program.

Statewide, there are signs and predictions pointing to recovery in the tech sector. The Colorado Software and Internet Association predicts the state’s software industry alone will add 1,800 jobs in 2006. Colorado labor department statistics provide some support to that, estimating that the information technology industry will represent the major area of job growth in Colorado into 2012.

According to the annual Cyberstates report released this spring by the American Electronic Association, a nationwide technology trade association, Colorado remains the state with the highest concentration of tech industry workers in the nation. Although the state lost 2,500 tech jobs between 2003 and 2004, the 2006 AEA report said 89 of every 1,000 private sector workers in Colorado is involved in the tech industry. These high-tech workers earn an average of $76,400 per year, 90 percent more than the average private sector worker.

Colorado has the 12th highest employment of tech workers nationwide, with 159,800 high-tech workers employed.

Nationwide the picture is similar. According to the AEA in 2005, high-tech employment in the U.S. totaled 5.6 million. That was up by 61,100 jobs or 1 percent, after declining in 2004 by 44,700 jobs.

Whether or not the recovery of the sector means jobs for displaced tech workers in Northern Colorado remains to be seen, said Lew Wymisner, assistant director of the Larimer County Workforce Center. “That’s the $64K question,” Wymisner said. And the answer depends on who you are.

“It depends on whether you’re on the employer side or the employment side,” Wymisner said. “The tech sector may recover. You may not if you’re on the employment side.”

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