Each year, The Mass Technology Leadership Council (MassTLC) assesses the technology market’s impact on the New England economy. Based on the findings and the group’s ongoing work in support of the region’s tech industry, MassTLC is uniquely qualified to speak to the vibrancy of the innovation economy.
We asked Tom Hopcroft, MassTLC’s president and CEO, about the Massachusetts tech economy, how it compares to Silicon Valley and the contributions the technology industry makes to the New England region.
1) Highwire PR has been talking about the infamous west-coast vs. east-coast debate. What’s your assessment of the differences and similarities in the start-up environment when you look at New England and Silicon Valley?
The tech hubs in Silicon Valley and New England each have unique identities, but, as head of the Massachusetts Technology Leadership Council, I can best speak to our local tech economy.
The first point I’d make is that Massachusetts is experiencing a tech renaissance. In the four years following the 2008-09 recession, we saw about 5,000 tech jobs added each year. Two years ago we added 8,000 and last year it was up to 9,000. Job growth is perhaps the most tangible indicator of a vibrant and growing economy but there are others.
Over this same period, for instance, a revitalized start-up ecosystem came together with the creation of the Boston Innovation District and others across the state; the creation of many start-up accelerators — most notably MassChallenge and Greentown Labs; and the growth of corporate research centers, university labs and public-private partnerships.
The makeup of our tech economy is another key attribute and differentiator for our region. We have a very healthy and diverse mix of consumer, industrial, digital and physical (e.g., IoT, robotics) technologies being developed for many verticals including health, finance, education, and government. Their close proximity to each other and to the academic and traditional industries creates a strong “bump factor” that leads to innovations at the boundaries between disciplines.
As such, Massachusetts has a unique strength and leadership opportunity in what is often called the Fourth Industrial Era, or Third Wave, depending on whom you ask. It is characterized by the instrumentation and automation of the physical world — bringing the offline world online, creating an Internet of Things and then overlaying digital information back into the physical world with augmented reality, 3-D printing and other new technologies.
Our leadership here is built upon our four decades of “data DNA” — from the structured mainframe and minicomputer days to the unstructured big data of recent years and today’s artificial intelligence and machine learning. Not to mention “things,” where our leadership is evidenced by the fact that the very terms “robot” and the “Internet of Things” were coined here.
In fact, companies like Amazon Robotics (formerly Kiva Systems), Venca Technologies, and GE moved to Massachusetts from California, D.C. and Connecticut, respectively, specifically for the innovation capacity and talent — a blend of software and hardware engineering — that our region has to offer.
2) In reading the recent reports MassTLC has issued, it seems as though the tech industries do not get as much credit as they deserve for their contributions to the New England economy. What are your thoughts on what the reports tell us?
The tech sector in Massachusetts directly employs 300,000 people and there are another 100,000 tech jobs outside the sector in healthcare, finance, retail, bio, etc. Add in the jobs servicing the companies (e.g., PR, accounting, legal, etc.) and those that service the employees (e.g., dry cleaners, coffee shops, restaurants, etc.) and you add close to 800,000 more jobs. In total, tech is responsible for about 34 percent of the job base in Massachusetts. And because they pay better than average, tech underpins about 44 percent of payroll in the state and 34 percent of gross state product.
While we are not as visible in the media, company leaders recognize the strength of what’s going on here. It’s why so many are moving or opening offices here. In fact, Eric Schmidt, speaking at MIT in the beginning of May 2017, remarked that “Silicon Valley needs a competitor” and that “the obvious competitor is the Boston-Cambridge area.” With GE’s recent relocation of their corporate headquarters, and many others, we see validation.
3) Having mapped the current New England technology markets for some time, what areas do you see as being the most promising?
The big opportunity is around the digital-physical convergence I mentioned earlier.
Other areas of strength and opportunity that come to mind include cybersecurity, artificial intelligence and consumer tech. People don’t think of us as a consumer-tech town, but we have quite the cluster with leading brands like TripAdvisor, Wayfair, Care.com, iRobot, Draft Kings, Rue La La and more. So, if you’re looking to work at or with a consumer tech company, there are some great opportunities to check out locally before you venture to other regions.
4) If you had advice for a young or growing technology company in New England, what would it be?
Get plugged into the local tech economy. Join groups like MassTLC and get involved. I like to say that membership is like a health club; you get out of it what you put in. And, it’s really true. By plugging into the tech ecosystem through us or otherwise, you will extend your ability to network and get wherever it is you are going a whole lot faster.