Blog Post

By: Levi Pace

Tech is behind every post we see and every screen we touch. It’s every place we have a digital account. I’m typing this blog while working remotely, periodically checking my smartphone.

To pay for school, I was a learn-as-you-go computer technician at Alice Lloyd College in Eastern Kentucky. Backhoes dug trenches on both sides of Caney Creek for our fiber-optic network, which ran on Novell NetWare. I did IT support for faculty and staff PCs running Windows 95. After work, I prepared class assignments in WordPerfect. I didn’t realize then that Novell and WordPerfect software came to Appalachia from Utah County, 1,800 miles away.

Many organizations have long since run on information technology, from payroll and purchasing to marketing and distribution, even if they don’t deliver content online. Tech companies sell technology services and digital devices that enable other companies and individuals to do what they do.

What Does Tech Look Like in Utah?

Last year, tech companies provided over 118,000 jobs in Utah with average compensation of $106,000, more than 80 percent above the state average outside of tech. Adding in employment they generated in other industries, tech companies supported more than one in seven Utah jobs.

While tech culture comes across as young and hip, the tech sector makes room for people at every phase of their careers. Compared to other occupations, Utahns in tech roles have a similar age profile, but fewer women and people of color.

Tech Goes Way Back

For the second volume of our new tech industry report that will be released later this summer, my coauthor Jim Wood looked into Utah’s history while I analyzed data. Here are a few of the story threads he collected.

In the 1960s, the U.S. Department of Defense awarded grants to establish the country’s first computer science departments at the University of Utah and five other universities. Two early graduate students to come out of the cutting-edge academic setting in Salt Lake City were Alan Ashton and John Warnock.

Ashton later co-founded WordPerfect in Orem with his former student Bruce Bastian. By the early 1990s, their company supplied more than half of the global demand for word processing software. After selling for $2.4 billion (in today’s dollars), Ashton invested in real estate in Lehi. As tech companies flocked there, its population doubled twice in less than 20 years.

Meanwhile, Warnock co-founded Adobe in the Bay Area with his former boss Charles Geschke. Adobe became a graphics and publishing software giant. Almost 10 years ago, it bought Utah digital marketing analytics provider Omniture for $2.1 billion (in today’s dollars). In the part of Lehi that Ashton developed, Adobe has been building office space for more than 2,000 employees.

Tech Growth and Opportunities

Utah tech is a driving force for innovation locally and nationally. Industry employment grew at nearly 5 percent per year from 2008 to 2018, more than double the growth rate of the rest of Utah’s economy. Among all states, Utah had the second-highest tech job growth rate.

Tech is what the doctor ordered for Utah’s economy, but there are side effects, like traffic congestion and housing affordability. The industry generates $2.5 billion in annual tax revenue to help state and local governments do their part to accommodate growth.

What’s Next?

The $8 billion acquisition of homegrown survey and research software company Qualtrics last November makes me wonder what will happen next. Like WordPerfect profits, Qualtrics investment returns have strong Utah ties. I also wonder what positive feedback might reverberate in Utah’s future economy from tech workers educated and trained here who, like John Warnock, pursue out-of-state opportunities.

To learn more, take a look at Vol. 1 of our new report, Utah’s Tech Economy: Economic Impacts, Industry Trends, Occupations, and Workers.

Levi Pace is a senior research economist at the Kem C. Gardner Policy Institute.