July 8, 2016

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Viewpoint: The app economy is mighty but still needs support

By
Caroline Joiner
Austin Business Journal

Texas has established itself as one of the nation’s premiere technology hubs over the past two decades. For proof of this, look no further than the state’s flourishing app economy. A recent study published by the Progressive Policy Institute found the app economy has created 121,000 jobs for Texas since 2008— which ranks us third out of all 50 states and first in the South.

In Austin alone, roughly 22,000 app economy jobs have been created, representing 2 percent of the Austin-metro workforce. This includes app developers and other skilled workers concerned with building, maintaining or supporting mobile apps. The methodology uses online job postings for worker with app-related skills as a real time measure of app economy employment.

It’s been nearly eight years since Apple unveiled the App Store, and few could have predicted the revolutionary impact the marketplace has had on our lives and economy as a whole.

In less than a decade, the app economy has created 1.66 million jobs across the nation. Fueled by smartphones, the number of app economy jobs has grown at an annualized rate of 37 percent, dwarfing the growth rate of jobs in the rest of the economy.

It’s important to understand that the app economy is more than just one app or one platform. It includes app developers as well as large enterprises and growing companies that understand mobile apps are crucial for their customers and workers. It is a vast ecosystem.

So, what can be done to promote further growth of the app economy?

Foster  computer science skills. All apps start with an idea and a line of code. While Texas has committed to providing rigorous computer science education for all our K-12 students, there is currently no dedicated funding to bring computer science to school districts and to train high quality computer science teachers. If our state wants to expand computer science, then we must adequately invest in these initiatives, just like other states have.

Maximize access to talent. Texas public universities educate some of the world’s most talented innovators and entrepreneurs. However, our nation’s broken immigration system forces many entrepreneurs and engineers to leave after graduation to create competitor businesses abroad, rather than here in the United States. We should do more to encourage the best, brightest and most ambitious from all around the world to create jobs here in the United States.

Maximize access to capital. Entrepreneurs won a major victory this month when the new federal crowdfunding rules went into effect. Under the rules established by the SEC, companies can raise up to $1 million from ordinary investors, providing early-stage companies with the resources needed to grow and scale their product or service. In addition to crowdfunding, states can encourage investment in innovative, high-growth companies through the tax code — for example, the exclusion of state capital gains taxes on investments in startups that are held for more than five years.

 

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