NCPA - National Center for Policy Analysis

What The Economy Owes Info Tech

June 22, 1999

The information technology sector of the economy is holding down inflation, boosting employment and driving U.S. growth. That is the conclusion of a Commerce Department study scheduled for release today.

Information technology industries include producers of computer and communications hardware, software and services.

  • While this sector accounted for only 8 percent of the nation's total economic output from 1995 to 1998, it generated more than one-third of economic growth.
  • By 2006, almost half of U.S. workers will be employed by industries that produce information technology or are intensive users of it -- compared to 40 percent in 1989.
  • The rising quality and falling prices for info tech goods and services cut the overall inflation rate by 0.7 percent in both 1996 and 1997.
  • Workers in info tech industries in 1997 earned an average 78 percent more than workers in general -- $52,920 annually versus $29,787, and the wage gap is growing.

The report is entitled "The Emerging Digital Economy II" and is the second in a series of annual studies planned.

Source: Susan Page, "E-World Fuels U.S. Economy, Report Says," USA Today, June 22, 1999.


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