President Donald J. Trump hosts a tax reform industry and business leaders meeting | October 31, 2017 (Official White House Photo by Shealah Craighead)
High-Tech Industry Employment Concentration, High-Tech Employment/All Employment, by Metro Area, 2015. Source: U.S. Census Bureau, 2015 County Business Patterns.
By Maureen Book, Research Analyst, SelectUSA
SelectUSA recently released its second industry-focused report: “High-Tech Industries: The Role of FDI in Driving Innovation and Growth.”
This report provides an in-depth look at high-tech clusters in the United States and gives the first-ever analysis of the role of foreign direct investment (FDI) in high-tech industries. The report’s biggest takeaway is that FDI plays a significant role in these industries.
Where Are High-Tech Clusters?
High-tech industries are defined as employing more than twice the concentration of science, technology, engineering and mathematics (STEM) workers compared to the national average. After analyzing the U.S. high-tech industry and considering participation of both foreign and domestic firms, SelectUSA explored the geography of high-tech companies in the United States by state, to identify large groups, or clusters, of employment. The top employers of high-tech workers were California, Texas and New York, while the District of Columbia, Virginia and Washington boast the highest employment per capita of high-tech jobs.
High-Tech Clusters by Metro Area
Looking at metro areas with the highest concentration of high-tech employment, SelectUSA found that San Jose, Calif., tops the list with more than 34 percent of local employment in high-tech industries. It was followed closely by Elkhart, Ind., with nearly 33 percent, and Huntsville, Ala., with over 31 percent.
While the concentration in San Jose might not be surprising because it is the largest city in the Silicon Valley, Elkhart and Huntsville both have industry concentrations nearby to make them important locations for high-tech companies. Elkhart’s economy is heavily concentrated in the transportation equipment manufacturing industry and centers around recreational and commercial vehicle manufacturing. While Huntsville is home to many military technology firms and aerospace and defense contractors.
The Role of Foreign Direct Investment (FDI)
Using our definition of high-tech industries and data published by the Bureau of Economic Analysis, SelectUSA looked at the role that FDI plays in high-tech industries. FDI generally involves not only monetary investment, but the management of a company by a foreign enterprise. To be considered FDI, the investment must usually be linked with the real output of the country in which it operates.
Our data found that FDI stock in high-tech industries reached over $1.6 trillion in 2016 and supported 2.1 million jobs in the United States. In fact, the high-tech component of FDI is quite robust – nearly 44 percent of all FDI in the United States is invested in high-tech industries.
Compensation, R&D, Exports and Value-Added Activities
Beyond employment, FDI in high-tech sectors has other significant contributions to the U.S. economy.
The U.S. affiliates of foreign-owned firms typically offer higher wages compared to domestic firms. In addition, companies engaged in FDI in high-tech industries offer higher average pay compared to FDI companies in other industries – more than $101,000 per worker.
U.S. affiliates of foreign-owned firms in the high-tech sector also spend nearly $42 billion on research and development (R&D). In 2015, they also contributed $154 billion towards U.S. goods exports and more than $373 billion towards value-added activities.
Source Markets Supporting High-Tech
We also find that Germany, the United Kingdom, France, and Japan are among the largest source markets for R&D spending, exports and value-added activities in high-tech industries. Beyond that, they are also the US’s traditional trading partners. Collaborating with them on FDI reinforces our trade relationships and strengthens the US’s bilateral ties with these partners.
On Oct. 24, President Trump and Secretary of Commerce Wilbur Ross welcomed winners of the National Minority Enterprise Development Award to the White House. This award is given by the Department of Commerce Minority Business Development Agency to recipients who display outstanding entrepreneurial spirit.
The U.S. Department of Commerce’s Minority Business Development Agency (MBDA) today announced the 2017 National Minority Enterprise Development (MED) Week Award winners. This year the Agency honored 15 minority business enterprises (MBEs), businesses leaders and advocates for their leadership, commitment and excellence in advancing the interests and the economic achievements of the minority business community.
For more than 30 years, MBDA has observed National MED Week by convening award winners, key business leaders, influencers, MBEs and advocates during a week-long celebration. MBDA will once again lead the annual observance by hosting special MED Week programming and events during the 2017 National Minority Supplier Development Council Conference and Business Opportunity Exchange (NMSDC) Oct. 22-25 in Detroit.
“MBDA is delighted to celebrate such a prestigious group of innovators, advocates and business leaders for their extraordinary efforts in contributing to the economic success of the minority business community and the U.S economy.Your entrepreneurial spirit symbolizes the best of America. We salute your accomplishments and the many years of hard work that you’ve dedicated to achieving your success,” said MBDA Acting National Director Christopher Garcia.
Since 1983, every U.S. president has issued a Presidential Proclamation designating National Minority Enterprise Development Week to recognize the contributions of the minority business community to the U.S. economy. This year, President Donald J. Trump proclaimed the 2017 National MED Week as Oct. 22-28.
MBDA National Director David Hinson, along with a 27-member delegation of U.S. corporate executives and minority-owned businesses, recently completed a China Business Opportunity Trade Mission to Beijing, Tianjin and Shanghai. The goal of the trade mission was to meet with potential corporate, government and university partners and attend the Minority Supplier Development (MSD) China Summit and Business Opportunity Fair.
The trip was organized by the National Minority Supplier Diversity Council (NMSDC) to foster business relations between American corporate and minority-owned businesses, corporate members of MSD China, and Chinese ethnic minority businesses that are not a part of the Han Chinese majority in China and Taiwan.
Director Hinson was a keynote speaker at the MSD China Summit and Business Opportunity Fair, held Sept. 1-2 at the Tasly International Conference Center in Tianjin. In his remarks, he encouraged participants to join in helping minority suppliers gain more business opportunities within the global economy.
The annual event brought together 80 corporate executives, minority supplier development professionals and purchasing executives, along with a host of Chinese and U.S. government officials, and about 100 minority business owners from China and the U.S. The Summit also included several delegations from ethnic minority regions within China.
“Among those core values that citizens of the United States and China share is the belief that we owe our success to the ingenuity, intellect and creativity of our people,” Hinson said.
Over the course of the two days, the Summit provided a forum for an exchange of ideas and included workshops onBusiness Opportunities with Multinational Corporations; Starting a Business in China: Practical Advice from Experts; How Traditional Chinese Medicine Goes International; and The Development of Chinese Ethnic Minorities and Chinese Minority Business Enterprises.
MSD China is the country’s first, national non-profit membership organization dedicated to enhancing the development of the 56 non-majority Chinese ethnic groups in business by connecting minority suppliers to corporations for procurement opportunities on a mutually beneficial basis.
The U.S. delegation attending the event included representatives from Dell, IBM, United Technologies Corporation, The Boeing Company, Hewlett-Packard Company, Marriott International, Inc., Merck, PepsiCo, and several minority businesses and leaders from the NMSDC. The China trade mission ran from Aug. 29 through Sept. 5.
Director Hinson’s time in China also included meetings in Beijing to discuss MBDA’s globalization program and objectives, investment opportunities in China, and current merger and acquisition trends. In addition, he met with the School of Continuing Education at Tsinghua University for an overview of its globalization program and to discuss minority business enterprise matching and the possibility of a joint program between Tsinghua and U.S. universities.
The Business Opportunity Trade Mission is a part of MBDA’s ongoing efforts to create access for minority businesses and broaden domestic and global opportunities through strategic partnerships.
On Tuesday, President Donald J. Trump welcomed over 100 small business owners to the White House for an event highlighting small businesses, “The Engine of the American Dream.” Together with the Administrator of the Small Business Administration (SBA), Linda McMahon, and Senior Advisor Ivanka Trump, President Trump demonstrated his Administration’s commitment to instituting policies that allow small businesses to flourish in America and to spotlight the large contributions that small businesses make to the American economy.
President Trump began his remarks in the East Room by thanking all the business owners for joining him at the White House and for the hard work they do across the Nation to create jobs and grow the economy. He then highlighted the steps his Administration has taken, and will continue to take, to end job-killing regulations, ease restrictions on American energy, and cut burdensome taxes. “America is on the verge of a golden age for small business,” said the President.
President Trump closed his remarks by reaffirming his commitment to America’s small businesses and assuring owners that his Administration will be behind them as they continue to grow and thrive in America. “You are the dreamers and innovators who are powering us into the future –- that’s exactly what you are — and my administration will be there with you every single step of the way,” he said.
After the President’s remarks, Administrator McMahon and Ivanka Trump held a question and answer session with the small business owners in the room. These small businesses represented numerous sectors of the American economy, including manufacturing, retail, and service. Topics of discussion included tax reform, growth resources, and regulatory relief.
President Trump has made economic and business reforms a central focus of his Administration. Small business is the engine of the American dream, and President Trump and his Administration are determined to create a competitive business climate and promote entrepreneurial success in the United States.
The Bureau of Economic Analysis today released statistics detailing the amount and type of new direct investments made in the United States by foreign investors in 2016, 2015 and 2014. The data released today includes information on investments broken out by industry, state and type of investment made – creating a new U.S. business or acquiring or expanding an existing one.
Business people, economists, researchers and policymakers can use the data to help them assess the impact of foreign direct investment on the U.S. economy and state economies. The data also help foreign entrepreneurs and others seeking to invest in the United States make informed business decisions. Additionally, the data inform national and state policymakers who shape programs to attract foreign direct investment.
Expenditures by foreign direct investors to acquire, establish, or expand U.S. businesses were $373.4 billion in 2016, down $66.2 billion, or 15 percent, from $439.6 billion in 2015.
Expenditures for acquisitions were $365.7 billion, expenditures to establish new U.S. businesses were $5.6 billion, and expenditures to expand existing foreign-owned businesses were $2.2 billion.
Total greenfield investment expenditures—expenditures to either establish a new U.S. business or to expand an existing foreign-owned U.S. business—for investments initiated in 2016 which include both first-year expenditures and planned spending in other years, totaled $22.0 billion.
Employment at newly acquired, established, or expanded foreign-owned businesses in the United States was 480,800 employees.
With this release, the Bureau of Economic Analysis (BEA) is introducing statistics on planned and actual expenditures for greenfield investments. The new statistics are available on BEA’s website.
BUREAU OF ECONOMIC AND BUSINESS AFFAIRS
March 14, 2017
Topic: Opportunities in China’s Senior Care Market
Host: Hanscom Smith, U.S. Consul General in Shanghai, China
Date, time, time zone (DC): March 14, 2017; 7:00 p.m. EDT (March 15, 2017; 7:00 a.m. local)
Description of Webinar: By 2050, China is expected to have nearly 500 million people over the age of 60, exceeding the population of the United States. The aging population has brought greater demand for senior care services. According to a PricewaterhouseCoopers report, Chinese people will spend over 10 trillion yuan ($1.54 trillion) from 2016 to 2020 on senior care, increasing one percent per year. The Chinese government issued policies in its 13th Five Year Plan to further improve the senior care system, including opening up the market and encouraging private and overseas investment.
U.S. companies with more advanced products and operational experiences are appealing in the China market, especially in the following areas:
- Healthcare – Gerontology, Rehabilitation & Chronic Diseases Care
- Health and Wellness
- IT – Telemedicine, Mobile Health IT, Home Health IT, Facility IT solutions, On-Demand Platform, Virtual Reality, Artificial Intelligence, Big Data Analysis, Wearables, Robots, Internet of Things
- Architectural Design Services
- Safety Technologies – Emergency Call, Floor Protection
- Consulting Services & Training
The U.S. Consul General in Shanghai, Hanscom Smith, invites you to participate in a Direct Line Webinar along with his Economic team and local subject matter experts to discuss how your company can navigate the Chinese Senior Care market and what strategies can help win projects in China’s rapidly developing Senior Care Market.
The CSIS Simon Chair in Political Economy, Scholl Chair in International Business, and Southeast Asia Program host the rollout of a new report, “Reinvigorating U.S. Economic Strategy in the Asia Pacific: Recommendations for the Incoming Administration,” by the CSIS Asia Economic Strategy Commission.
CSIS launched the Asia Economic Strategy Commission in September 2015 under the leadership of Charlene Barshefsky, Evan Greenberg, and Jon Huntsman. The commission consisted of 18 national leaders with extensive experience in government, the private sector, nongovernmental organizations, and academia. The goal of the the commission was to develop a reinvigorated U.S. economic strategy in a changing Asia Pacific. Please join the three cochairs as they discuss the commission’s findings and recommendations.