Published on March 31st, 2015 | by Joshua New0
The Data Economy is a Rich Source of High-Paying Jobs
This blog appeared in Master’s in Data Science.
Earlier this month the U.S. Department of Commerce published a report that found data is fueling a rapid growth in high-paying, high-skilled jobs in the public and private sector and transforming the United States’ occupational landscape. The report, titled “The Importance of Data Occupations in the U.S. Economy”, defined “data jobs” as occupations which place high importance on analyzing data, processing data (i.e. coding and auditing), and interacting with computers (i.e. to write software and perform data entry) and found that there were 10.3 million of these jobs in 2013, or about 7.8 percent of all employment. The report acknowledges that this is a conservative estimate—if the criteria were broadened to include jobs that place these activities as “important”, instead of just “very important”, data jobs would include 64 million jobs, or 59 percent of employment in the United states. Due to the enormous influence of data on the economy, policymakers should avoid restrictions on data collection, use, and retention that would likely negatively impact the job market. Additionally, policymakers should invest in data science education to meet the pressing need for data-literate workers in the United States.
The increased use of data in the private sector has been one of the leading drivers of job growth in the past decade. Of the 10.3 million data jobs identified in the report, 8.6 million are in the private sector. These jobs are highly paid, with an average hourly wage of $40.30 in 2013—68 percent higher than the average wage for all of industry. From 2003 to 2013, private sector industries that are considered data-intensive, with at least 25 percent of employees in data occupations, increased the number of data jobs by 21 percent, compared to the overall average job growth of five percent for this period. Additionally, these data-intensive industries grew faster during the economic recovery period of 2010-2013, seeing a 9.4 percent increase in employment, compared to the 6.2 percent average. Given the importance of data to jobs, policymakers should think twice about policies to restrict private sector use of data. Attempts at enacting broad-based privacy legislation that would limit data collection could hinder the potential for the private sector to find new applications for data and create jobs to act on these opportunities.
Data workers were found to be considerably more educated than average. Nearly 70 percent have a bachelor’s degree or higher. In comparison, just about 35 percent of the average workforce has the same level of education. To sustain the growth of the data economy, the United States needs a workforce that is educated to meet the needs of companies that want to innovate and grow in the United States. The labor market is already struggling to meet this demand, creating a data science skills gap, and this problem will only grow worse if education institutions on all levels do not adequately train the emerging workforce with the necessary data skills. To ensure that the economy’s growth is not hindered by a lack of qualified workers, federal and state lawmakers should promote data science education at all levels. Policymakers should fund efforts to expand enrollment in statistics and computer science courses and support the development of massive open online courses that teach data skills, accessible to both those in school and those already in the workforce seeking to become data literate. Secondary schools can also help develop a pipeline of future data-literate workers by creating more flexible math requirements, so that students can take computer science or statistics courses.
It is important to note that this report uses data from 2013. The trend towards more data-driven industry and the creation of more data jobs has no doubt continued, if not increased, since then, making the impact of data on the economy even more significant. As companies increasingly rely on data to improve operations and develop new products, policymakers should ensure that rules and regulations support this growth, rather than restrict it. As data generation and collection increases with new technologies like the Internet of Things, there will be an even greater need for policymakers to develop a workforce that can make use of all this data and craft policies that allow such technology to flourish.
Image: Flickr user Daniel Ramirez.