Software Industry Contributing More Than US$1 Trillion to US Economy

The direct economic impact of the software industry grew by 18.7% in the past two years, as well as creating 2.9 million direct and 10.5 million indirect jobs.

tech skill

As software eats the world, the industry is inevitably boosting global economies, particularly in the US, where the sector contributed US$1.14 trillion to the country’s GDP in 2016.

The direct economic impact of the sector grew by 18.7% in the past two years while the US economy grew 6.7%, according to a report from independent research organization the BSA Foundation.

“These gains extend far beyond the software industry; they create a ripple effect that magnifies opportunities and job growth in every industry across the country,” said Victoria Espinel, President and CEO of the Software Alliance.

Employment in the sector in 2016 grew fastest in Mississippi, Idaho, Louisiana, Kansas, and Indiana, with direct software employment in the latter two states growing more than 30%.

Country-wide, the industry led to the creation of 2.9 million direct jobs and 10.5 million indirect jobs.

The industry is not only growing into one of the largest employers, it is also fostering innovation in all economic sectors, raising wages for all and luring foreign investment.

Manufacturing, healthcare, transportation, and agriculture are among the sectors that benefited greatly by the innovation brought about by the software industry.

“A thriving innovation ecosystem, in turn, will provide smarter opportunities for growing our economy, protecting the environment, boosting education, and improving public safety,” said Chris Hopfensperger, Executive Director of BSA Foundation.

Sign up for our Nearshore Americas newsletter:

“In fact, software innovation is now poised to magnify, multiply, and exponentially increase opportunities far beyond the IT sector alone because it produces a powerful ripple effect that magnifies opportunities throughout the entire economy,” the report added.

In 35 states, value-added GDP directly attributable to the software industry grew more than 20% in 2016 – with Idaho and North Carolina up more than 40%.