Apps-related jobs tallied at 466K in U.S.

Smartphones, tablets and their app stores are behind the 'App Economy,' study says

Nearly half a million jobs in the U.S. have been created because of the 1 million-plus applications designed for smartphones, tablets and other mobile devices, according to a new study.

Called the "App Economy," there are an estimated 466,000 U.S. jobs filled by app developers and those in related jobs in application infrastructure, according to a study (pdf format) released Tuesday by TechNet and written by economist Michael Mandel of SouthMountain Economics.

The App Economy generated almost $20 billion in revenue in 2011, the study states, based on app downloads, in-app revenues, sales of virtual and physical goods and services.

All the apps jobs have been created since 2007 after the introduction of the iPhone and the launch of the iPhone App Store shortly after. The Android Market and other app stores have since blossomed.

Mandel's study also found app jobs dispersed around the nation, with New York City, San Francisco and San Jose as the top locations. California is at the top of the list for App Economy states, but more than two-thirds of these jobs are outside of California and New York, the study says.

While the App Economy is growing "at a rapid clip," Mandel also notes it is "only four years old and extremely fluid." Both the number and location of the jobs are likely to shift in coming years, he says.

Mandel calls his numbers "estimates," using techniques he developed that were based on the Conference Board Help-Wanted Online database, a compilation of employment ads. He also said the 466,000 app jobs as of December 2011 may not be net jobs gained, but could be termed "jobs not lost."

Mandel's sponsor, TechNet, is a nonpartisan political network of technology executives from companies including Cisco, Dell and Google, that was founded in 1997. It is also involved in advocacy, having raised $3 million for political candidates in the 2008 election cycle. One goal of TechNet is to support efforts that make the U.S. a world leader in innovation.

Mandel cites mobile operating systems, such as Android, iOS, BlackBerry and Windows Phone, in helping create App Economy jobs, but he also mentions social networks, such as Facebook, for helping proliferate the use of apps. A University of Maryland study that Mandel cites attributes more than 53,000 jobs to employees of third-party developers of Facebook apps. Also, the 529,000 active apps in the Apple App Store as of December were uploaded by 124,000 active app publishers, who had staffs of varying sizes.

Because consumer-focused companies will often build an app to reach customers, Mandel said the App Economy is the "construction sector of the 21st century."

Mandel's estimates are sure to come under some scrutiny, but he thoroughly reveals his approach. In his study, he notes that want ads for app economy jobs for the last three months of 2011 totaled 44,400, which he multiplied by 3.5 because of the historical ratio of want ads to employment for computer and math occupations. He also doubled the resulting 155,400 estimated computer and math jobs in the App Economy to account for non-tech jobs in the App Economy, making a total of 310,800 jobs. He then multiplied that number by 1.5 to account for the jobs created outside of the app companies themselves, resulting in the approximately 466,000 total.

The App Economy is second in size to the custom computer programming sector, and just ahead of software publishers, Mandel said.

In terms of geographies, the New York area has 9.2% of the jobs, while the San Francisco area has 8.5%, and the San Jose area, 6.4%. The others in the top 10 were: Seattle area, 5.7%; Los Angeles area, 5.1%; Washington area, 4.8%; Chicago area, 3.5%; Boston area, 3.5%; Atlanta area, 3.3% and Dallas area, 2.6%.

As a state, California has 23.8% of the App Economy jobs, followed by New York with 6.9%.

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His e-mail address is mhamblen@computerworld.com.

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