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Tampa Bay economy

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Title:
Tampa Bay economy
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Book
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English
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University of South Florida -- Center for Economic Development Research
Publisher:
University of South Florida, College of Business Administration, Center for Economic Development Research.
Place of Publication:
Tampa, Fla

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Subjects / Keywords:
Economic conditions -- Periodicals -- Tampa Bay Region (Fla.)   ( lcsh )
Economic conditions -- Statistics -- Periodicals -- Tampa Bay Region (Fla.)   ( lcsh )
Commerce -- Periodicals -- Tampa Bay Region (Fla.)   ( lcsh )
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non-fiction   ( marcgt )

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University of South Florida Library
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University of South Florida
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All applicable rights reserved by the source institution and holding location.
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usfldc doi - C63-00073
usfldc handle - c63.73
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SFS0000347:00001


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Volume 5, No. 1 Summer 2005 High-Tech Establishments in Florida By Michael Bernabe, Graduate Research Assistant, Center for Economic Development Research Editors note: In our last issue, we pr esented an analysis of High-Tech Jobs in Florida. It showed an interstate comparison of High-Tech job activity between Florida and three other states -Arizona, North Carolina, and Texas chosen as benchmarks. I t also showed an intrastate comparison of the job activity within different Hi gh-Tech industry groupings. It revealed a strong correlation between the number of jobs and number of est ablishments within the HighTech Industries. The High-Tech Job analysis spanned a period of six years from 1998 to 2003. But the analysis was broken down into two periods, 1998 to 2000 and 2001 to 2003, due to both a change in the industry classification me thod and the consequent definition of a High-Tech Indus try. Similarly, this article presents an analysis of High-Tech Establishments in Florida. High-Tech Industries typically use state-of-theart techniques, devote a high proportion of expenditures to research and developm ent, and employ scientific, techni cal, and engineering personnel. The Bureau of Labor Statistics (BLS) list of High-Tech Industry Groups is generated using data on the amount of employment in an industry accounted for by scientific, technical and engineering personnel engaged in res earch and development activities. Industries are considered High-Tech if employment in both research and development and in all technology-oriented occupations accountsfor an amount of employment that is at least twice the average amount of employees for all industries in the 1998 Occupational Employment Statistics (OES) survey. This list is the basis of the USF Center for Economic Development Research (CEDR) analysis of High-Tech Establishments in the state of Florida from 1998 through 2000. The BLS revised the Standard Industrial Classification (SIC ) based list in 2002 to reflect the conversion to th e North American Industry Classification System (NAICS). Chapple, et. al. (2004, Feb), Gauging Metropo litan High-Tech and I-Tech Activity [Electronic Version]. Economic Development Quarterly, 18, (1), 10-29, uses the 1998 OES to identify all three-digit SI C manufacturing and serviceproducing industries with 9% (three times the average ofthe economy as a whole) of their national workforce in science and engineering jobs to develop a list of High-Tech Industry Groups. Then, Carnegie Mellon University Center for Economic Development takes this list of High-Te ch Industry Groups (SIC based) and converts it to a lis t of High-Tech Industries (NAICS based). Using empl oyment data from the updated 2002 OES and following the same methodology as Chapple, et. al. (2004), the Carnegie Mellon University Center for Economic Development makes a new list, which is the basis of the USFCEDRs analysis of High-Tech Establishments in the state of Florida from 2001 through 2003. Table 1 shows the number of establishm ents in Florida in 1998, 1999 and 2000 within each HighTech Industry Group according to SIC. Establishments are the physical locations of a certain economic activity--for exampl e, factories, mines, stores, or offices. A singl e establishment generally produces a single good or pr ovides a single service. High-Tech Establishments in Florida increased by 10.44% from 1998 to 1999, and increased by 8.88% from 1999 to 2000. (Continued on page 3)

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Table 1 From the Editor This is the second issue of The Tampa Ba y Economy (TBE) for 2005, published solely in electronic form. High-Tech Establishments in Florida is the lead repor t in this issue. The article analyzes, for the period 1998-2003, trends in Florida high-tech employment, and compares Floridas experience to those of other selected states. Another article, The Do-Not-Call Registry and Telem arketing Employment, 2001-2004, examines the predicted effects of this law and employment trends in th e telemarketing industry. CEDR will conduct the 29th annual USF Basic Economic Development C ourse in October 2005. This issue of the TBE includes a brief preview of the course. The article on The Impact of Medicaid Expenditures on Floridas Sales Tax Revenues summarizes a CEDR research report completed in March 2005. Dave Sobush and Michael Bernabe wrote articles for this issue of the TBE; however, both left CEDR to pursue other opportunities, prior to this publication. To help us m ake the journal add even more value to Tampa Bays economic development community, we ask the journals readers to send their comments to: cedr@coba.usf.edu with the subject line Journal Comments. The Tampa Bay Economy Volume 5, No. 1 Summer 2005 Table of Contests High-Tech Jobs in Florida...1 From the Editor........2 The Do-Not-Call Registry and Telemarketing Employment, 2001-2004...11 USFs Basic Economic Development Course.10 The Impact of Medicaid Expenditures on Floridas Sales Tax Revenues...13 CEDR Staff Dr. Dennis Colie..Director Dodson Tong..Data Manager Nolan Kimball...Coordinator of Information/Publications Alex McPherson...Economist Anand Shah.Web Designer Carol Sumner.......Research Assistant Norman Blake......Graduate Research Assistant University of South Florida 2

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Table 1 Private Sector High-Tech Establishments in Florida by Industry Establishments SIC Code Industry Group 1998 1999 2000 281 Industrial Inorganic Chemicals 44 45 43 282 Plastics Materials and Synthetics 55 54 65 283 Drugs 101 95 94 284 Soap, Cleaners, and Toilet Goods 137 136 135 285 Paints 71 65 76 286 Industrial Organic Chemicals 33 27 18 287 Agricultural Chemicals 89 80 87 289 Miscellaneous Chemical Products 82 87 79 291 Petroleum Refining nd nd 11 348 Ordinance and Accessories, N.E.C. 25 23 25 351 Engines and Turbines 29 26 32 353 Construction and Related Machinery 145 155 139 355 Special Industry Machinery 142 143 146 356 General Industrial Machinery 187 195 193 357 Computer and Office Equipment 134 133 115 361 Electric Distribution Equipment 39 34 35 362 Electrical Industrial Apparatus 72 86 92 365 Household Audio and Video Equipment 44 50 57 366 Communications Equipment 194 187 193 367 Electronic Components an d Access ories 253 249 262 371 Motor Vehicles and Equipment 202 187 182 372 Aircraft and Parts 184 174 174 376 Guided Missiles, Space Vehicles 22 22 18 381 Search and Navigation Equipment 55 53 49 382 Measuring and Controlling Devices 235 241 240 384 Medical Instruments and Supplies 268 281 254 386 Photographic Equipments and Supplies 32 34 34 737 Computer and Data Processing Services 5,739 6,934 8,585 871 Engineering and Architectural Services 4,451 4,734 5,126 874 Management and Public Relations 12,139 13,303 13,746 Total Florida High-Tech Esta bl ishments 25,203 27,833 30,305 Total Florida Establishments (Private Sector) 421,782 429,947 439,064 Summary Indicator 5.98% 6.47% 6.90% Source: Compiled by CEDR from US Department of Labor, Bureau of Labor Statistics, State and County Employment Wages from Covered Employment and Wages, available at http://data.bls.gov/cgi-bin/dsrv?ew *n/d: Not Disclosable data do not meet BLS or State Agency disclosure standards, usually because a minimum employment amount has not been met. (Continued from page 1) Our Summary Indicator for High-Tech Establishm ents is the percentage of High-Tech Establishments to total establ ishments in Florida. This indicator assesses whether High-Tech Establishments are increasin g relative to total establishments. The Summary Indicators for this time period show that in 1998, 5.98% of establishments in Florida were in High-Tech Industries. In 1999, the number of establishments in Floridas High-Tech Industries climbed to 6.47% and up again to 6.90% in 2000. Table 1 also shows the followin g industr y g rou p s to 3

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value of High Tech Establishments Table 2 Summary Indicators for Privat e High-Tech Establishments Year Measure State: Arizona Florida North Ca rolina Texas 1998 High-Tech Establishments 8,075 25,203 10,067 26,610 Total Establishments 109,686 421,782 196,219 460,472 Summary Indicator 7.36% 5.98% 5.13% 5.78% 1999 High-Tech Establishments 8,315 27,833 11,570 29,245 Total Establishments 110,858 429,947 206,673 467,014 Summary Indicator 7.50% 6.47% 5.60% 6.26% 2000 High-Tech Establishments 9,040 30,305 12,997 31,942 Total Establishments 113,394 439,064 213,803 475,294 Summary Indicator 7.97% 6.90% 6.08% 6.72% Source: US Department of Labor, Bureau of Labor Statistics, State and County Employment and Wages from the Quarterly Census of Employment and Wages (2001 forward), http://www.bls.gov/data/home.htm Chart 1 Summary Indicators High-Tech Establishments 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% 9.00% 1998 1999 2000 YearHigh-Tech Establishments as a Percentage of All Establishments Arizona Florida North Carolina Texas Source: US Department of Labor, Bureau of Labor Statistics, State and County Employment and Wages from the Quarterly Census of Employment and Wages (2001 forward), http://www.bls.gov/data/home.htm have the most High-Tech Establishments: Management and Public Relations (SIC 874), Computer and Data Proce ssing Services (SIC 737), Engineering and Architectural Services (SIC 871), Medical Instruments and Supplies (SIC 384), and Electronic Components and Accessories (SIC 367). Table 2 provides a com parison of the Summary Indicators for Pr ivate Sector High-Tech Establishments in Florida with a group of selected states as benchmarks. Chart 1 is a visual comparison. All four states (Arizona, Florida, North Carolina, and Texas) experienced a year-to-year increase in the absolute value of High-Tech Establishments and HighTech Establishments as a percent of total establishments. Texass summary indicator shows the largest increase at .96% over the period, North Carolina comes a close second with an increase of .95% and Florida third with an increase of .92%. 4

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Table 3 indicates the year-over-year percent change in number of establishments within each HighTech Industry Group in Flor ida. From 1998 to 1999 the Computer and Data Pro cessing Services (SIC 737) industry experienced the larg est percent increase of about 21%, while the Indus trial Organic Chemicals (SIC 286) industry experienced the largest percent decrease of approximately -18%. Similarly, from 1999 to 2000 the Computer and Data Processing Services (SIC 737) industry experienced the largest percent increase of nearly 24%, and the Industrial Organic Chemicals (SIC 286) industry experienced the largest percent decrease of about -33%. Only 4 HighTech Industry Groups experienced positive growth in b oth 2002 and 2003 with 2003s growth being larger than 2002s. Those industries are: Special Industry Machinery (SIC 355), Hous ehold Audio and Video Equipment (SIC 365), Computer and Data Processing Services (SIC 737), and Engi neering and Architectural Services (SIC 871). Table 3 Percent Change in Private Sector Hig h-Tech Establishments in Florida (by Industry) % Change SIC Code Industry Group 1998 to 1999 1999 to 2000 281 Industrial Inorganic Chemicals 2.27% -4.44% 282 Plastics Materials and Synthetics -1.82% 20.37% 283 Drugs -5.94% -1.05% 284 Soap, Cleaners, and Toilet Goods -0.73% -0.74% 285 Paints -8.45% 16.92% 286 Industrial Organic Chemicals -18.18% -33.33% 287 Agricultural Chemicals -10.11% 8.75% 289 Miscellaneous Chemical Products 6.10% -9.20% 291 Petroleum Refining N/A N /A 348 Ordinance and Accessori es, N.E.C. -8.00% 8.70% 351 Engines and Turbines -10.34% 23.08% 353 Construction and Related Machinery 6.90% -10.32% 355 Special Industry Machinery 0.70% 2.10% 356 General Industrial Machinery 4.28% -1.03% 357 Computer and Office Equipment -0.75% -13.53% 361 Electric Distribution Equipment -12.82% 2.94% 362 Electrical Industrial Apparatus 19.44% 6.98% 365 Household Audio and Video Equipment 13.64% 14.00% 366 Communications Equipment -3.61% 3.21% 367 Electronic Components an d Access ories -1.58% 5.22% 371 Motor Vehicles and Equipment -7.43% -2.67% 372 Aircraft and Parts -5.43% 0.00% 376 Guided Missiles, Space Vehicles 0.00% -18.18% 381 Search and Navigation Equipment -3.64% -7.55% 382 Measuring and Controlling Devices 2.55% -0.41% 384 Medical Instruments and Supplies 4.85% -9.61% 386 Photographic Equipments and Supplies 6.25% 0.00% 737 Computer and Data Processing Services 20.82% 23.81% 871 Engineering and Architectural Services 6.36% 8.28% 874 Management and Public Relations 9.59% 3.33% Sources: Compiled by CEDR from 1) Carnegie Mellon Un iversity Center for Economic Development (CED), Table 1: Technology Employers, http ://www.ssti.org/Publications/onl ine.htm 2) US Department of Labor, Bureau of Labor Statistics, State and County Employment and Wages from the Quarterly Census of Employment and Wages (2001 forward), http://www.bls.gov/data/home.htm *N/A: Not Available a percent change was not available due to no data disclosed to make a calculation 5

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Table 4 Private High-Tech Establishmen ts in Fl orida by Industry NAICSIndustry 200120022003 211111Crude Petroleum and Natural Gas Extraction 19nd19 325110Petrochemical Manufacturing ndndnd 325120Industrial Gas Manufacturing 172018 325131Inorganic Dye and Pigment Manufacturing 556 325188All Other Basic Inorganic Chemical Manufacturing ndndnd 325192Cyclic Crude and Intermediate Manufacturing nd 0nd 325199All Other Basic Organic Chemical Manufacturing 10nd11 325411Medicinal and Botanical Manufacturing 151413 325412Pharmaceutical Preparation Manufacturing 575561 325413In-Vitro Diagnostic Substance Manufacturing nd 8 8 325414Biological Product (except Diagnostic) Manufacturing nd 4 4 333210Sawm ill and Woodworking Machinery Manufacturing 8 6nd 333292Plastics and Rubber Industry Machinery Manufacturing ndndnd 333293Textile Machinery Manufacturing 312825 333294Printing Machinery and Equipment Manufacturing 231919 333295Semiconductor Machinery Manufacturing ndndnd 333298All Other Industrial Machinery Manufacturing 373638 333313Office Machinery Manufacturing 151312 333314Optical Instrument and Lens Manufacturing 352925 333315Photographic and Photocopying Equipment Manufacturing 131214 333319Other Commercial and Service Industry Machinery Manufacturing 10410096 334111Electronic Computer Manufacturing 454142 334113Computer Terminal Manufacturing 657 334119Other Computer Peripheral Equipment Manufacturing 384244 334210Telephone Apparatus Manufacturing 444138 334220 Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing 1039595 334290Other Communications Equipment Manufacturing 484746 334310Audio and Video Equipment Manufacturing 464038 334412Bare Printed Circuit Board Manufacturing 716563 334413Semiconductor and Related Device Manufacturing 505345 334414Electronic Capacitor Manufacturing 876 334415Electronic Resistor Manufacturing 876 334417Electronic Connector Manufacturing 121112 334418Printed Circuit Assembly (Electronic Assembly) Manufacturing 464942 334419Other Electronic Component Manufacturing 394042 334510Electromedical and Electrotherapeutic Apparatus Manufacturing 434045 334511 Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing 535152 334512 Automatic Environmental Control Manufacturing for Residential, Commercial, and Appliance Use 272522 334513 Instruments and Related Products Manufacturing for Measuring, Displaying, and Controlling Industrial Process Variables 575153 334514 Totalizing Fluid Meter and Counting Device Manufacturing 242120 334515 Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals 514545 334516 Analytical Laboratory Instrument Manufacturing 232021 334517 Irradiation Apparatus Manufacturing 10 912 334519 Other Measuring and Controlling Device Manufacturing 293640 336411 Aircraft Manufacturing 444956 336412 Aircraft Engine and Engine Parts Manufacturing 575452 336413 Other Aircraft Part and Auxiliary Equipment Manufacturing 515249 336419 Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing ndndnd 511210 Software Publishers 210230249 541310 Architectural, Engineering, and Related Services 1,5761,6291,701 541330 Engineering Services 3,3543,5843,775 541370 Surveying and Mapping (except Geophysical) Services 682698735 541380 Testing Laboratories 379379388 541511 Custom Computer Programming Services 3,3373,5113,858 541512 Computer Systems Design Devices 2,9532,9913,106 541710 Research and Development in the Physical, Engineering, and Life Sciences 601580594 541720 Research and Development in the Social Sciences and Humanities 184171167 Total High-Tech Establishments 14,69815,11815,935 Total Establishments (Private Sector) 448,336469,164488,591 Summary Indicator 3.28%3.22%3.26% ESTABLISHMENTS Sources: Compiled by CEDR from 1) Carnegie Mellon University Ce nter for Economic Development (CED), Table 1: Technology Emplo yers, http://www.ssti.org/Publications/online.htm 2) US Department of Labor, Bureau of Labor Statistics, State and County Employment and Wages from the Quarterly Census of Employment and Wages (2001 forward), http://www.bls.gov/data/home.htm *nd: Not Disclosable data do not meet BLS or State A g enc y disclosure standards usuall y because a minimum em p lo y ment amount has not been met. 6

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Table 4 shows the number of establishments in Florida in 2001, 2002 and 2003 within each HighTech Industry, classified by NAICS. High-Tech establishments in Florida increased by 2.86% from 2001 to 2002, and increased by 5.40% from 2002 to 2003. The Summary Indicators for this time period shows that in 2001, 3.28% of establishments in Florida were in High-Tech Industries. In 2002, the number of establishments in Floridas High-Tech Industries dropped to 3.22% but climbed back up to 3.26% in 2003. Table 4 also shows the following industries to hold the most High-Tech Establishments: Engineering Services (NAICS 541330), Custom Computer Programming Systems (NAICS 541511), Computer Systems Design Devices (NAICS 541512), Architectural, Engineering, and Related Services (NAICS 541310) and Surveying and Mapping (except Geophysical Services (NAICS 541370). Table 5 provides a com parison of the Summary Indicators for Privat e Sector High-Tech Establishments in Florida with a group of selected states as benchmarks. Chart 2 is a visual comparison. Three of the four states (A rizona, Florida, and Texas) experienced a year-to-year increase in the absolute value of total establishments Only Florida and North Carolina experienced a year-to-year increase in the absolute values of High-Tech Establishments throughout the period. North Carolina was the only state that did not show a decline in their summary indicator in the period 2001 to 2003. Floridas summary indicator showed th e least variability within the timeperiod, indicating some consistency between the number of High-Tech Establishments relative to the number of total establishments. Table 5 Summary Indicators for Privat e High-Tech Establishments Year Measure State: Arizona Florida N. Carolina Texas 2001 High-Tech Establishments 5,304 14,698 6,980 22,188 Total Establishments 116,748 448,336 215,872 479,492 Summary indicator 4.54% 3.28% 3.23% 4.63% 2002 High-Tech Establishments 5,230 15,118 7,249 22,256 Total Establishments 118,870 469,164 224,623 483,890 Summary indicator 4.40% 3.22% 3.23% 4.60% 2003 High-Tech Establishments 5,335 15,935 7,295 22,007 Total Establishments 123,825 488,591 217,053 488,251 Summary indicator 4.31% 3.26% 3.36% 4.51% Source: US Department of Labor, Bureau of Labor Statistics, State and County Employment and Wages from the Quarterly Census of Employment and Wages (2001 forward), http://www.bls.gov/data/home.htm 7

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Chart 2 Summary Indicators High-Tech Establishments 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 4.50% 5.00% 2001 2002 2003 YearHigh-Tech Establishments as a Percentage of All Establishment s Arizona Florida North Carolina Texas Source: US Department of Labor, Bureau of Labor Statistics, State and County Employment and Wages from the Quarterly Census of Employment and Wages (2001 forward), http://www.bls.gov/data/home.htm Table 6 indicates the year-over-year percent change in number of establishments within each HighTech Industry in Florida. From 2001 to 2002 the Other Measuring and Controlling Device Manufacturing (NAICS 334519) industry experienced the largest percen t increase of about 24%, while the Sawmill and Woodworking Machinery Manufacturing (NAICS 333210) industry experienced the largest percent decrease -25%. From 2002 to 2003 (preliminary data) the Computer Terminal Manufacturing (NAICS 334113) industry experienced the largest percent increase of 40%, and the Semiconductor and Related Device Manufacturing (NAICS 334413) industry experienced the largest percent decrease -15%. Only 6 High-Tech industries experienced positive growth in both 2002 and 2003 with 2003s growth being la rger than 2002s. Those industries are: Other Electronic Component Manufacturing (NAICS 334419), Aircraft Manufacturing (NAICS 336411), Architectural, Engineering, and Related Services (NAICS 541310), Surveying and Mapping (except Geophysical) Services (NAICS 541370) Custom Computer Programming Services (NAICS 541511), and Computer Systems Design Devices (NAICS 541512). 8

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Table 6 Percent Change in Private Sector High-Tech Establishments in Florida (by Industry) NAICSIndustry 2001-20022002-2003 211111Crude Petroleum and Natural Gas Extraction N/A* N/A 325100Basic Chemical Manufacturing N/A N/A 325110Petrochemical Manufacturing N/A N/A 325120Industrial Gas Manufacturing 17.65%-10.00% 325131Inorganic Dye and Pigment Manufacturing 0.00%20.00% 325182Carbon Black Manufacturing N/A N/A 325188All Other Basic Inorganic Chemical Manufacturing N/A N/A 325192Cyclic Crude and Intermediate Manufacturing N/A N/A 325199All Other Basic Organic Chemical Manufacturing N/A N/A 325411Medicinal and Botanical Manufacturing -6.67%-7.14% 325412Pharmaceutical Preparation Manufacturing -3.51%10.91% 325413In-Vitro Diagnostic Substance Manufacturing N/A 0.00% 325414Biological Product (except Diagnostic) Manufacturing N/A 0.00% 333210Sawmill and Woodworking Machinery Manufacturing -25.00%N/A 333292Plastics and Rubber Industry Machinery Manufacturing N/A N/A 333293Textile Machinery Manufacturing -9.68%-10.71% 333294Printing Machinery and Equipment Manufacturing -17.39%0.00% 333295Semiconductor Machinery Manufacturing N/A N/A 333298All Other Industrial Machinery Manufacturing -2.70%5.56% 333313Office Machinery Manufacturing -13.33%-7.69% 333314Optical Instrument and Lens Manufacturing -17.14%-13.79% 333315Photographic and Photocopying Equipment Manufacturing -7.69%16.67% 333319Other Commercial and Service Industry Machinery Manufacturing-3.85%-4.00% 334111Electronic Computer Manufacturing -8.89%2.44% 334113Computer Terminal Manufacturing -16.67%40.00% 334119Other Computer Peripheral Equipment Manufacturing 10.53%4.76% 334210Telephone Apparatus Manufacturing -6.82%-7.32% 334220 Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing -7.77%0.00% 334290Other Communications Equipment Manufacturing -2.08%-2.13% 334310Audio and Video Equipment Manufacturing -13.04%-5.00% 334412Bare Printed Circuit Board Manufacturing -8.45%-3.08% 334413Semiconductor and Related Device Manufacturing 6.00%-15.09% 334414Electronic Capacitor Manufacturing -12.50%-14.29% 334415Electronic Resistor Manufacturing -12.50%-14.29% 334417Electronic Connector Manufacturing -8.33%9.09% 334418Printed Circuit Assembly (Electronic Assembly) Manufacturing 6.52%-14.29% 334419Other Electronic Component Manufacturing 2.56%5.00% 334510Electromedical and Electrotherapeutic Apparatus Manufacturing -6.98%12.50% 334511Search, Detection, Navigation, Guidance, Aeronautical, and Nautical S y stem and Instrument Manufacturin g -3.77%1.96% 334512Automatic Environmental Control Manufacturing for Residential, Commercial and A pp liance Use -7.41%-12.00% 334513Instruments and Related Products Manufacturing for Measuring, Dis p la y in g, and Controllin g Industrial Process Variables -10.53%3.92% 334514Totalizing Fluid Meter and Counting Device Manufacturing -12.50%-4.76% 334515Instrument Manufacturing for Measuring and Testing Electricity and Electrical Si g nals -11.76%0.00% 334516Analytical Laboratory Instrument Manufacturing -13.04%5.00% 334517Irradiation Apparatus Manufacturing -10.00%33.33% 334519Other Measuring and Controlling Device Manufacturing 24.14%11.11% 336411Aircraft Manufacturing 11.36%14.29% 336412Aircraft Engine and Engine Parts Manufacturing -5.26%-3.70% 336413Other Aircraft Part and Auxiliary Equipment Manufacturing 1.96%-5.77% 336419Other Guided Missile and Space Vehicle Parts and Auxiliary E q ui p ment Manufacturin g N/A N/A 511210Software Publishers 9.52%8.26% 541310Architectural, Engineering, and Related Services 3.36%4.42% 541330Engineering Services 6.86%5.33% 541370Surveying and Mapping (except Geophysical) Services 2.35%5.30% 541380Testing Laboratories 0.00%2.37% 541511Custom Computer Programming Services 5.21%9.88% 541512Computer Systems Design Devices 1.29%3.84% 541710Research and Development in the Physical, Engineering, and Life Sciences -3.49%2.41% 541720Research and Development in the Social Sciences and Humanities -7.07%-2.34% % Change Sources: Compiled by CEDR from 1) Carnegie Mellon University Ce nter for Economic Development (CED), Table 1: Technology Emplo yers, http://www.ssti.org/Publications/online.htm 2) US Department of Labor, Bureau of Labor Statistics, State and County Employment and Wages from the Quarterly Census of Employment and Wages (2001 forward), http://www.bls.gov/data/home.htm *N/A: Not Available a p ercent chan g e was not available due to no data disclosed to make a calculation 9

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Under the earlier definition of High-Tech Industries and under the Standard Industrial Classification system the state of Floridas summary indicators came second only to Arizonas among the b enchmark states during 1998 to 2000. During the same time span the number of private sector HighTech Esta b lishments in the state of Florida were second only to Texas among the benchmark states. Then during 2000 to 2003, using a new definition of High-Tech Industries and now the North American Industry Classification System, Florida did not fare so well in comparison to the benchmark states. As indicated by the summary indicators, while Florida remained consistent regarding the number of HighTech Establishments compared to the number of total establishments, it was also the state with the lowest indicator during the two most recent years (2002 and 2003). This shows that in comparison to the other b enchmark states, Florida is showing a trend of having relatively, the least amount of establishments belonging in High-Tech Industries. But on a positive note, although Florida is showing the most year-toyear growth in High-Tech Establishments, total establishments are growing by a relatively larger amount each year. USFs Basic Economic Development Course By Nolan Kimball, Coordinator of Information/Publications The course is the first step for anyone planning to becom e certified in the economic development field. USFs BEDC offers a diverse and experienced faculty, composed of both academicians and practitioners providing an ex cellent blend of theory and practice. with the Center for Eco nomic Development Research, University of South Florida (USF) This year marks the 29th Annual USF Economic Development Course. The course will be held at the DoubleTree Guest Suites of Tampa Bay in Tampa, Florida from October 23 28, 2005. Because participation and discussion are strongly encouraged, the class capacity is lim ited to 50 people. For further inform ation on the course, contact Ms. Nolan Kimball at (813) 905 5854 or nkimball@coba.usf.edu The weeklong course, which is accredited by the International Econo m ic Development Council (IEDC), serves as an introduction to economic development. Eighteen universities and state agencies around the U.S. offer the IEDC accredited basic economic development course (BEDC) at different times throughout the year. 10

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The Do-Not-Call Registry and Te lemarketing Employment, 2001-2004 By Dave Sobush, Economist with the Center for Economic Development Research The purpose of this article is to present employment data on both a regional and national level for the telemarketing industry and also to compare reported predicted effects of the National Do Not Call Registry, prohibiting certain telemarketers sales pitches, with the post-enactment experience. Telemarketing bureaus provide telemarketing services on a contract or fee basis for others. These services typically fall into one of the following categories: Promotion of clients products or services by telephone Taking orders by telephone for clients products and services Providing infor mation or soliciting contributions for clients by telephone. On March 11, 2003, President George W. Bush authorized the creation of the National Do Not Call (DNC) Registry. The registry, m anaged by the Federal Trade Commission (FTC), was created to offer consumers a choice regarding telemarketing calls. The legislation allows consumers to submit their phone numbers to a national database, and b eginning October 1, 2003, telemarketers faced fines of $11,000 for each call made to registered numbers. The DNC Registry permits calls to be made on behalf of political or charitabl e groups, for purposes of survey, and to individuals with whom the callers client enjoys a prior business relationship. An industry advocacy group, American Telese rvices Association (ATA), predicted a reduction of 2 million telemarketing jobs, although the U.S. Bureau of Labor Statistics counted only slightly more than 297,000 telemarketing employees at the time of the ATA statement. In the Tampa Bay region, an economic development professional stated the legislation would have little effect on local call center employment, due to the regi ons lack of telemarketing establishments. Prior to its replacement with the North Am erican Industry Classifi cation System (NAICS), the Standard Industrial Classification (SIC) lumped telemarketing in the category of Business Services, Not Elsewhere Classified (SIC 7389)along with industries such as parade fl oat decoration, wig styling, and baby shoe bronzing. When the government introduced the NAICS in 1997, telemarketing received its own code NAICS 561422. The Bureau of Labor Statistics (BLS) ES-202 dataset reportsmonthly telemarketing employment data from January 2001 forward, and state and county da ta on an annual basis. However, Floridas Agency for Workforce Innovation (AWI) makes available to CEDR the Enhanced Quarterly Unemployment Insurance (EQUI) database, which permits us to examine and report aggregated thus protecting sensitive data for individual firms from disclosure telemarketing employment data for Florida as well as the seven-county Tampa Bay region. Using January 2001 as a baseline, Chart T1 on the following page d isplays trends in telemarketing employment from January 2001 to September 2004 the latest date for which data is available for three regions: (a) the United States (less Florida), (b) Florida (less the Tampa Bay region), and (c) the Tampa Bay Region (Hernando, Hillsborough, Manatee, Pasco, Pinellas, Polk, and Sarasota counties). 11

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Chart T1 Telemarketing (NAICS 561422) Employment Index0.600 0.700 0.800 0.900 1.000 1.100 1.200 1.300J-01 A-01 J-01 O-01 J-02 A-02 J-02 O-02 J-03 A-03 J-03 O-03 J-04 A-04 J-04January 2001 = 1.00 DNC Registry Announced DNC Registry Opens DNC in Effect, Violators Face Fines US-FL FL-TB TB We noticed the 1s t Over the 3.75 years reported, telemarketing employment in the U.S. (less Florida) region has gradually declined to ab out 88% of its January 2001 level. Telemarketing employment in the Florida (less the Tampa Bay region) has fluctuated over the period of interest, but has lost less than 3% of its value. In the Tampa Bay region, telemarketing employment has declined precipitously si nce January 2001. In this time period, more than 1/3 of such jobs have disappeared. quarter (January-March) 2004 spike in telemarketing employment for Florida and Tampa Bay. Thorough an alysis of the individual firms and establishments (a firm may have more than one establishment) explains the spike. The upswing in telemarketing employment was due to new firms entering the market, whereas the downswing was due to fewer employees at existing firms. As it turns out, national telemarketing em ployment did not suffer a tremendous decline nor did like employment in the Tampa Bay region emerge unscathed, although in the la tter case telemarketing employment had been on a downward slide prior to the formal announcement of the DNC Registry. Both prognosticators predictions turned out to be inaccurate. Analysis of pre-announcement telemarketing data might have led to better forecasts of employment change due to the DNC Registry legislation. Chart T1 depicts three events relative to our analysis: the announcem ent of the DNC Registry, the opening of the DNC Registry, and the date the violators of the DNC Registry began to face fines. In the quarter after the DNC Registry announcement, telemarketing employment in all three regions declined, most dramatically in the Tampa Bay region. When the DNC Registry opened, U.S. (less Florida) and Tampa Bay regional telemarketing employment declined slightly in that qu arter, while Florida (less the Tampa Bay region) telemarketing employment increased. In the quarter following the enactment the penalty stage of the DNC legislation, employment levels in all three regions changed only slightly. 12

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The Impact of Medicaid Expenditures on Floridas Sales Tax Revenues By Dennis G. Colie, Ph.D., Director, Center for Economic Development Research The Florida Hospital Association (FHA) is a statewide organization repr esenting the interests of hospitals and health care systems. The FHA provides advocacy before the state legislature, Congress, state, and federal regulatory agenci es, and the court system. The FHA commissioned this analysis and USF CEDR sent its report of an alysis to th e FHA in March 2005. This article is a summ ary of that report, which is available in full at http://cedr.coba.usf.edu According to the U.S. Centers for Medicare and Medicaid Services, Medicaid is a program that pays for m edical assistance for certain individuals and families with low incomes and resources. This program became law in 1965 and is jointly funded by the Federal and State go vernments (including the District of Columbia and the Territories) to assist States in providing medical long-term care assistance to people who meet certain eligibility criteria Medicaid is the largest s ource of funding for medical and health-related services for people with limited income.1 In Florida, the States Agency for Health Care Ad ministration (AHCA) administers the Medicaid program, which is authori zed under Chapter 409, F.S., and Chapter 59-G, F.A.C. The program is funded through federal and state cost -sharing and with Florida counties contributing a portion of inpatient hospital care and nursing home services costs. Matching federal funds are contingent upon the States continued compliance with Title XIX of the Social Security Act and regulations in Title 42 of the Code of Federal Regulations. Eligibility for Medicaid participation is determ ined by one of two agencies: the Department of Children and Families for low income children and family programs and the institutional care program, or the Social Security Administration for aged, blind, or distinct requirements for eligibility. Performance-based program budgeting is used in ACHAs budget process to determ ine how established goals are being met in the use of public funds. Analysis of results for 58 separate measures is compared to legislated targets to judge the program efficiency.1 In 2003, average monthly caseload exceeded 2 million individuals. Budgeted expenditures of $12.5 billion were available for FY 2003-04. In this analysis, we estimate the fiscal impact of FY 200405 Medicaid e xpenditures on Floridas sales tax revenues. We use the REMITMPolicy Insight model to make our estimate of the fiscal impact. To implement the model we use the traditional counterfactual approach. That is, we virtually remove the projected FY 2004-05 Medicaid expenditures from Floridas economy and allow the model to find a new general equilibrium. The new general equilibrium takes into account the loss of continued circulation of the initial Medicaid expe nditures throughout Floridas economy. Then, we compare the estimated sales tax revenues at the new equilibrium with the projected sales tax revenues before removal of the projected Medicaid expenditures. Table 1 shows projected FY 2004-05 Medicaid expenditures. Th e basic data is from the February 25, 2005 Social Services Estimating Conference and provided to us by the FHA. Based on the description provided with the data, we can determine applicable indus try subsectors of the economy in which these funds will purchase goods and services. The North American Industry Classification System (NAI CS) was developed jointly by the U.S., Canada, and Mexico to provide comparability in statistics about business activity across North America and defines all categories of economic activity. We take the basic data, shown in the Expense column of Table 1 and allocate these expenses to various NAICS industry subsectors as shown in the columns to the right of the Expense column. This allows us to input the dollar amounts of disabled recipients. Each agency has separate and (Continued on page 16) 13

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Table 1 Florida FY 04-05 Projecte d Medicaid Expenditures MEDICAID SERVICES TO INDIVIDUAL S Service NAICS ExpenseNAICS 446NAICS 524NAICS 621NAICS 622NAICS 623NAICS 624NAICS 923 Case Management Services 621 $101,219,926 $101,219,926 Therapeutic Services for Children 621 $235,994,239 $235,994,239 Community Mental Health Services 621 $59,772,790 $59,772,790 Adult Dental Services 621 $14,517,907 $14,517,907 Dev Evaluation / Early Intervention Svcs 621 $3,599,931 $3,599,931 Early & Periodic Screening / Children 621 $127,261,066 $127,261,066 G/A Rural Hosp Financial Assist / DSH 622 $12,746,090 $12,746,090 Family Planning Services 621 $7,724,249 $7,724,249 Healthy Start Services 621 $13,634,401 $13,634,401 Home Health Services 621 $165,070,061 $165,070,061 Hospice Services 623 $218,870,458 $218,870,458 Hospital Inpatient Services 622 $1,999,907,739 $1,999,907,739 Hospital Inpatient Special Medicaid Payments 622 $582,196,096 $582,196,096 Regular Disproportionate Share 622 $226,923,978 $226,923,978 Freestanding Dialysis Centers 621 $13,434,427 $13,434,427 Hospital Insurance Benefits 524 $140,962,450 $140,962,450 Hospital Outpatient Services 621 $551,312,544 $551,312,544 Hospital Outpatient Special Medicaid Pymts 621 $8,383,501 $8,383,501 Respitory Therapy Services 621 $4,716,108 $4,716,108 Nurse Practioner Services 621 $5,341,798 $5,341,798 Birthing Center Services 621 $1,243,176 $1,243,176 Other Lab and X-ray Services 621 $45,687,802 $45,687,802 Patient Transportation 621 $112,690,977 $112,690,977 Physician Assistant Services 621 $2,128,163 $2,128,163 Personal Care Services 621 $21,472,458 $21,472,458 Physical Therapy Services 621 $17,844,485 $17,844,485 Physician Services 621 $666,766,804 $666,766,804 Physician Svs Special Medicaid Payments 621 $102,196,275 $102,196,275 Prescribed Medicine / Drugs 446 $2,617,296,082$2,617,296,082 Private Duty Nursing Services 621 $128,057,073 $128,057,073 Rural Health Clinics 621 $53,814,512 $53,814,512 Speech Therapy Services 621 $29,719,809 $29,719,809 MediPass Services 621 $28,860,500 $28,860,500 G/A RPICC DSH 622 $168,300 $168,300 Supplemental Medical Insurance 524 $603,660,421 $603,660,421 Occupational Theraphy Services 621 $21,777,436 $21,777,436 Clinic Services 621 $74,350,063 $74,350,063 Medicaid School Refinancing 923 $50,000,000 $50,000,000 Total Medicaid Services to Individuals $9,071,324,095$2,617,296,082$744,622,871$2,618,592,481$2,821,942,203$218,870,458 $0$50,000 ,000 14

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Table 1 (continued) Florida FY 04-05 Projected Medicaid Expenditures MEDICAID LONG TERM CARE Service NAICS ExpenseNAICS 446NAICS 524NAICS 621NAICS 622NAICS 623NAICS 624NAICS 923 Assistive Care Services 623 $32,917,835 $32,917,835 Home & Community Based Services 624 $777,778,695 $777,778,695 ALF Resident Waiver 623 $30,022,154 $30,022,154 Intermediate Care Fac./ Sunland Ctrs 923 $139,093,059 $139,093,059 Intermediate Care Fac./ Community 923 $199,057,315 $199,057,315 Nursing Home Care 623 $2,355,015,969 $2,355,015,969 Nursing Home Special Medicaid Payments 623 $11,069,716 $11,069,716 State Mental Health Hospital Services 923 $7,555,206 $7,555,206 Mental Health DSH 622 $68,635,186 $68,635,186 TB Hospital DSH 622 $2,444,444 $2,444,444 Community Supported Living Waiver 923 $21,408,819 $21,408,819 Nursing Home Diversion Waiver 923 $131,712,008 $131,712,008 Total Medicaid Long Term Care $3,776,710,406 $0 $0 $0$71,079,630$2,429,025,674$777,778,695$498,826,407 MEDICAID PREPAID HEALTH PLANS Service NAICS ExpenseNAICS 446NAICS 524NAICS 621NAICS 622NAICS 623NAICS 624NAICS 923 Prepaid Health Plans Elderly and Disabled 524 $694,200,692 $694,200,692 Prepaid Health Plans Families 524 $863,888,370 $863,888,370 Total Medicaid Prepaid Health Plans $1,558,089,062 $0$1,558,089,062 $0 $0 $0 $0 $0 EXECUTIVE DIRECTION & SUPPORT SERVICES Service NAICS ExpenseNAICS 446NAICS 524NAICS 621NAICS 622NAICS 623NAICS 624NAICS 923 Medicaid Fiscal Contract 923 $79,851,714 $79,851,714 TOTAL MEDICAID $14,485,975,27 7 $2,617,296,082$2,302,711,933$2,618,592,481$2,893,021,833$2,647,896,132$777,778,695$628,678,121 Key to NAICS codes: 446Health and Personal Care Stores (Retail Trade) 524Insurance Carriers and Related Activites 621Ambulatory Health Care Services 622Hospitals 623Nursing and Residential Care Facilities 624Social Assistance 923Administration of Human Resource Programs (Public Administration) 15

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(Continued from page 13) In summary, if FY 2004-05 projected Medicaid expenditures we re withheld from the economy, and without substitute funds, we estimate that Floridas total sales tax revenues would decline by approximately 2.19%, or a decrease of about $495 million. That is, we estimate that FY 2004-05 projected Medicaid expend itures will contribute $495 million to Florida in sales tax revenues. projected Medicaid spendi ng into appropriate R EMI model sectors. For example, NAICS sector 446 Health and Personal Care St ores and the REMI Retail sector captures Medicaid spending for Prescribed Medicine / Drugs. Table 2 Florida Sales T axes, reports the results of our analysis. Th e first column of Table 2 lists the type of sales tax. The second column reports the models FY 2004-05 projected sales taxes with Medicaid spending at its projected FY 2004-05 levels reflected in Table 1. The third column reports estimated sales tax revenues without the projected Medicaid spending. An imp licit assumption is that ENDNOTES i See http://www.cms.hhs.gov/medicaid/default.asp? ii From The 2003 Annual Report on Medicaid Outcome Measures AHCA, September, 2003, found at http://www.fdhc.state.f l.us/Med icaid/deputy_secretary/recent_pre sentations/2003_Medicaid_Outcome_Measures.pdf Medicaid recipients do not s ubstitute funds from other sources, such as savings or local governments, to continue heath care services that would otherwise be paid for by Medicaid. To the extent that there is such substitution the loss of sales tax revenues may be less than reported here. The fourth column of Table 2 shows the difference in sales tax revenue s in dollars, and the fifth colum n shows the difference expressed as a percentage of total projected sales tax revenues (including sales tax genera ted by the projected FY 2004-05 Medicaid expenditures). Table 2 Florida Sales Taxes Projected Estimated Difference Difference with Medicaid Spending without Medicaid Spending w & w/o Medicaid Spending as % of Projected FY 2004-05 FY 2004-05 FY 2004-05 FY 2004-05 Type (2004 $) (2004 $) (2004 $) General Sales Tax $17,591,000,000 $17,188,000,000 -$403,000,000 -2.29% Motor Fuel Sales Tax $1,944,000, 0 00 $1,908,000,000 -$36,000,000 -1.85% Alcoholic Bev Sales Tax $694,000,000 $681,000,000 -$13,000,000 -1.87% Tobacco Sales Tax $593,000,00 0 $589,000,000 -$4,000,000 -0.67% Public Utility Sales Tax $770,000, 00 0 $754,000,000 -$16,000,000 -2.08% Other Sales Tax $988,000,000 $965,000,000 -$23,000,000 -2.33% Total Sales Taxes $22,580,000,000 $22,085,000,000 -$495,000,000 -2.19% 16


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