Knowledge Workers

Washington Post staff writer Kim Hart hosted Steven W. Pedigo, the Greater Washington Initiative's research director, to discuss the area's knowledge workers. In an article today, Kim writes that a marketing study portrays Washington as a hub of "knowledge workers" that are attractive to many businesses.

Related coverage examines the area's advertising, information technology and health care sectors.

A transcript follows.

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Kim Hart: Thanks for joining us today to talk about the Washington D.C. area's "knowledge workforce." Steven Pedigo, who led the research for the report by the Greater Washington Initiative, is here to answer any specific questions you may have about different fields, or the region in general.

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Alexandria, VA: I completely agree that this area is a magnet for "knowledge workers" and is much more diverse than people (even locals) think. But the 20 and 30-somethings that are in the "knowledge workforce" are still having a hard time affording homes in the area even though they are considered "white collar". This could make it hard to attract new graduates and those wanting to start families (and have to go to one income, even for a short period of time). Do you see any progress being made in this area?

Steven W. Pedigo: You're right - one of the toughest externalities of the knowledge economy -- a high cost of living. But, if you look at all successful regional economies across the country - New York, Boston, San Francisco -- they're all facing this issue. When a place becomes more desirable, prices go up. Let's be honest, the high housing values of New York or Greater Washington have not kept young graduates out of the city.

In fact, Greater Washington is one of the leading metros on the brain gain index, which measures which regions are successful at attracting and retaining young talent.

That being said, regional leaders can implement soft policies to control the escalating prices. You can find some evidence of this with the District's stance on having a percentage of affordable housing units in new condo buildings. But let's be real. Trying to keep affordable housing in a desirable area is an issue that no one has figured out.

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Washington, DC: Why do you think it is that this area is having such a hard time attracting nurses? We seem to have plenty of IT consultants, bankers, etc. But the baby-boomers are about to start retiring en mass and we're going to need nurses more than ever!

Kim Hart: Nursing is a very high-stress job, and people in that profession are asked to work long-hours, nights, weekends, blizzards, holidays. It seems a lot of people are leaving the profession due to sheer burnout, and young people aren't as willing to go into a profession that requires that type of sacrifice. The glamorous jobs--technology, finance, etc.--seem to be where the college students are going.

Steven W. Pedigo: You're right a lot of people are getting old. Just kidding. I think a lot of the shortage comes from the high cost of living in this area, coupled with the national shortage. More and more, students are being encouraged to complete 4 year college programs, leaving a lot of associate level professions off their radar.

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Taxation Without Representation: The GMU student in the IT story put a tension between staying in the DC area and "finding innovative work." Is that a fair perspective on the region's IT sector?

washingtonpost.com: INFORMATION TECHNOLOGY: With Skills (and Clearance), You'll Choose Your Job

Steven W. Pedigo: It's clearly a common perspective about Washington's IT sector, but I am not sure it is completely accurate. Generally, when people think of Washington's technology workforce, it is characterize as it services or consulting, while places like San Jose or Austin are characterized as regions focusing on computer programming and design.

Interestingly, we found in our study that Greater Washington's information technology sector is about 50/ 50 - 50% computer design/ programming and 50% IT services. Also, Inc. 500 reported that 31% of the IT companies on the fastest growing firms list were located in Greater Washington. Given this, there has to be some entrepreneurialism and innovation going on in these companies. To the defense of IT companies here in Greater Washington, the larger public may not hear of the innovative government projects that are going on here that you might hear about if it was a project by Google, etc.

Kim, what's your take from your conversations?

Kim Hart: I think the IT field here in Washington faces the same mis-conceptions that other fields do. Everyone thinks it's consulting for government agencies or working in "stodgy" contracting firms.

I heard from Mike Gagnon, who I profiled, this morning and he mentioned that he's already gotten several e-mails from local companies who do security research and other more "innovative" things--from his stance, anyway. There are a lot of interesting start-ups here and divisions of large companies doing things that the general public is not aware of. Apparently, people actually working in the IT field may not be aware of them either.

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Washington, DC: Steven -- did the study look at differences within the region, for example between the District and the suburbs, as to where knowledge workers are located (and which sectors are locating where)?

Thanks

Ken Jarboe

Steven W. Pedigo: Ken - We can break the data down to the metropolitan division level but not any further because we used Bureau of Labor Statistics occupational data, which is only available on the metro level.

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Washington, D.C.: I wanted to thank Mr. Pedigo for what must have been an enormous amount of work. And ask if he has plans to do additional reports like this about the DC area.

Steven W. Pedigo: Thanks. We appreciate your thank you. A lot of folks here at GWI worked really hard on the report. In addition to our regional report, we plan to take a look at Greater Washington's service sector this year as well.

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Fairfax, VA: In the advertising article, Kim Hart writes that many of the people hired at a Georgetown firm come to the area because a spouse was transferred here, not because they thought it would be a great place to launch an advertising career.

What's being done to change that perception, which I believe is prevalent in a lot of fields?

Kim Hart: It seems that this perception has carried over from a few decades ago, when there wasn't as much industry here, especially in the media industry. It's something industries are tackling on several fronts: changing the perception that there's nothing but federal workers and government contractors here, spreading the word about the changing landscape to other cities where workers will come from, and selling their own firms as a cool place to work.

I think industries will have to go about changing their image however they think it will best suit them. That may be recruiting on college campuses. Some advertising firms are hiring big-name partners from other big-city firms, and they are then recruiting workers through their personal networks.

Steven W. Pedigo: You're right that this is a common misperception even though Greater Washington has led the nation in job growth over the past five years. From 2000-2005, the region added over 270,000 new jobs; Miami was second with 208,000 jobs but most of those were in construction and temporary jobs.

Hopefully, studies like the one GWI released today and news coverage will start to correct perceptions.

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washingtonpost.com: In the comments area of 'Not Just a Government Town,' a reader named Joe writes:

"As far as I am concerned, DC will still be just a government town until it attracts the banking and finance industry. Maybe these guys want to stay as far away from all these regulators as possible."

Steven, what are your thoughts on the region's banking and finance industry?

Steven W. Pedigo: Good question: Greater Washington already has a banking and finance industry, but it fights some of the same misperceptions that the region's IT sector battles.

Here's an interesting fact:

More business and finance than legal professionals: Within professional services, the region's largest category of knowledge workers, there are 100,000 (or 2.65 times) more people providing business and financial services than legal services in Greater Washington.

Kim Hart: Lawyers are still in high demand, though. As the study states, "Greater Washington will need to add approximately 20,000 legal workers to maintain the sector's growth and replace those leaving the workforce."

The common thread across all these industry sectors is that demand is high for all of them. That may not be surprising in an area that has relatively low unemployment rates. Even the demand for recruiters to help find these employees is high.

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Washington D.C.: Does your study only include knowledge workers that physically reside in the Greater Washington area? There are many knowledge workers that contribute to our economy but commute into the area from other regions.

Steven W. Pedigo: Our study includes workers who are working in Greater Washington.

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Smarty pants : The article makes reference to people working in the arts but doesnt mention any of the findings. What are some findings for the arts workforce?

Steven W. Pedigo: Glad you asked!

Here are a few of our key findings:

In Greater Washington, there are 72,450 professionals in media, arts, and design; nearly 40% of whom (28,510) are self-employed.

Greater Washington's commercial arts workforce employs more than 6,500 residents and has grown at an average of 8% - 8 times the national average - since 1999, adding more than 1,600 workers. Greater Washington also has more than 8,000 residents self-employed in the arts.

Greater Washington has more commercial design workers per capita (316 per 100,000 residents) than any leading metro area.

With approximately 5,600 editors in the region, Greater Washington has three times the national average. While Greater Washington trails New York (16,270) in sheer numbers, the region has the highest concentration of editors of all leading metro areas. For every 1,000 residents, Greater Washington has 111 editors, compared to 89 for New York.

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washingtonpost.com: In the comments area of 'Region's Boom Magnifies Lack of Nurses, Technicians,' a reader writes:

"I am a registered nurse, working in critical care. I would like to address the nursing shortage issue, being a nurse who will leave the profession at the first available opportunity. Being a nurse is the worst, most grueling and punishing job I have ever had. Burn out is high. The RN is sorely abused, by hospital administrators, physicians and patients alike. We are poorly paid relative to what we contribute and the responsibility that we bear. Work hours and conditions are deplorable. ... "

What can be done to address those concerns?

Kim Hart: I actually heard from a nurse from Maryland this morning who raised similar concerns. She said the long shifts--usually 12 hours--contribute to a lot of the problems. After 8 hours of working, nurses get so worn out that mistakes are more common and fatigue really starts to set in. That drives people out of the profession and discourages people from entering it.

Her take on the situation: there aren't enough qualified nurses out there who are actually working--they've left the field after burning out. She thinks health-care experts need to get involved to find a solution.

The nursing shortage is a national issue, so cities across the country are dealing with this. Robert Templin, the president of Northern Virginia Community College, said some of the local universities he's working with are trying to make it easier for people from other fields to get the necessary degree and training in order to move into nursing. From what he says, nurses can make decent salaries--and signing bonuses are sometimes involved.

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c-student (go hoyas!): Who cares about knowledge workers? Why does this matter?

Steven W. Pedigo: Here are the basics:

Knowledge workers are the future of regional economies as we experience a shift to a services oriented economy.

Generally speaking, regional economies that have a higher percentage of knowledge (creative) workers have a GRP per capita (for every 100K residents) that is 20% higher.

In addition, median household incomes for regions with higher concentrations of knowledge workers are about 21% higher. These percentages are even higher for Greater Washington.

There's a great chart about this on our executive summary: greaterwashington.org

Kim, what's your take on this?

Kim Hart: Basically, this study is trying to send the message to employers that this area is a good place to be doing business because there is access to a very educated workforce. That, in turn, should attract even more workers to fill the gaps that we have in certain sectors.

I spoke with Richard Florida, who promotes the "creative class" and is a professor at George Mason University. He said that, as the area has grown, Washington is now competing on a global scale for companies and workers. Having this creative class (which is another phrase for knowledge worker), he thinks, will make Washington a "world capital" : a place with architecture, parks, arts and entertainment, and a general culture that can compete with the likes of London, Toronto, Shanghai.

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Chicago. IL: This seems like a lot of self serving nonsense. A way to play "rah-rah" booster for a particular region and garner more attention to itself. I would like to see some hard numbers from this study. I lived in D.C. and currently reside in Chicago. Honestly, I don't notice any palpable difference in the make up of the work force (except there are more government workers in DC). It seems to me that most large metro areas all have the so called knowledge workers at their core. After all, its theses same workers that run the legal, finance and business community.

Steven W. Pedigo: Please feel free to download the study at greaterwashington.org.

In the study, you will find valid data comparsions between all metros we selected, including Chicago.

Greater Washington vs. Chicago

Median Household Income:

$74,710 - GW

$54,710 - Chicago

BA and Higher %

45.9% - GW

32.1% - Chicago

Knowledge Workers per 100K residents

18,680 - GW

12,620 - Chicago

Clearly, there's an advantage for regions that have a higher concentration of knowledge workers.

Kim Hart: Clearly, most big cities with robust economies are going to have large concentrations of these knowledge workers. After all, that's why Fortune 500 companies do business there. That's why workers go there--for the opportunity.

Yes, this is an effort to tout Washington's workforce. But it's also an opportunity to look at the characteristics unique to this area, as well as pointing out that we are not immune to national labor issues, like in nursing and accounting.

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Bowie, MD: Your article today didn't cover pay though, why?

Also, most of the innovative and creative IT/CS jobs are in Silicon Valley and Washington State, not there. With the dot.com bubble, few firms now are allowing their employees to "live it up" like Google.

Steven W. Pedigo: In the study, you will salary comparisons for occupations and sectors. But, here's a look a look at the average IT salary:

'The average salary for Greater Washington's technology workforce is $78,524 annually, compared to $80,491 for New York City and $72,069 for Los Angeles. The average salary for those in computer design and programming is $87,892 compared to the $69,807 for IT services.'

Great comment about other benefits, but as you can imagine, that's difficult to quantify for comparison.

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Washington, D.C.: So now that we know DC has a knowledge worker economy, how do we use that to affect the unemployed?

Steven W. Pedigo: With one of the lowest unemployment rates in the country, it's better to be unemployed in Greater Washington than in some other places across the country. Employers are hungry for talent. If you're educated and have a generalist set of skills, you're very employable.

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washingtonpost.com: Archive Coverage: The City as Modern Muse (Monday, September 18, 2006)

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Arlington, VA: The study found that the region has plenty of physicians and pharmacists with advanced degrees, but not enough workers in professions that require two-year associate degress.

That doesn't seem surprising. How can those workers afford to live in this region? Why shouldn't they just move to a more-affordable area, where their skills are also in great demand?

Kim Hart: I spoke to several regional economists for this story, and they all pointed out the very same thing. This has happened all over the place, especially during the housing boom. It is definitely an issue that local leaders and policy makers will need to address more aggressively.

That's why this development in this area is sprawling. People are moving father out--and enduring two-hour commutes--to live in a place they can afford.

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U Street, DC: Do you have data comparing the percentage of local workers employed by gov't/contractor vs. private/non-profit in any particular industry? If so, how does DC compare to the other metro areas in this regard? This would be a nice way of quantifying just how much effect the federal gov't has on our economy versus those other locations. Specifically, I'm interested in the science workforce. Given the presence of NIH, FDA, etc.; I'm curious how many local research scientists actually work for private employers. Thanks.

Steven W. Pedigo: About 11% of the region's employees work for the federal government. About 80% work for private employers and the remaining 9% work for local governments.

Also, the point of this study was to examine the skills of the region's workforce looking at the occupations they have. Many studies simply look at where people work because it's easier and faster. But this study actually looks at what people do, regardless of where they work. And it includes (except in the comparisons to other regions) self-employed knowledge workers.

Besides, many of those federal analysts and researchers have the same education background as the private sector analysts...and are able to work in both environments.

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Anonymous: I read something recently about the 're-branding' of DC that's being discussed now. Namely, a new slogan/advertising campaign to market to tourists thinking of visiting the area. Was your study intended to help with this in any way? And, would any data from your study be useful for this purpose?

-Adam

washingtonpost.com: Washington, D.C.: [New Slogan Goes Here] (Sunday, March 25, 2007)

Steven W. Pedigo: GWI is involved with some of those discussions; Tim Priest, our executive director, is serving on the taskforce. I suspect some of the findings will be taken into consideration, but the branding exercise more about Washington as a place to visit. GWI promotes Greater Washington as a business destination.

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Steven W. Pedigo: Thanks everyone for your questions. Also, I want to thank Alan Smith, GWI Communications Manager, who joined on the chat.

If you have questions about GWI's study, you can email me at stevenpedigo@bot.org.

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