Detroit App Jobs Make Up Growing Part Of Economy
A study released Tuesday shows Detroit's job market got a boost from from an unlikely source: apps.
TechNet, a bipartisan group that promotes policy affecting the technology industry, sponsored a study that shows the impact of app-related jobs on the economy, taking data from the the last three months of 2011.
Detroit didn't make the top 10 list, but TechNet found 1.1 percent of the Detroit-Warren-Livonia metropolitan statistical area's jobs come from the "app economy."
That might not sound like a lot, but the study makes the point that the app industry only got started in 2007. In just more than four years, creating any jobs -- an estimated 466,000 nationwide -- reflects a big jump.
The TechNet study also estimated jobs created by the app economy outside the technology sector, but makes clear app development is too new a field to make real predictions about future economic impact. Still, TechNet's Vice President for Policy Research John Horrigan said the study suggests the new app economy is increasing, with a 45 percent jump in want ads for app jobs from 2010 to 2011.
"It's clear it's likely to be a fast-growing part of the tech ecosystem because more and more people are adopting smartphones," Horrigan said. "The ecosystem is going to mature to help spur the demand for apps."
And Detroit's app jobs compare well to other markets. Horrigan noted Detroit has the same percentage of app jobs as Phoenix and Austin, two cities considered to have a high concentration of technology businesses.
"It does suggest a vibrancy to the Detroit economy that's promoting people to have a demand for apps and seek out jobs in that area," Horrigan said. He noted the low start-up costs for app businesses and the flexibility for locating jobs contributed to a move away from traditional tech hubs like Silicon Valley.
"Because all they need is a computer ... they can also be located near companies that might have a certain demand for apps," Horrigan said.
Nathan Hughes, co-founder of the app-developing company Detroit Labs, said he receives calls every day from companies looking into apps for the first time. But despite the uptick in demand, Detroit still has more talented app developers than jobs to support them, meaning they often leave town looking for work.
"There's a huge talent pool in Michigan and a lot of competition urging them to leave the state," Hughes said. Retaining talent is one of the reasons he started Detroit Labs, which employs more than 15 people.
While apps might call to mind Angry Birds and other mobile games, Hughes said Detroit Labs looks beyond the "toy app." The overall app market is much wider, and includes development for health and medicine, as well as the auto industry -- both fields that may continue to play a role in the Detroit's growing app economy.
Hughes said the proximity of the car companies and their demand for innovation creates a great breeding ground for app developers. Detroit Labs recently worked on Chevy's Game Time app, released for the Super Bowl. The developers' ability to meet face-to-face with Chevy personnel was one of the reasons Detroit Labs was picked for the project.
"We win a lot of business on being based here," Hughes said. "I definitely believe in working local and finding local partners wherever possible."