Pittsburgh can boost wages by investing in the digital skills of workers and businesses, study says
Jobs across the economy continue to require more computer skills, and a new study shows that the “digitalization” of work in the Pittsburgh area mirrors national trends.
The Brookings Institution reported last week that, while the average job in the Pittsburgh metropolitan area involves a medium level of digital technology usage, the share of jobs that rely on digital platforms has increased markedly over the last two decades.
“Pittsburgh is a very solid performer that has made progress in adopting digital tools. And that's good for its people and good for its firms. But there's more work to be done,” said Brookings Metro senior fellow Mark Muro, who co-authored the new study.
The research shows that the average earnings for jobs that involve a high level of digital skills reached $79,000 nationally in 2020, compared to $54,000 for medium-skill positions and $35,000 for low-skill ones. Between 2010 and 2020, the report said, the wage premium for high-level digital work over middle tier jobs rose from 41% to 47%, even when controlling for educational requirements beneath the doctoral level.
“The presence of digital skills correlates with the productivity and income of people, firms and places,” Muro said. “People and places that have these skills begin to prosper more than others.”
But the report notes that gaps in training opportunities and computing infrastructure can further solidify economic disadvantages for less populous areas and racial minorities because they tend to lack access to such resources.
“Digital [technology] is a main way that people and places can connect to the broader economy,” Muro said. “It’s a connection to consumers. It’s a connection to employers. It’s a connection to skills that are rewarded and then the training that is provided within companies. If [a region] isn't there in the first place, [it] can fall behind further.”
The study assigned each state and metropolitan area an average digitalization score between 1 and 100 based on the composition of their respective labor forces. The metric captures the level and importance of digital systems in specific jobs. The technology covers a broad range of tools, including email, word processing software, Excel spreadsheets, Skype, and Slack. To make its calculations, Brookings used data from a survey the U.S. Bureau of Labor Statistics conducts with workers in occupations that cover 98% of the nation’s workforce..
Scores of 60 or higher denoted a high degree of digitalization while ratings between 34 and 59 captured medium-level skills.
One in every four jobs in the U.S. received 60 or more points. About half were in the medium digitalization range, while the remaining quarter scored 33 or fewer points. Two decades ago, by contrast, half of jobs involved a low level of digital skills.
The workers who have experienced the greatest increases in digitalization since then include construction supervisors, medical assistants, police officers, and high school teachers, according to Brookings.
In the Pittsburgh metro area, the average digitalization score was 48.3 in 2020, virtually the same as the national average and a notable increase over the region’s score in 2010 of 44.5. The 2020 score marked a 49% increase over 2002, when the region posted a rating of 32.4.
Pennsylvania as a whole followed a similar trajectory, with the lowest scores emerging in the Chambersburg-Waynesboro, Gettysburg, and Lebanon metro areas. State College rose to the top with a score of 50.5.
Muro noted that university towns usually receive high ratings because their residents tend to achieve high levels of education attainment. But generally, the study found, regions with smaller populations usually achieve lower rates of digitalization than large metro areas such as Pittsburgh.
Nationally, the highest-scoring regions in 2020 included Boulder, Colo., Silicon Valley, and Washington, D.C., while Elkhart-Goshen, Ind. and Twin Falls, Idaho received the lowest scores.
Within communities, the report found, men remain overrepresented in highly digitalized jobs such as engineering and in occupations such as construction, which have low levels of digitalization. Women, meanwhile, account for about three-quarters of medium-digitalization jobs such as office administration, education, health care, and social services.
With the exception of Asian Americans, people of color remain significantly underrepresented in positions that require a high degree of digital tech usage.
In its report, Brookings advocates for “place-based” strategies to accelerate digital skill-building and economic development. It names companies, philanthropies, and government agencies that have funded local initiatives across the country to promote innovation and workforce development. The entities include the Ewing Marion Kauffman Foundation, the National League of Cities, JPMorgan Chase, and Microsoft. (Microsoft helped to fund Brookings’ research.)
The federal government has backed additional efforts, awarding a $63 million grant to southwestern Pennsylvania last fall as part of the U.S. Commerce Department’s Build Back Better Regional Challenge. The money will support efforts to deploy robotics technology at local businesses.