Philly’s tech employment declined in 2021 amid ‘a big reshuffling’

While economists and labor researchers will be parsing out the effects the COVID-19 pandemic had on the Philadelphia region for years to come, some new information shows that after a boom of tech jobs in 2020, 2021 might not have been as strong.

A recent report from the Economy League of Greater Philadelphia shows that after steady growth of the region’s tech workforce over the last decade, in 2021, tech employment declined across many metro regions, including Philadelphia. Employment numbers were consistently up from 2019 to 2020, but declined about 9,600 jobs from 2020 to 2021 — a nearly 7.5% drop. In 2020, tech made up about 4% of Philadelphia’s workforce, and represented 3.7% in 2021.

The Philly region isn’t too special in this aspect: Tech employment dropped in all of the US’s top 15 metropolitan areas, though at a smaller margin.

The report is contrasts a bit with a recent CompTIA report measuring tech jobs growth in the US, and showing that the Philly region had grown and was poised to grow (modestly) in 2022. It’s mostly a difference in methodology, said Mike Shields, the Economy League’s research director, as CompTIA draws a wider net for tech jobs than the local organization does.

In 2021, we saw a lot of industries recalibrating, as well as a movement of labor — aka the Great Resignation — after many workers felt burnt out, pushed out or unemployed because of the pandemic. Though tech wasn’t as vulnerable to layoffs, some folks likely looked at their circumstances and wanted to reconsider their options.

“I think 2021 was a big reset for a lot of industries. I think a lot of people looked at their circumstances and felt they could do better,” Shields told Technical.ly. “So maybe they’ve left their job, and someone has yet to fill it.”

Along with the healthcare industry, tech saw some of the highest quitting and turnover rates in the increasingly competitive market from 2020 to 2021, the Economy League’s report found. At the same time, tech jobs saw extreme increases in demand at the onset of the pandemic, which likely led to increased workloads and burnout. Shields added that the workforce loss via death, early retirement or other pandemic-related factors are a factor in the scattered labor numbers from 2021.

Data from the Economy League’s report also shows some interesting regional insight: More tech workers live outside the city. In 2020, tech workers made up 2.6% of Philadelphia’s workforce, but in the nearby Montgomery and Chester counties, tech workers made up 5% and 5.9% of the workforce, respectively, despite having about half the population. Delaware County had 3.7% and Bucks County had 3.9%, the report also showed.

But that draw to the suburbs might be the key to growth, Shields said, as major corporations are realizing that the Philadelphia region is a “diamond in the rough” of sorts for people who may be getting priced out of other tech hubs or are looking for work at corporate giants like Comcast or Vanguard. While the decline in 2021 could be jarring, Shields says (similarly to CompTIA’s report) that we’ll likely see minimal to moderate growth in the next few years.

“It’s looking like a downturn, then upturn,” Shields said. “This isn’t a sign Philly’s losing its tech sector, it’s a big reshuffling.”