State trails in tech areas

Survey finds Maryland below national average in several respects

August 31, 1999|By William Patalon III | William Patalon III,SUN STAFF

With its highly educated work force, blue-chip research universities and billions of dollars in federal research-and-development dollars, Maryland's high-technology sector has the seeds for years of vibrant growth.

But several bothersome trends show the state still has a ways to go in harnessing these resources if it is to emerge as a national and international force in the technology arena, a new study shows.

"I like what I see happening, and will be happening," said William Tumulty, a manager of external alliances and strategic partnerships at Goddard Space Flight Center, and co-chair of the Maryland Technology Alliance, the organization that sponsored the study.

The alliance is a partnership of companies, federal and state government agencies and area universities who hope to create new companies and new jobs in Maryland by fostering the creation and commercialization of new technologies. Its findings will be put to use by the newly chartered Maryland Science Engineering and Technology Development Corp., whose charge it will be to induce cooperation between the public and private sectors to transform research into revenues within Maryland.

"Our challenge is to have our technology economy perform as extraordinarily as the wealth" of money, research and skilled workers available, said Marsha Schachtel, senior fellow at the Johns Hopkins Institute for Policy Studies, who conducted the research.

The study is the first comprehensive review of Maryland's vaunted technology sector, which has only come to prominence in the last half of this decade.

A lack of strong technology companies delayed the state's emergence from the early 1990s recession, economists say.

Because of that view, there were some surprising findings.

For instance, while Maryland has a noted presence in biotechnology, pharmaceutical shipments from state firms are growing at only one-third the national average. And even with its emergence as a player in the market for telecommunications equipment, and though shipments are growing faster than employment, they are slower than the national average, the study found.

In a number of other areas, Maryland not only trails some of its East Coast high-technology peers -- Pennsylvania, Massachusetts, Virginia and North Carolina, for instance -- but the national average.

For example, as an exporter the state is well below its peers and the national average, though service industries comprise the biggest share of Maryland's technology sector.

However, Schachtel noted that the most recent data available in many cases ended with the 1996 year. By contrast, companies such as telecommunications-equipment maker Ciena Corp. and several biotechnology firms have only come to the fore in the past few years, she said.

Even with the older data, the study found Maryland has significant assets to help its technology businesses grow.

The state is one of the nation's most focused on research and development, with spending equaling nearly 5 percent of its economic output. The state's proximity to Washington and the many agencies located here give it access to billions in federal R&D money.

It is a wealthy state, with a per-capita income 13 percent higher than the national average, and pays its high-technology workers well -- one logical reason it's able to add educated workers to those already here.

Research-oriented universities like Johns Hopkins and the University of Maryland add to that prestige, the study concluded.

"This is really a picture of opportunity," said Theodore Poehler, vice provost for research at Johns Hopkins, and co-chair of the study's sponsor, the MTA. "Maryland already has a robust high technology economy, but the potential is there for tremendous growth in the future."

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