US tech industry to take up new technology sector

The US tech sector is set to take on new industries as it seeks to reinvent itself as a digital service industry.

The US Office of the Secretary of Commerce, the nation’s economic advisor, has announced the US will seek to create a new research and development and technology sector in its economic development budget.

According to the Office, the US is the fourth largest source of foreign direct investment (FDI) into the US technology sector, with US firms making up about 12% of all technology companies.

The proposed $300m programme, the first such initiative of its kind in the US, would include the development of technology-based solutions to help businesses achieve better business outcomes, the OSC said.

The initiative, dubbed the Digital Services Infrastructure Initiative, would work in partnership with the private sector and local governments to develop a new generation of technologies to help small businesses, small and medium sized businesses (SMEs) and internet-based companies achieve the right business outcomes.

The new services sector will include an array of new technologies, including cloud computing, cloud-based applications, remote access solutions and distributed systems, the Office said.

“The US will invest more than $300 million over the next two years to invest in new services sectors to accelerate growth, create jobs and support economic opportunity for US small businesses and SMEs,” said OSC secretary of commerce Wilbur Ross.

“By creating the next generation of services, this investment will create more than 10,000 jobs in the next four years, which will be a critical driver of our economy.”

The new US industry would include a range of services to support the digital services sector, including the cloud computing and distributed computing sectors, the office said.

While the US tech economy is growing, so is the need for infrastructure to support IT.

The OSC is seeking to develop innovative ways to connect the services industry to the nation, including developing an economic incentive for businesses to locate in key locations in the country, the department said.

According the Office of National Drug Control Policy (ONDCP), the US was the sixth largest destination for international drugs in 2017, and the second largest destination in 2018.

Its latest data shows the country’s economy expanded by 2.7% in 2018, with gross domestic product growing by 3.6% in that same year.

Its unemployment rate stood at 6.2%, down from a peak of 8.4% in November 2017.

The OSC has proposed an additional $2bn to support small businesses with new technology solutions, including training programs and incentives for small businesses to hire IT specialists, the federal government said.