The software industry's impact on the US GDP is massive, accounting for some $1.14 trillion in 2016, according to a Tuesday report from Software.org: the BSA Foundation. What's more, the industry boosted the economy in all 50 states.
According to the report, that impact on the GDP marks a $70 billion increase over the past two years. While the US economy as a whole grew 6.7%, software's direct economic impact grew by 18.7%, the report found.
Jobs were also heavily impacted by the software industry. Some 2.9 million people in the US are directly employed in software, but the industry indirectly supports 10.5 million US jobs. That marks a 6.5% growth since 2014, the report found. Overall US employment grew 3.9% in the same time frame.
SEE: Software quality control policy template (Tech Pro Research)
"These gains extend far beyond the software industry; they create a ripple effect that magnifies opportunities and job growth in every industry across the country," Victoria Espinel, president of Software.org, said in a press release.
As noted, all 50 states felt some impact from the software industry. However, 35 states saw GDP growth of more than 20% in 2016. Software industry employment grew fastest in Kansas, Mississippi, Indiana, Idaho, and Louisiana, the report noted.
And these jobs pay well, too. The report pegged the average annual salary for software developers at $104,360 in 2016, more than double the average annual wage for all US jobs, which was $49,630 that year.
Software companies are also investing a lot in research and development (R&D). In 2016, the report said, software companies spent $63.1 billion on R&D investment. That accounts for 19.6% of all domestic business R&D in the US.
"The continued growth, vitality, and innovation of the software industry depends on policies that encourage continued innovation and investment," Chris Hopfensperger, executive director of Software.org, said in the release. "A thriving innovation ecosystem, in turn, will provide smarter opportunities for growing our economy, protecting the environment, boosting education, and improving public safety."
The 3 big takeaways for TechRepublic readers
- The software industry has contributed a total of $1.14 trillion to the US GDP, with its direct contribution hitting $564.4 billion, according to a Software.org report.
- Software boosted the economy in all 50 states, indirectly supporting some 10.5 million jobs in 2016, the report said.
- Software companies spent $63.1 billion on R&D investment, accounting for 19.6% of all domestic business R&D in the US in 2016.
- Digital transformation: A CXO's guide (TechRepublic)
- 7 most important tech jobs needed for today's digital enterprise (ZDNet)
- IT and software jobs leading growth of tech sector in US (TechRepublic)
- Why the hottest technology job this year may be scrum master (ZDNet)
- The 10 best tech jobs that pay the highest salaries (TechRepublic)
Conner Forrest has nothing to disclose. He doesn't hold investments in the technology companies he covers.
Conner Forrest is a Senior Editor for TechRepublic. He covers enterprise technology and is interested in the convergence of tech and culture.