Content area
The information sector in Arizona is smaller than the national average on measures of per capita receipts and per capita employment. Each industry group within this sector - broadcasting and telecommunications, publishing, information and data processing, and motion picture and sound recording - was smaller in Arizona. In addition to the information sector, the professional, scientific and technical services and the arts, entertainment and recreation sectors are reviewed. Data are available for Arizona for 10 of 18 sectors from the 1997 Economic Census. The information sector is the third for which national figures have been released.
Full text
The information sector in Arizona is smaller than the national average on measures of per capita receipts and per capita employment. Each industry group within this sector broadcasting and telecommunications, publishing, information and data processing, and motion picture and sound recording - was smaller in Arizona.
In addition to the information sector. the professional, scientific and technical services and the arts, entertainment and recreation sectors are reviewed in this article. Data are available for Arizona for 10 of 18 sectors from the 1997 Economic Census. The information sector is the third for which national figures have been released.
INFORMATION
The information sector was newly created in the North American Industry Classification System (NAICS) from pieces of the manufacturing, TCPU (transportation, communications and public utilities), and services divisions of the old Standard Industrial Classification (SIC). Compared to the other NAICS sectors for which data have been released, Arizona's information sector is relatively small with 1,731 establishments employing 42,238 and receiving $7.2 billion in receipts in 1997.
Sectoral Detail
Four subsectors comprise the information sector (see Table 1). Broadcasting and telecommunications contributed the largest shares of establishments, receipts and employment in Arizona in 1997. Its average establishment size, receipts per employee and payroll per employee also were the highest of the four subsectors. Telecommunications was the largest of the three industry groups within this subsector in number of establishments, employment and receipts. Receipts per employee were especially high in the telecommunications industry group. The cable networks and program distribution industry group consisted of three cable networks and 49 establishments performing program distribution. The radio and television broadcasting group consisted of 12 radio networks, 101 radio stations and 29 television broadcasting establishments.
Publishing, the second largest of the four subsectors, consists of two industry groups: newspaper, periodical, book and database publishers, and software publishers. Software publishers was the smaller of the industry groups, but paid considerably higher wages and realized somewhat higher receipts per employee.
The information and data processing subsector was considerably smaller. While its average wage was only a little lower, its receipts per employee were much lower than in the publishing and broadcasting and telecommunications subsectors. The size of the data processing services industry group substantially exceeded the information services group. The latter consists of news syndicates, libraries and archives, and other information services such as Internet service providers.
The motion picture and sound recording subsector paid very low average wages and realized low receipts per employee. The motion pictures and video industry group, consisting of production, distribution and exhibition industries, made up most of the subsector. In Arizona, the exhibition industry, consisting of 101 motion picture theaters, accounted for 80 percent of the group's employment.
Geographic Comparisons
The information sector in Arizona in 1997 was of below average size considering the state's population. Per capita receipts were only 67 percent, and per capita employment 80 percent. of the national average. Arizona's per capita figures were less than the national average in every subsector and industry group. The radio and television broadcasting and telecommunications industry groups were closest to average at about 95 percent of the nation's per capita employment, but only 83 percent of its per capita receipts. The sound recording and information services industry groups had per capita figures less than onethird of the U.S. average.
Receipts per employee in Arizona were 16 percent below average in the information sector. Arizona came closest to the national average in the newspaper publishers industry group. Payroll per employee in the information sector was 17 percent below average. The sector's average number of employees per establishment was 9 percent below average.
Unlike other sectors, the Economic Census for the information sector does not publish sectoral totals by county and city. In some places, subsector totals are provided, especially in broadcasting and telecommunications. Maricopa County accounted for more than three-fourths of the state's employment in broadcasting and telecommunications. The maJor cities of Phoenix, Mesa, Tempe, Scottsdale and Tucson made up very high percentages of the state totals in the published subsectors.
PROFESSIONAL, SCIENTIFIC AND TECHNICAL SERVICES
Among the 10 sectors for which 1997 Arizona data are available, this sector's total of 10,256 establishments ranked third. Average establishment size (7.5 employees per establishment) was second smallest, however, so that its employment of 77,074 ranked only sixth. Receipts of $6.8 billion ranked fourth.
Establishments in this sector are divided into those subject to or exempt from the federal income tax. Most data are available only for those subject to the tax, which accounted for 99 percent of the total establishments.
Sectoral Detail
Nine industry groups comprise this sector. Employment and receipts were greatest in architectural, engineering and related services. Engineering services was responsible for twothirds of the group's receipts and employment. Architectural services and testing laboratories were the largest of the other industries.
Of the nine industry groups, legal services ranked first in number of establishments, second in receipts and third in employment. Offices of lawyers made up most of this group, which had the second highest average wage.
Accounting, tax return preparation, bookkeeping and payroll services ranked second in employment. but had low receipts per employee and low payroll per employee. More than one-half of the industry group's establishments and receipts came from offices of certified public accountants, but this industry accounted for only 30 percent of employment.
Computer systems design and related services produced nearly $1 billion in receipts, ranking third, and had the highest payroll per employee among the nine industry groups. Custom computer programming nearly matched computer systems design services in size.
Management, scientific and technical consuiting services ranked fourth in receipts and fifth in employment. Management consulting services accounted for most of the group's activity. The advertising and related services industry group was smaller and included public relations agencies and media buying services.
Specialized design services consists of interior design, industrial design and graphic design. It was the smallest industry group. The scientific research and development industry group also was small in terms of V receipts and employment, but had the highest number of employees per establishment, the greatest receipts per employee and a high average wage. Most of the "other services" industry group consisted of marketing research and public opinion polling, an photographic services.
Geographic Detail
The professional, scientific and technical services sector was highly concentrated in Maricopa County in 1997, with little activity occurring outside of the Phoenix and Tucson areas. Per capita receipts and employment were considerably higher in Maricopa County than in Pima County. Cochise was the only other county which approached Pima's per capita figures.
Paradise Valley, Phoenix, Scottsdale and Tempe possessed the highest per capita figures. Management consulting was prominent in Scottsdale and advertising services were of above average importance in Tempe. Sierra Vista, Tucson and Pinetop-Lakeside also had per capita figures higher than the state average.
ARTS, ENTERTAINMENT AND RECREATION
Consisting of a total of 1,336 establishments, receipts of $2.3 billion and employment of 31,087, this sector was the second smallest of the 10 for which 1997 Economic Census data have been released. While nearly 90 percent of the receipts derived from establishments subject to the federal income tax, establishments exempt from the tax accounted for 20 percent of the establishments and employment.
Sectoral Detail
Amusement, gambling and recreation was by far the largest of three subsectors (see Table 3). Average establishment size also was greater than in the two other subsectors. The gambling industry group in 1997 consisted of 31 establishments employing nearly 5,000. The average number of employees per establishment was quite high at 161. Receipts per employee were high, but payroll per employee was below the average of all sectors. Other major employers included golf courses and country clubs. and fitness and recreational sports centers.
Five diverse industry groups comprise the performing arts and spectator sports subsector. Spectator sports accounted for most of the employment and receipts, had the highest average establishment size, and had average payroll per employee more than triple that of the other groups. The other groups in order of size were promoters of performing arts and sports. which had a particularly low average wage; performing arts companies, which had low receipts per employee; independent artists, writers and performers; and agents and managers for artists, athletes and other public figures, with only 64, employees.
The museums and historical sites industry group employed only 204 workers. Payroll per employee was low.
Geographic Detail
Unlike most sectors. the arts. entertainment and recreation sector was found across the state in shares relatively equal to population shares. Per capita employment was highest in La Paz. Gila and Coconino counties. Gambling establishments were responsible for nearly all employment in Gila and La Paz counties. Three other counties also exceeded Maricopa County's per capita employment.
Per capita employment was high in the unincorporated portions of Gila, La Paz and Yavapai counties and in South Tucson and Somerton. Scottsdale and Queen Creek had the highest figures in Maricopa County.
OTHER SECTORS
The health care and social assistance sector for Arizona was presented in the September 1999 issue of AZB. The national figures now are available for comparison. Overall. per capita receipts in Arizona was 16 percent. and per capita employment was 20 percent, below the national average. Arizona was below average in all four subsectors, particularly nursing and residential care, and hospitals, In contrast, receipts per employee were slightly higher than the national average, and payroll per employee was about average. --Tom R. Rex
Research Manager
Copyright Arizona State University Center for Business Research Dec 1999