Geography of Employment and Establishment Dynamics in Information Technology and E-Commerce Industries

Firm-specific data were used to analyze variation in employment and establishment dy-namics (birth, death, expansion, and contraction) of metro, metro-adjacent, and non-metro re-gions in the State of Kansas. To account for overall dynamism, a model of regional change based on classical economic theory was developed. Employment and establishment dynamics in Information Technology (IT)-producing and using industries, E-commerce-intensive indus-tries, and goods and service-producing industries were studied using panel data between 1990 and 2003. Results indicated there were significantly more employment and establishment births in metro IT-producing, IT-using, and service-producing industries versus the metro-adjacent region. A comparison between the metro and non-metro regions showed higher le-vels of employment births in metro IT-using and service-producing industries. Overall, the non-metro region showed relatively better employment growth in IT-producing and goods-producing industries. The results shed light on prospects for rural areas to capture a share of the economic growth associated with these industry sectors.