Pandemic’s impact felt, but tech sector exports held steady for much of the year
U.S. exports of technology products and services totaled an estimated $335 billion in 2020, according to a new report from CompTIA, the nonprofit association for the information technology (IT) industry and workforce.
CompTIA’s “Tech Trade Snapshot” shows that tech product and service exports declined for the first time in four years, down an estimated 4.9% ($17.1 billion) from 2019. But the report also finds that the tech sector held up relatively well in 2020, with exports generally steady throughout the year except for minor dips in April and May.
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U.S. exports of semiconductors totaled $63 billion, an increase of 5.6% year-over-year. The services export category encompassing IT services, cloud services and custom software services also experienced positive growth at an estimated 11.9%.
“The global pandemic reaffirms the critical importance of robust technology infrastructure and the technology professionals that support digital services around the world,” said Tim Herbert, executive vice president for research and market intelligence at CompTIA. “It also reveals the continued need for supply chain agility, operational resiliency and risk management.”
The trade data confirms the size and importance of U.S. technology exports. Technology services exports ranked second only to travel services among all U.S. services export categories in 2020. Technology product exports ranked third in 2020 among all U.S. goods export categories, trailing chemicals and transportation/motor vehicles.
While the largest states account for an outsized share of exports, the impact on revenue and jobs is far-reaching. In all 32 states exported more than $1 billion worth of technology products in 2020, from Texas ($44.9 billion), California ($37.6 billion) and Oregon ($12.2 billion) to Mississippi ($1.2 billion), Maryland ($1.2 billion) and Connecticut ($1 billion). Tech ranks in the top three product export categories in 29 states, including 14 states where it is the leading product category for exports.[1] Technology exports directly supported an estimated 918,500 American jobs in 2018, the most recent year of available data at time of publication.
“U.S. exports of technology products and services have grown steadily over the past decade on the strength of U.S. innovation,” said Ken Montgomery, vice president, international trade regulation and compliance at CompTIA. “Maintaining streamlined, effective, clearly defined and industry-informed customs regulations and export controls is key to continued growth.”
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U.S. businesses and consumers purchased an estimated $475 billion in technology products and services from overseas sellers in 2020, resulting in a net a tech trade deficit of approximately $140 billion last year. The deficit was lessened by a $55 billion trade surplus generated by exports of tech services. Over a 10-year period U.S. tech services exports have totaled nearly $1.3 trillion, resulting in a trade surplus of $433 billion.
The top destinations for U.S. tech exports in 2020 were nearly identical to the previous year with Mexico, Canada and China holding the top spots. The same consistency held true in the services category with Ireland, Switzerland and Japan holding the top spots according to U.S. International Trade Administration statistics.