According to the 11th annual Cyberstates report, the spike in investments could be a good sign for the state's technology industry. Idaho ranks among the lowest states for job growth in the high-tech industry, but a new report shows that a spike in investment may be a sign of a brighter future for the sector.

The 11th annual Cyberstates report by the American Electronics Association, to be released Wednesday, said venture capital investments in Idaho jumped by 977 percent in 2007 to $16.2 million, up from $1.5 million in 2006.

"The good news is that venture capital investments skyrocketed; the bad news is that they had been dreadfully low in 2006," Terry Byington, executive director of the association's Washington Council, which represents Idaho companies, said in a statement. "VC investments are a leading indicator of future tech industry growth. Hopefully this means better times are to come for Idaho."

But Mark Solon, a managing partner in Boise-based Highway 12 Ventures, said it's too early to make predictions. He said the bulk of the money in 2007 was directed at only a handful of companies.

"It's hard to call two or three companies being funded a trend, but hopefully we see that type of funding year after year," Solon said.

To keep funding growing, it is critical to see growth in research, development and innovation, Solon said - trends he doesn't see.

"The state needs, in my opinion, to continue investing in research and development and innovation for this to be sustainable," he said.

Despite the growth in venture capital, Idaho lags far behind the amount of investment made in many of its neighboring states.

Washington received just over $1.3 billion in funding in 2007, while Oregon had $301.5 million and Utah $182.4 billion.

The report said Idaho's high-tech industry saw only a modest gain of 200 jobs in 2006 , for a total of 36,400 workers. The fastest-growing sector was in the semiconductor industry, which totaled 12,100 workers in 2006.

But since 2006, that industry has been the hardest hit with layoffs. Since June, Micron Technology has laid off more than 1,100 workers in the Treasure Valley. Last month AMI Semiconductors said it would lay off 60 to 90 people within 90 days, and 150 more workers would be eliminated over the next two years. The layoff announcements came after the Pocatello company completed its sale to Phoenix-based ON Semiconductor Corp.

The report's number of high-tech jobs is lower than those reported by the Idaho Department of Commerce, which reported just over 56,000 employees in 2006. The department bases its number on Bureau of Labor Statistics definitions for high-tech jobs. The association said it takes a more conservative view and excludes certain categories.

The report found that high tech jobs in Idaho pay an average of $67,200 a year, more than double the state average wage of $32,400 a year.

"With tech workers being paid more than double the state's average private-sector wage, it's imperative that the tech industry in Idaho grows," Byington said.

By Ken Dey - kdey@idahostatesman.com
Edition Date: 04/02/08

Ken Dey is the high-technology reporter at the Idaho Statesman. Read his TechIdaho blog at IdahoStatesman.com. Reach him at 672-6757 or kdey@idahostatesman.