I made an important discovery recently: The Heritage Market in Fincastle will slice cheese at whatever thinness or thickness the customer wants.
That’s my segue into pointing out that data can be sliced just like horseradish cheddar: lots of different ways.
Last week I shared a fascinating report by Mark Muro and Sifan Liu of the Brookings Institution about the digitalization of the economy — basically how digital skills have now become part of many jobs that we don’t traditionally think of as “high tech” jobs.
Best of all, from my point of view, the report breaks all this down geographically — to the level of metropolitan areas and micropolitan areas (much like metro areas, just smaller places such as Bluefield, Danville and Martinsville).
I reported some of the findings last week: This data traces the rise of the Blacksburg metro as one of the state’s top tech centers. (Here’s where I once again point out that we’re hoping to add a technology reporter to write more about that tech cluster; you can help fund us.) It also helps illustrate how quickly the economy has gone digital even in places that we don’t think of as tech-oriented communities. For instance, the Martinsville micropolitan area (Martinsville and Henry County) has the least digital economy in the state — but it’s also gone digital at a faster rate than any other place.
Since then I’ve delved deeper into this report and found another fascinating nugget about a different community. Beware, this is going to involve some math, but I promise to keep it to as few numbers as possible.
The Brookings report divides jobs into three categories: those that are highly digitalized, those with medium amounts of digitalization, and those that are considered low digitalization. Not surprisingly, those that are highly digitalized are paid the most.
In my previous column, I dealt with averages. Today, let’s open those up and look more specifically at how the economy is structured in each community. First, let’s look at how the percentage of highly digitalized jobs has changed over the course of the past two decades.
Nationally, we see the highest percentages in places such as Silicon Valley, where 39.3% held highly digitalized jobs in 2002, 50.2% did in 2010 and 52.3% did in 2020. Our rates are, not surprisingly, somewhat lower:
OK, that’s kind of hard to read, except for the Washington, D.C., metro, where the percentage of highly digitalized jobs started at 15% in 2002, rose to 26% in 2010 and rose again to 34% in 2020 — obviously high by our standards but not by Silicon Valley standards. Or even other tech capitals — Austin comes in at 50.3%, Boston 50.2%, Seattle 49.6%, San Francisco 49.4%, New York 48%. But I digress.
Let’s run that chart again but this time just look at the top six places in Virginia.
Now we can see two things more clearly. One is the rise of Blacksburg, which started out tied for fourth and is now third, behind the Washington metro and Charlottesville, having pulled away from Hampton Roads and surpassed Richmond.
The other thing is the rise of Lynchburg, which started out at the bottom of the top six and has now passed Hampton Roads.
Perhaps this chart shows something else: the slowdown in the growth of highly digitalized jobs in both Richmond and Hampton Roads, at least relative to other places. That’s hard to believe in the Richmond area, now the fastest growing part of the state but easier to believe in Hampton Roads, which is now losing population (see my recent column on the state’s latest population estimates).
Now let’s look at all the other places, with the Washington metro as a marker.
All right, that’s a mess, too, so let’s drop out some of those places to zero in on the point I’m trying to make.
Ah, now we can see it better. In 2002, three parts of Virginia were tied for the lowest percentage of highly digitalized jobs: Big Stone Gap, Danville and Martinsville. (By Big Stone Gap, we mean the Big Stone Gap micropolitan area, which covers Wise County, Dickenson County and Norton. How it got named after Big Stone Gap when other metro and micropolitan areas are named the biggest community I don’t know, although that is a colorful name.)
In any case, in 2002, those three places all had just 4% of their jobs in highly digitalized jobs. Over the past two decades look at what has happened. All have seen that percentage grow but their relative positions haven’t changed much. Danville was tied for last; it’s still tied for last. Martinsville was tied for last, now it’s slightly ahead of Danville — and Staunton, whose growth in highly digitalized jobs has been the slowest of all.
But look at Big Stone Gap. Tied for last in 2002, it’s now in the middle of the pack at 22% — and has a higher percentage of highly digitalized jobs than Roanoke, which is at 21%. Also a higher percentage than Bristol-Kingsport, Winchester, Harrisonburg, Bluefield, Martinsville-Danville and Staunton.
No other community saw its percentage of highly digitalized jobs grow at such a fast rate — 5.5 times what it was in 2002. (The second fastest growth rate was in Martinsville, at 4.5 times; the slowest was in Staunton at 2.83 times.)
What is happening in coal country that is driving such a high rate of highly digitalized jobs? This data certainly defies all the stereotypes, right? (That’s one reason I love data.) Kristen Westover, president of Mountain Empire Community College, isn’t surprised. “The region has been very intentional in attracting companies that require IT skill sets,” she told me by email.
“It is definitely a strategy,” said Kalen Hunter, director of economic development for the University of Virginia’s College at Wise and director of GO Virginia Region 1, which covers that part of the state (and everything up to Wythe County). Part of that is known as Project Fuse, initiated by the InvestSWVA economic development group, which has encouraged hybrid working arrangements in Southwest Virginia. Last summer, a Richmond-area company that automates payment and invoice services for business clients announced it would locate an operation in Wise County and hire 50 people. “One of the reasons Paymerang located in Big Stone Gap was Project Fuse,” Hunter said. In 2021, Earthlink announced it would open a customer service center in Norton and hire 285 people. Those are just two of many companies that have located operations in the region.
Jonathan Belcher, executive director of the Virginia Coalfield Economic Development Authority, isn’t surprised by the data and ticks off more company names: “I feel it is due to the numerous IT related jobs that VCEDA and others have recruited to those jurisdictions over that time period. Just the Sykes/Intuit project in Wise alone created 1,000 jobs, so on a per capita basis I feel projects such as these likely is the cause of the increase in ‘digitalization jobs’ in that area. Other examples would include the SAIC help desk and Serco in Clintwood, Logisticare and Verizon in Norton, Mineral Gap Data Center, Crutchfield, and a few others in Wise. I also feel that growth at Mountain Empire Community College and UVA-Wise likely has a significant contribution to this as well.”
If you’re not familiar with those companies, here’s what Belcher has to say about them: “Most of them are inbound call centers doing various customer and technical support. For example, Sykes/Intuit (which is now called Sitel/Intuit) answers calls from customers who need assistance with Quickbooks and Turbotax. Many of those agents are accountants themselves. SAIC handles computer questions from state employees as part of the state VITA contract. Crutchfield handles sales calls and tech support for Crutchfield consumer electronics (as in car radios, etc.). Mineral Gap is a Tier III co-location data center. All of them require a pretty high level of proficiency in using a computer, and I am sure other types of digital devices.”
All this speaks to how the economy in that part of the state is changing. Last summer, I wrote a column about a book written by St. Paul lawyer Frank Kilgore in which he made the case that Appalachia is unfairly looked down on by other parts of the country. “Not so long ago while meeting in Richmond with state and college officials about bringing high-tech jobs to our mining region, I was point-blank asked if our students had the DNA ‘down there’ to handle such sophisticated jobs,” Kilgore wrote. “After spewing a few visceral comments, I calmed down enough to lay stats on them that debunked such bigotry.” He didn’t have these stats then — they’re new — but they sure fit his premise. Here’s a part of coal country that is building a digital economy on a par with many other parts of Virginia.
Finally, let’s look at the same stats in reverse: the decline of jobs with low amounts of digitalization. The decline of such jobs isn’t necessarily a good thing, especially for workers who don’t have those skills. But it’s a basic fact, and it underscores the need for a better-skilled workforce, particularly in communities that have long relied on traditional employers that have now largely disappeared. As I’ve pointed out many times before, even many manufacturing jobs now have evolved into “advanced manufacturing” jobs with high digitalization scores.
Anyway, let’s look at the numbers.
Once again, this is kind of a spaghetti bowl of lines that we’ll need to untangle. The easiest to read are the top and the bottom. The Washington metro has the lowest percentage of low digitalization jobs: from 40% in 2002 to 22% in 2010 and 17% in 2020. The Martinsville micropolitan area has the state’s highest percentage of low digitalization jobs, but even that percentage has shrunk: from 60% in 2002 to 34% in 2010 to 27% in 2020. Think about what a wrenching experience that has been: In Martinsville, 60% of the jobs once were lightly digitalized; now 52% of the jobs there rank in the medium digitalization range. That’s the changing nature of work right there.
Now on to the untangling.
This chart keeps the communities with the lowest (Washington and Charlottesville) and the highest (Danville and Martinsville) percentage of low digitalization jobs, and then adds the two. communities I want to focus on — Roanoke and Blacksburg.
Or, more precisely, just one. In 2002, Blacksburg had one of the highest percentages of low digitalization jobs (52%) and now has one of the lowest (19%). In 2002, it had a higher percentage of low digitalized jobs than Bluefield and the exact same percentage as Roanoke. Since then, it’s opened up some separation from Roanoke and is now not that much different than Charlottesvillle. (Blacksburg is at 19%, Charlottesville is at 18%, the Washington metro at 17%.)
Once again, the demise of low digitalization jobs isn’t necessarily something to celebrate but it does speak to just how much the economy in the New River Valley has changed.
Looking at these two charts together, it’s clear that Blacksburg is on a trajectory to become a tech capital, if it’s not already. And, as you’ll see, Big Stone Gap’s economy has changed even more:
In 2002, 53% of its jobs were lowly digitalized, now just 20% are. Put another way, the structure of the Big Stone gap economy has changed at a slightly faster rate than the Roanoke economy has.
Now let’s see how fast people’s impressions change.