Sean Hackbarth, at the Free Enterprise Blog, wrote an interesting post about one sector of the economy that has boomed over the past few years. No, I’m not talking about the Democratic Campaign Contributors who Also Happen to Invest Heavily in Solar Energy Companies sector. I mean, the smartphone app industry.
According to the Pew Research Center’s Internet & American Life Project, 45% of American adults now have a smartphone. These gadgets along with tablet computers have sprouted a new industry, the “App Economy,” where entrepreneurs develop and market productivity and entertainment programs used on mobile devices.
This industry has shot off the starting line faster than Usain Bolt. According to a study by economist Michael Mandel for the trade association, TechNet, 466,000 jobs have been created by the App Economy.
Here’s the thing about the smartphone app industry; it is largely untouched by government regulation. As Ray Ramsey, CEO and President of TechNet said, “If you have a computer, broadband connection, and the right skills and software, and you can start coding.” Right now, no government agency has to grant you an App Authorship Permit to write a new bit of coolness for the iPhone. You don’t need to spend 4 or 5 million dollars on an environmental impact survey before you launch Awesome App Industries. If you have the skill and a good idea, you can make your own app and put it on the market.
Entrepreneurs have noticed the low barriers to entry and massive demand and filled a need. As a result, a nationwide market that did not exist five years ago has created roughly 7,800 jobs a month. Over three-quarters of those jobs are small business jobs, which means that less regulation and lower taxes will make it easier for people to jump in, create their own apps, and build business that hire even more people.
But here’s another interesting thought. President Obama has been quite vocal about his desire to spend billions of dollars on community colleges. Here is what he wants from his new initiative, taken from the White House web site.
Community colleges work with businesses, industry and government to create tailored training programs to meet economic needs like nursing, health information technology, advanced manufacturing, and green jobs.
Last July, President Obama proposed the American Graduation Initiative to invest in community colleges and help American workers get the skills and credentials they need to succeed. The Health Care and Education Reconciliation Act includes $2 billion over four years for community college and career training. [Emphasis mine]
There is no doubt those fields need skilled workers, with the exception of the “green jobs” field that has been a complete bust despite the President’s best efforts to proper it up with hundreds of millions of our dollars. Wouldn’t it be better, though, to let prospective students decide what “economic needs” the colleges will help meet through their own choices?
Let me quote one more bit of Hackbarth’s piece.
Peter Farago of Flurry, a company that works with app companies, told the subcommittee that the lack of skilled workers is also a concern for the industry. He surveyed Flurry customers and found that 71% of them need more employees with technical training and only 24% of them could find enough skilled software developers.
Community Colleges are almost perfectly positioned to give that sort of training, if they are left alone to respond to the demands of the educational market. Most junior colleges offer everything from certificate programs all the way up to full-blown two-year degree programs geared toward transfer to a four-year college and every one of those programs work well for technical fields. Better, would-be app authors can take the classes they need à la carte to get the skills they need to enter the field on their own. If our government would stop “encouraging” needs the public doesn’t necessarily want, like “green jobs”, and let local colleges and entrepreneurs work out their arrangements the way they should in a free market economy, there is no limit to how quickly our economy could grow.
You don’t need an app to tell you that.