A new report released today by the Progressive Policy Institute shows Mexico’s App Economy – app developers and other workers who create, maintain, and support mobile phone applications – grew by 11 percent from 2019 to 2020, and by 7 percent from 2018 to 2019. The report also estimates Mexico has 178,000 App Economy jobs as of 2020. This growth is consistent with App Economy growth across the world during the pandemic.
“As people have engaged in social distancing and work from home to mitigate the virus, wireless connectivity has never been more critical. Smartphones and apps are increasingly becoming a part of daily life, and Mexico’s strong and growing app economy is indicative of the country’s embrace of digital transformation and shows how Mexico will be positioned as the global economy recovers from this pandemic,” said Michael Mandel and Elliott Long, report authors and economists at the Progressive Policy Institute.
This growth is helping cushion the economic and human damage wrought by the COVID-19 pandemic in Mexico.
For the firms that adopt them, artificial intelligence (AI) systems can offer revolutionary new products, increase productivity, raise wages, and expand consumer convenience. But there are open questions about how well the ecosystem of small and medium sized enterprises (SMEs) across Europe is prepared to adopt these new technologies. While AI systems offer some hope of narrowing the recent productivity gap between small and large firms, that can only happen if the technologies actually diffuse throughout the economy.
Policymakers have naturally been attracted to this topic as SMEs represent the backbone of the European economy, making up 99% of all businesses. And an AI-enabled productivity boost would be particularly timely as SMEs are recovering from the effects of the ongoing Covid-19 crisis.
At the same time, the EU has articulated a desire to be on the forefront of developing novel AI regulations. The EU is contemplating new regulations on the development and deployment of AI that seek to address dual priorities2: How can the EU simultaneously increase the uptake of AI by European firms while shaping the regulatory environment to protect European consumers from harm?
And while the EU’s ambition is laudable, the Commission’s pronouncements have so far failed to grapple meaningfully with the significant tradeoffs that the regulation of new technologies entails. As is the case with all new technologies, the adoption of AI systems — i.e., the broad suite of technologies that are designed to automate or augment aspects of human decision making — involves a tradeoff between risk-mitigation and rapid adoption. Unless carefully managed, the effort to protect consumers from potential risks places additional burdens on firms, which can chill investment and adoption, especially among SMEs. Policymakers thus need to achieve a balance between these two objectives.
With this in mind, our report outlines various policy considerations that should enable policymakers to achieve this balance between the two goals and embody the principle of Thinking Small First3 — the idea that public policy should consider the potential impacts on SMEs from the ground up. The report discusses the promise for AI systems to increase productivity among EU SMEs, the current barriers to AI uptake, and policy tools that may be useful in managing the risks of AI while maximizing the benefits.
12 Women Join the Effort to Diversify the Policy Debate
Today, the Mosaic Economic Project, an initiative of the Progressive Policy Institute, announced it’s second cohort of policy experts participating in the ‘Women Changing Policy’ workshop, March 29 – 31, 2021. The women are all experts in the fields of economics, business and technology, who are forging a path forward to bring a diverse perspective to today’s public policy debates.
The project’s goal is to locate, elevate, and advocate for the inclusion and engagement of experts with diverse experiences and an interest in meaningful policy conversations with a focus on Congress and the media.
“We are thrilled to welcome another class of talented, highly skilled, and diverse leaders to Mosaic Economic Project’s second cohort. This event will help this dynamic group of women hone their skills for high-profile engagement in public policy debates, and promote inclusiveness within the economic growth and innovation fields of study,” said Crystal Swann, Mosaic Economic Project team lead.
This diverse and talented group of leaders will hear from experts in public policy and media, including leaders and representatives from the United States Congress, the media, communications consulting firms, and more.
The Mosaic Economic Project Cohort includes:
Hilary Abell, co-founder of Project Equity
Dr. Lisa Abraham, Associate Economist at the RAND Corporation
Joanna Ain, Associate Director of Policy at Prosperity Now
Talisha Bekavac, Vice President of Government and External Affairs for the U.S. Black Chambers (USBC)
Dr. Carycruz M. Bueno, Postdoctoral Research Associate at the Annenberg Institute and The Policy Lab at Brown University
Melissa Gopnik, Senior Vice President at Commonwealth
Dr. Tiffany Green, Assistant Professor of Population Health Sciences and Obstetrics and Gynecology at the University of Wisconsin-Madison
Dr. Leshell Hatley, Associate Professor of Computer Science at Coppin State University
Gabriella Kusz member of the Board Directors and Public Policy and Regulation Committee of the Global Digital Asset and Cryptocurrency Association
Aditi Mohapatra, Managing Director at BSR
Dr. Sarah Oh, Senior Fellow at the Technology Policy Institute
Jessica Schieder, Federal Tax Policy Fellow at the Institute on Taxation and Economic Policy (ITEP)
For more information on how to contact the members of the Mosaic Economic Project please reach out to Crystal Swann at cswann@ppionline.org.
Amidst the turbulence of the global Covid-19 pandemic, Australia went through its first recession in almost 30 years. Yet the Australian App Economy has grown compared to 2019, when we last estimated Australia’s App Economy employment.
Remember also that the App Economy has a history of being recession resistant. Apple opened the first App Store in July 2008, just as the global economy was plunging into financial crisis. The App Store and the others that followed, including Google Play (originally Android Market) which launched in October 2008, were successful despite historic economic turmoil.
This report updates our 2019 paper, “The Australian App Economy, 2019 Update” and our 2017 paper, “The Rise of the Australian App Economy.” Based on our methodology that combines government occupational figures with comprehensive data on posted job openings, we estimate that Australia has 156,000 App Economy jobs as of January 2021, up from 136,000 in January 2019.
This 15 percent gain in App Economy jobs is partly driven by an increase in the overall number of ICT professionals, as reported by the Australian Bureau of Statistics, combined with a steady share of IT job openings that require App Economy skills, such as knowledge of iOS or Android.
The steady growth of the App Economy is particularly important for Australia, because mobile apps can be exported globally. Australian-based apps such as Procreate, Canva, Afterpay, Pocket Casts, and TripGo have significant global user bases.
ANALYSIS
For this study, a worker is in the App Economy if he or she is in:
• An IT-related job that uses App Economy skills—the ability to develop, maintain, or support mobile applications. We will call this a “core” App Economy job. Core App Economy jobs include app developers; software engineers whose work requires knowledge of mobile applications; security engineers who help keep mobile apps safe from being hacked; and help desk workers who support use of mobile apps.
• A non-IT job (such as sales, marketing, finance, human resources, or administrative staff) that supports core App Economy jobs in the same enterprise. We will call this an “indirect” App Economy job.
• A job in the local economy that is supported either by the goods and services purchased by the enterprise or by the income flowing to core and indirect App Economy workers. These “spillover” jobs include local professional services such as bank tellers, law offices, and building managers; telecom, electric, and cable installers and maintainers; education, recreation, lodging, and restaurant jobs; and all the other necessary services. We use a conservative estimate of the indirect and spillover effects.
We estimate the number of App Economy jobs by combining quarterly data on ICT professionals from the Australian Bureau of Statistics with comprehensive counts of “App Economy” job openings in Australia from Indeed.com. 1, 2 The methodology is described in the Appendix to the 2017 study. We estimate that Australia has 156,000 App Economy jobs as of January 2021, up from 136,000 in January 2019 and 113,000 in March 2017 (Table 1).
Many App Economy job postings list a mobile operating system or multiple mobile operating systems with which the job candidate is expected to be familiar. This allows us to assess the distribution of mobile operating systems in the Australian App Economy. We estimate that Australia has 137,000 jobs in the iOS ecosystem, and 123,000 jobs in the Android ecosystem. Compared to 2019, estimated iOS ecosystem jobs are up 14 percent, while estimated Android ecosystem jobs areup 16 percent.
How does Australia’s App Economy compare to other industrialized peers? Obviously countries such as the United States and the United Kingdom are much larger than Australia, making direct comparisons difficult.
Instead, we calculate the “app intensity” of different countries, defined as the number of App Economy jobs as a share of total jobs. Table 3 compares Australia’s app intensity with that of the United States, Canada, Germany, and the United Kingdom.
As of January 2021, Australia had an app intensity of 1.2 percent, higher than Germany and roughly comparable to the United Kingdom but lagging Canada and the United States. Table 3 also shows that app intensity rose during the pandemic, which is not a surprise because the App Economy grew while the rest of the economy shrank.
GEOGRAPHY
Our methodology enables us to estimate the geography of App Economy jobs, since job postings generally identify where the job is located. Table 4 lists App Economy jobs by state and territory and calculates app intensity.
Not surprisingly, New South Wales and Victoria lead in the number of App Economy jobs. Australian Capital Territory (ACT) has the top app intensity, followed by New South Wales. Note that with the Covid pandemic, more work is being done remotely. We have modified the methodology slightly to take account of this factor, but at least up to now, the number of Australian App Economy jobs being advertised as purely remote without a location is not large enough to substantially distort the results.
The same approach enables us to estimate App Economy jobs by urban areas. We use a radius of 50 kilometers as our measure of the urban area, except for a small number of cities that are sufficiently close to larger urban areas that a 50 km radius would pick up a significant number of jobs from the larger area. In those cases, marked by an asterisk, we use 25 kilometers as our measure.
Table 5 ranks the top urban areas by App Economy jobs, rounded to the nearest thousand. Note that urban areas with less than 500 jobs are reported as NA (not available). Sydney, Melbourne, Brisbane, and Perth are at the top of the list.
Finally, for this report we introduce a new analysis. Many core App Economy jobs require familiarity not only with iOS or Android, but with one of the app development languages or frameworks, such as Swift (iOS) or Kotlin (Android).
Table 6 below presents a list of app development languages and frameworks, ranked by the number of mentions on App Economy job postings. Java is first, followed by Swift. Because the methodology is new, we are not yet ready to quantify the list.
EXAMPLES
App Economy workers are found across most industries and geographic areas in Australia. Of course the tech sector is hiring workers with Android and iOS knowledge. As of February 2021, IT consulting firm Cognizant was searching for an iOS engineer in Melbourne. Digital product creator Roam Creative was seeking an intermediate iOS developer in Sydney. Zensys Technologies was looking for a developer with iOS and Android experience in Tamworth, New South Wales. ContentKeeper Technologies, which focuses on web security solutions, was hiring a quality assurance engineer with understanding of iOS and Android in the Australian Capital Territory.
Financial services is one key area where there is a lot of demand for App Economy workers. Banking company Bankwest was searching for a mobile developer with knowledge of Kotlin and Swift in Perth. Commonwealth Bank was looking for a senior software engineer with knowledge of iOS and Android applications in Perth. National Australia Bank was hiring a security consultant with testing experience on iOS and Android in Melbourne. Financial services firm Suncorp Group was searching for a senior developer with experience in Swift, Android or Xamarin in Brisbane.
Fintech firm Zip was seeking an Android engineer in Sydney. Zip, which specializes in point-of-sale credit and digital payment services, has operations across Australia, New Zealand, South Africa, and the United Kingdom and recently acquired US-based QuadPay.3 CoverMore Insurance Services was looking for an iOS developer in North Sydney.
But Australia’s App Economy continues to spread to other industries too. Online healthcare company HealthEngine was looking for iOS and Android engineers in Perth. HealthEngine bills itself as “Australia’s consumer healthcare platform.” Personal fitness app Today’s Plan was searching for a test engineer with iOS and Android experience in Canberra.
A company called Real Time Data—which “provides software applications which revolutionize the collection, reporting, and management of commercial fishing worldwide”— was searching for a full stack iOS developer in Adelaide.4 The company’s LinkedIn page states boldly that “We believe the future of humanity relies on sustainable oceans.” The Victorian Department of Environment, Land, Water and Planning was hiring for a software engineer with experience in Xamarin development for Android and iOS in Melbourne.
Global commercial real estate giant CBRE was looking for an Android software engineer in Brisbane. Sports betting platform Sportsbet.com.au was hiring an Android developer in Melbourne. Handmade goods company Tibet House was searching for a software engineer with knowledge of iOS and Android in Heidelberg West, Victoria. Consumer loyalty program flybuys was seeking a senior Android engineer in Melbourne. eBay Inc. was looking for an Android developer in Sydney. Online car selling platform carsales.com.au was hiring an iOS developer in Melbourne.
Accenture was seeking a lead security consultant with iOS and Android experience in Brisbane. Deloitte was looking for a digital technology consultant with experience in iOS and Android in Canberra. MCS Consulting was hiring a mobile software engineer with experience in iOS and Android in Melbourne. Marketing company Metigy was searching for a senior Android developer in North Sydney. New Zealand-based cloud accounting platform Xero was seeking a senior mobile product designer with knowledge of iOS in Melbourne.
Multi-modal public transportation company Keolis Downer was searching for an application support developer with experience in iOS and Android application development in Adelaide. Keolis Downer is the largest light rail operator in Australia and a major bus operator. RMIT University was seeking a senior developer with iOS and Android experience in Melbourne. Macleans Waste Management was looking for a full stack developer with experience in Kotlin development for Android in Penrith, New South Wales.
Truck and equipment tracking firm Teletrac Navman was hiring an Android lead in Melbourne. Honeywell, which recently acquired Adelaide-based Sine, a maker of a visitor and contractor management app, was hiring two Android developers there. Legal assisting app Smokeball-AU was seeking a software tester with iOS and Android experience in Sydney.
Media content creator Nine was hiring a senior software engineer with experience in iOS and Android programming in North Sydney. Social networking app Travello was seeking a full stack Android developer in Fortitude Valley, Queensland.
Examples of Export Apps
Our 2019 report noted that “Apps created in Australia can be easily delivered across the world, without expensive transportation, to generate jobs and income at home.” That’s even more true today. Graphic design platform Canva, cited in the 2019 report, is based in Sydney and now has more than 30 million users worldwide.5 Art app Procreate, also cited in the 2019 report, was developed by Hobart-based Savage Interactive. Procreate is used by artists at Pixar, Mattel, Ubisoft, DC Comics, and Disney.
Another “export” app is Afterpay, headquartered in Melbourne, which provides online post payment services and has more than 11 million global users.6 Pocket Casts, based in Adelaide, South Australia, is a podcast hosting app with global reach.7 And TripGo, developed by SkedGo in Sydney, lets users around the world compare and combine transport modes like train, bus, taxi, subway, metro, cab, tram, car, bike, motorcycle or ride share.8
CONCLUSION
While the Covid-19 pandemic induced Australia’s first recession in nearly three decades, Australia’s App Economy has once again served as an important source of growth. As of January 2021, we estimate that Australia has 156,000 App Economy jobs, an increase of 15 percent relative to our January 2019 estimate of 136,000 jobs. The country’s App Economy is competitive globally, with this growth spread throughout the states and territories in industries like tech, commerce, banking, government, and healthcare. Australia’s App Economy is also exportable, with a number of apps attaining a global following.
ABOUT THE AUTHORS
Dr. Michael Mandel is chief economic strategist at the Progressive Policy Institute and senior fellow at Wharton’s Mack Institute for Innovation Management at the University of Pennsylvania. Mandel received a Ph.D. in economics from Harvard University and formerly served as chief economist at BusinessWeek.
Elliott Long is senior economic policy analyst at the Progressive Policy Institute. Elliott holds a BA in Political Science from Florida Gulf Coast University and MPA from George Washington University.
WASHINGTON, D.C. – A new report from the Progressive Policy Institutediscusses the impact of state and local price controls on food delivery services and explores other policy solutions that would actually help small restaurant owners and their workers weather the recession caused by the COVID pandemic.
The industry has some big chains, but most restaurants are quintessentially small businesses. More than 9 in 10 restaurants have fewer than 50 employees. More than 7 in 10 restaurants are single-unit operations. Restaurants also offer lots of entry-level jobs for less-skilled workers (almost one-half of workers got their first job experience in a restaurant). Delivery services have been one of the few sectors expanding during the pandemic, providing work for those who need it and helping many Americans stay safe during the pandemic. With the goal of helping restaurants, some states and cities have temporarily capped the commissions these platforms can charge restaurants for delivery. These price controls are popular with elected officials because they look like a cost-free way to help struggling restaurants, but their costs are hidden, not free, and will hit small restaurants and their workers hardest.
There’s a better way forward. The federal government can provide (and has provided) direct bailouts of the businesses and their workers. Unemployed workers have received extended and bonus unemployment benefits. These benefits should be continued for the duration of the public health emergency. Restaurants should receive grants and loans so they can continue paying rent and other fixed costs while closed. These programs should be funded to the level that every restaurant can benefit from them. “Just give people and businesses cash” sounds simple (and expensive), but the alternatives are much worse. Providing no help to restaurants would force them to choose between closing permanently or staying open — thus exacerbating and prolonging the pandemic. Imposing price controls will likely lead to a reduction in output, harming consumers, drivers, and restaurants in the process. The answer is for the federal government to help bridge the gap to the end of the pandemic by continuing and increasing its support for workers and businesses.
Author Alec Stapp, director of technology policy at PPI, had this to say:
While bailouts are never uncontroversial, bailing out the restaurant industry is an easy call. There is no moral hazard risk as there was with the bank bailouts in 2008, when it was reasonable to worry that bailed out financial firms would increase their risky behavior in the future knowing that they would be bailed out in the event of a crisis. In this case, restaurants won’t change their behavior in the future in a way that increases the odds of a deadly pandemic.
Apple announced this morning that it is reducing its commission on paid apps and in-app purchases from 30% to 15% for qualified small businesses and independent developers. This move obviously has plenty of implications for competition policy and business models.
But from the perspective of macroeconomic recovery, this commission reduction comes at just the right time to simulate post-pandemic job growth.
It’s important to remember that the App Economy has been a potent source of jobs ever since Apple opened the first App Store in July 2008. In a September 2020 research note, we estimated that from the App Store’s opening in July 2008 to the pre-pandemic economic peak in February 2020, the App Economy generated a total of 2.4 million jobs. That’s relative to the 15 million nonfarm payroll jobs created by the whole U.S. economy over the same period. The implication is that an estimated 16% of net job growth since the creation of the App Store in July 2008 has come from the App Economy.
The App Economy gains have continued through the pandemic recession, with our research showing that App Economy employment rising by 12% from April 2019 to August 2020, despite the weak economy. Employment in the iOS ecosystem and the Android ecosystem, respectively, are up up 15% and 14% from the April 2019 estimates. (Note that many App Economy jobs belong to both ecosystems).
The commission reduction will build on these long-term trends, stimulating hiring by the “long tail” of small app developers and startups. Apple’s announcement says that the reduced commission will apply to existing developers who made up to $1 million in 2020 for all of their apps, as well as developers new to the App Store. So if you are a small business that is earning $500,000 in the App Store, the commission reduction may very well tip the scale for bringing on a new app developer, an extra sales person, or both.
It’s difficult to quantity the effect of the commission cut, but it certainly will make small businesses more willing to take chances and expand even in an uncertain economic climate. Climbing out of the pandemic, any action that encourages small business hiring is good news for the U.S. recovery.
As of August 2020, we estimate that the United States has 2.52 million App Economy jobs, up 12% from our latest April 2019 estimate (released September 2019). This estimate includes a conservative estimate of spillover jobs (for a definition of an App Economy job and an explanation of our methodology, please see the appendix of our 2017 report) .
We can also estimate App Economy jobs by mobile operating system. As of August 2020, there are 2.135 million jobs in the iOS ecosystem and 1.983 million jobs in the Android ecosystem, up 15% and 14%, respectively, from the April 2019 estimates. Note that many App Economy jobs belong to both ecosystems.
In the middle of a pandemic-induced recession, well-known companies like Snapchat, Etsy, Capital One and Square have posted job openings for mobile app developers. So have lesser-known companies like UrgentCare2go and ForeFlight in Texas; Echelon Fit Multimedia and Tomahawk Robotics in Florida; ZYRL.us and Gambyt in Michigan; and Zumper in Illinois. The demand for mobile app developers and other app-related jobs has been broad, across retail, finance, healthcare, networking, defense, and other industries.
The gains are driven in part by the overall rise in the number of people working in computer and mathematical occupations, which is a key input to our estimation procedure. Gains, not surprisingly, are also due to the increasing importance of mobile apps in a world of telehealth, virtual meetings, and remote learning.
The App Economy also has a history of being recession-resistant. Remember that Apple opened the first App Store in July 2008, just as the U.S. economy was plunging into financial crisis. The App Store and the others that followed, including Google Play (originally Android Market) which launched in October 2008, were successful despite historic economic turmoil.
Moreover, the App Economy served as an important engine for the long economic expansion that was ended by the pandemic in February 2020. The table below show our estimates of App Economy employment, going back to fall 2011. The table also includes an interpolated estimate for February 2020, the last pre-pandemic month.
We find that from July 2008 to February 2020 the App Economy generated a total of 2.4 million jobs, compared to the roughly 15 million nonfarm payroll jobs created by the whole U.S. economy. So an estimated 16% of net job growth since the creation of the App Store in July 2008 has come from the App Economy.
These calculations come with caveats, of course. We are tracking App Economy jobs by analyzing online job postings, an indirect methodology that is not as reliable as direct job counts. But it’s also true that the App Economy has transformed the way that people spend their time. According to one survey, American adults spent more than 2 ½ hours per day on mobile apps in 2019. By comparison, government data shows the average American spends about 2 hours per day preparing meals, eating, and cleaning up afterwards.
The Rise of the App Economy, 2008-2020
Date of Estimate
Date of Publication
App Economy Jobs (thousands)
Nonfarm payroll jobs (millions)
July 2008
Creation of App Store
0
137.5
November 2011
February 2012
466
132.7
April 2012
October 2012
519
133.8
June 2013
July 2013
752
136.3
December 2015
January 2016
1660
143.1
December 2016
May 2017
1729
145.4
April 2019
September 2019
2246
150.5
February 2020
interpolated
2417
152.5
August 2020
August 2020
2520
139.6 (July)
Data: South Mountain Economics, Progressive Policy Institute
We can do a similar calculation for the iOS and Android ecosystems as well, as the table below shows. The iOS ecosystem contributed an estimated 14% of net job growth from the creation of the App Store in July 2008 to February 2020, the peak month before the pandemic started. Similarly, the Android ecosystem contributed an estimated 13% of net job growth between July 2008 and February 2020.
The App Economy’s Contribution to Job Growth
(share of nonfarm payroll job growth, July 2008-February 2020*)
All App Economy jobs
16%
iOS ecosystem
14%
Android ecosystem
13%
*Based on an interpolated estimate. Many App Economy jobs belong to both ecosystems. Data: Progressive Policy Institute
What about on the state level? Here are the top 20 states, ranked by the number of App Economy jobs as of August 2020.
This report provides an update to our 2016 paper on Colombia’s App Economy. We find 87,900 App Economy jobs in Colombia, up from 83,100 two years ago. We compare Colombia’s App Economy performance to other Latin American countries, estimate the relative size of the iOS and Android ecosystems, and give some examples of companies that are hiring App Economy workers.
Apple’s introduction of the iPhone in 2007 initiated a profound and transformative new economic innovation. While central bankers and national leaders struggled with a deep financial crisis and stagnation, the fervent demand for iPhones – and the wave of smartphones that followed – was a rare force for growth.
Today, there are five billion mobile broadband subscriptions globally, an unprecedented rate of adoption for a new technology.Use of mobile data is rising at 65 percent per year, a stunning number that shows its revolutionary impact.
The smartphone era helped power Korea’s economic growth over the past decade. Samsung announced its first Android phone in April 2009, eventually becoming the largest smartphone maker globally measured by volume. But the smartphone was about more than hardware. Apple’s opening of the App Store in 2008, followed by Android Market (now Google Play) and other app stores, created a way for iOS and Android developers to write mobile applications that could run on smartphones anywhere.
