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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (54225)	4/1/1999 2:40:00 PM
From: yard_man	Read Replies (3) \| Respond to of 132070

Whoa! Where'd this guy get this: biz.yahoo.com High-tech big factor in 8-year-old U.S. expansion By Elizabeth Lazarowitz NEW YORK, April 1 (Reuters) - From Automated Teller Machines to supermarket scanners, technology has seeped into nearly every corner of life, helping propel the U.S. economy in its eight-year-old expansion. Generating millions of dollars in corporate spending and creating thousands of new jobs, the high-tech industry accounts for a growing chunk of the economy. ''The contribution of computers to GDP growth has been very, very substantial,'' said Joel Prakken, chairman of Macroeconomic Advisers. ''Spending by businesses on computers has been growing at a ... 60-70 percent annual rate'' over the past few years. The U.S. economy on Thursday celebrates eight years of uninterrupted GDP growth, its second-longest period of expansion ever, coinciding with the rapid spread of personal computers and the Internet's coming of age. ''Technology and the pace of computer technology in particular have certainly contributed to the growth of output and profits in the United States,'' said Dr. Victor Zarnowitz, director of research at the Foundation for International Business and Economic Research in New York. The most recent industry estimates put the core computing and communications technology industry at around 6.5-7.5 percent of GDP. It is the second-largest U.S. industry behind health services, overtaking traditionally dominant economic drivers such as auto manufacturing, services and construction. While economists debate how much rising technology use has actually boosted productivity, few doubt that spending by businesses and consumers on high-tech products contributed greatly to the expansion. ''There have been times during the 90s ... where it likely would have faltered and produced a couple negative quarters, which is an official recession, where it not for the uneven but consistently high growth of the communications and telecommunications sectors,'' said Dan Luria, vice president of the Michigan Manufacturing Technology Center. Expansion in those sectors has kept manufacturing output growing consistently over eight years, a rare event, he added. The government says about half of all business equipment spending by U.S. companies goes toward ''information technology,'' goods and services related to computers and communications, up from about one-third in the early 1990s. The Information Technology Association of America (ITAA) estimates U.S. companies' total spending on information and communications technologies jumped to nearly $643 billion in 1997 from $452 billion in 1992. Demand for personal computers has soared as they have become more affordable and attractive to the average consumer. Personal computers in schools and homes alone have more than doubled during the eight-year stretch of U.S. economic growth. Internet use has also rocketed, spawning new business ventures and employment opportunities. The high-tech industry's expansion has flooded the labor market with high-paying jobs, fattening workers' wallets and adding to the strong demand economists say has buoyed growth. Federal Reserve Chairman Alan Greenspan has credited technology with significantly boosting productivity, thus taming inflation pressure. This, analysts say, has allowed him to keep interest rates low. President Bill Clinton has said technology shaved one percentage point from inflation. While job growth in the software and computer service sector is booming, some economists question whether the tech sector can sustain its current pace. They note that tech spending could take a hit as the boost from fixing the millennium computer bug wears off next year and overall U.S. economic robustness begins to fade.