More Payroll, Fewer Jobs: The New Shape of Pittsburgh’s Tech Economy

There is a number in this report that I cannot stop looking at. Information technology employment in southwestern Pennsylvania fell 5.5 percent over three years. Average wages in that same cluster rose 23.3 percent, to $150,958. Software wages now average $181,607. These figures reflect total wages paid executives and sales included across our technology companies.

That is not a rounding error, and it is not a good news story dressed up as a caution. It is the single most important fact about our regional economy right now, and it should sit with all of us because it means our technology economy is producing more wealth for fewer people. All the while our overall growth rate in this region remains largely flat.

I have spent nearly two decades watching this region’s data. I can remember when we argued about whether Pittsburgh had a technology sector at all. That argument is over, and the numbers in this report settle it: 9,179 technology establishments; 241,120 people; and $24 billion in annual payroll which is more than 28 percent of every wage dollar earned across our 13 counties. Average technology wages of $104,770 against $72,070 for all other industries. We are a technology economy. We have been for a while. The question in front of us now is not whether we have one. It is who participates in it.

What the data actually tells us

Look across the clusters and the same shape keeps appearing. Information technology, the cluster I opened with: establishments up 6.6 percent, employment down 5.5, wages up 23.3. Life sciences: establishments up 8.3 percent, employment down 5.1, wages up 11.6. Environmental technology: employment down 10.1 percent, wages up 17. Advanced materials: employment flat, wages up 12.8. Every cluster in this report grew total payroll over three years. Most of them shed positions while doing it. One cluster showing that pattern is an anomaly. Most of them showing it is a structure, and this is the first edition of this report in which I believe the pattern is unmistakable rather than merely suggestive.

Now look at the exceptions, because they are telling us something. The only clusters that added people over the three-year period are the ones that make and move physical things. Advanced manufacturing added employment. Energy technology added employment. Health services  is the largest single subcluster we track, at nearly 106,000 people and $9.8 billion in payroll  added employment. (Note this does include health care workers in hospital settings.) The digital clusters, the ones this region’s reputation was rebuilt on, are producing more wealth with fewer hands. The atoms are hiring. The bits are consolidating.

That is not a failure. Rising wages reflect rising value per worker, and a software cluster paying $181,607 on average is a genuine asset. But a regional economy is not measured only by its averages. It is measured by how many people the prosperity reaches, and compression  richer, not bigger  is a trajectory that eventually collides with the civic promise this region has made to itself.

The pipeline FLOWS both ways

The inputs to our future look strong on paper. University research and development spending reached nearly $2.3 billion, up 26 percent over three years, with the University of Pittsburgh ranked 17th nationally and Carnegie Mellon spending more than $226 million in computer sciences alone. SBIR and STTR awards jumped 48 percent to $59.2 million. Graduate enrollment in science, engineering and health fields reached 13,756, the highest mark in the three-year window.

But the risks attached to that pipeline are not hypothetical. National Science Foundation funding has fallen to its lowest levels in decades. The SBIR/STTR program lapsed for more than six months before its April 2026 reauthorization, and I expect that gap to show up in next year’s award data. A region whose competitive advantage runs directly through federally funded research should read those two facts with full attention, because the pipeline is the one part of this story we cannot rebuild quickly once it thins.

A word about the instrument

Credibility is the only asset a report like this has, so two notes of honesty about the data itself. First, we changed our methodology this year to eliminate duplication where establishments carry multiple NAICS codes. The top-line totals are cleaner as a result, but they are not perfectly comparable to prior editions, and we will not pretend otherwise. Second, some of what appears as contraction – environmental technology’s 14 percent drop in establishments, for instance – may partly reflect reclassification rather than reduction.

And there is a third, larger truth: some of what is growing fastest in this region is barely visible to the instruments this report relies on. The data center buildout reshaping our energy demand, our land use and our capital flows does not yet register cleanly in employment statistics built for an earlier economy. The same is true for parts of our defense and autonomy work. When the most consequential investments in a region do not appear in its official measurements, the answer is not to ignore them. It is to build better instruments, and the Tech Council intends to.

The work

These wages will not grow our population by themselves: people move for open positions, not for averages. But paired with housing costs our coastal competitors cannot match, they give this region a genuine standard-of-living advantage, and converting that advantage into net new seats is the work in front of us. Attracting companies to the region, supporting the growth of entrepreneurs, building strategic relationships with established and newer companies alike, and driving capital investment are the crucial variables that must be our collective priorities.

What this data tells me is not that the region is faltering. It is that our prosperity is compressing into fewer, higher-paid positions while broad-based hiring has shifted to manufacturing, energy and health care. Strategy must follow that reality: connect the wage engine to more of our people, build deliberately in the physical economy clusters where the hiring is, and defend the research pipeline that feeds all of it. The numbers in this report are a baseline, not a verdict. What we do with them is the work, and it belongs to all of us.