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Download Here: 2016 Massachusetts Edtech Workforce Report

Education and the education technology (edtech) sector have grown to become a significant part of the Massachusetts economic engine and have fueled the Commonwealth’s rise to global prominence as a leader in education.

While the news on edtech is quite good, there are notes of caution that must be taken seriously in order for this accelerating industry to continue gathering speed.

The Education Market on the Move

With a public K­12 system that is the top performing in the nation, and 125 degree granting higher education institutions, it is not surprising that Massachusetts is the recognized leader in education. People come from around the world for Massachusetts’ education system – indeed, “education,” is part of our global brand. The business of education is also a job creator for the Commonwealth. Today, Massachusetts boasts over 200,000 jobs connected to the delivery of education, not including jobs in corporate training.

“Technology,” too, is part of our global brand – education technology has long been a focus of local innovators and area schools, delivering benefits to the economy, as well as to students of all ages. By itself, the education technology (edtech) sector is a significant job generator. As the Workforce Report reveals, today there are 430 companies just in the edtech space in Massachusetts, supporting an impressive 25,000 jobs.

Powerhouse companies like Houghton Mifflin Harcourt, Pearson, McGraw Hill Education – which opened an R&D lab in Boston ­ and Cengage Learning ­ which moved its global headquarters from the NYC area to what has become the Innovation District ­ anchor Boston’s edtech ecosystem. Technology giants – but newcomers to education ­ Microsoft, Google, and Amazon all maintain education teams and projects in the area. Other important players in the edtech ecosystem include Curriculum Associates, Rosetta Stone/Lexia, and LEGO Education, which moved the Denmark­-based toy giant’s educational business from Kansas to Boston in 2015.

The Bay State’s edtech strength is recognized worldwide, and global companies are helping fuel its local growth. Edtech companies have started coming to Boston from digital hot spots like Ireland and Israel, the booming markets of Asia, as well as the rapidly evolving economies of the Persian Gulf. Also located in Massachusetts is the edtech acquisition arm of Chinese gaming giant Net Dragon and a part of the investment office for Japanese leader EduLab Group.

Massachusetts has active innovation networking organizations, specific communities of practice, seasoned mentors, and a deep pool of angel investors and venture capitalists. Many of these are now increasing in supporting edtech startups. Many universities and other accelerators are now also actively supporting edtech teams.

There are no signs of a slowdown in edtech. With industry investment up, 90% of the edtech companies interviewed reported they are hiring and adding jobs.

Massachusetts has many unique qualities and attributes that are impossible to replicate elsewhere. However, recognizing the potential to impact their economies, school performance, and job creation, other states have launched aggressive efforts to recruit edtech companies and grow their own edtech clusters. Colorado, Maryland, Illinois, and New York all have quickly blossoming edtech industries.

Indeed, sometimes states with poorer performing education sectors have a greater incentive to innovate in order to improve. California, anchored by the start­up culture of Silicon Valley, is estimated to be receiving roughly 50% of edtech investment. The Bay Area has emerged as a strong magnet for investment dollars, compounding the difficulty of raising money in Massachusetts. Organizations like ours here at LearnLaunch, are aiming to change this dynamic.

Lessons to Learn from the Past

The parallels between edtech at the start of the 21st Century and healthcare at the end of the 20th Century are intriguing. Both health IT/ life sciences and edtech serve sectors characterized by strong professional cultures, a high degree of regulation and institutions with both for profit and nonprofit models. Area hospitals, universities, research labs, savvy investors, and local government have worked together to drive innovation, share research and development, fund important breakthrough efforts, and create an environment that has seen our Life Sciences industry boom into a global leader.

Edtech may represent a similar opportunity. Educators increasingly incorporate digital tools into their teaching and administrative processes. So Massachusetts’ strength in digital systems, big data, brain science can be combined with a deep knowledge of instructional design to support growth of a leadership cluster. The Commonwealth; its investment community; area schools, colleges, and universities; as well as leading individuals, companies, and organizations must join together to ensure that the impressive economic impact the edtech industry already makes on Massachusetts continues to grow.

Today, Massachusetts is a global leader in edtech, something in which we can rightfully take pride. Even with 25,000 jobs, the edtech industry is at an inflection point. With other states nipping at our heels to recruit these companies and jobs, and a global marketplace that is increasingly borderless, all the stakeholders in the edtech industry need to recommit to cooperation and partnership, with the Commonwealth’s elected and other officials championing efforts to ensure our continued global leadership in education technology.

This Workforce Report is a step to strengthen Massachusetts’ edtech ecosystem. We are convening a taskforce of local edtech leaders to collectively address this important economic opportunity. The results will be for the good of the Commonwealth (and its students), as well as for the edtech industry as a whole.