From AVL Watchdog: How tech can help Asheville’s economy

By Steven J. Vaughan-Nichols, AVL Watchdog

In 2019, if you were to ask anyone what drove Asheville’s economy, they’d tell you beer, arts and crafts, outdoor recreation, hotels and restaurants. In short, tourism.

Today, with those businesses only just beginning to ramp back up and tourists staying home, talk of diversifying Asheville’s economy is picking up. Local technology businesses and the rise of technology-based work-from-home jobs may be part of the solution.

Asheville already has a tech sector, albeit a small one, with only 1% of the job market and approximately 1,900 jobs. But with an average salary of nearly $58,000 a year, according to ZipRecruiter, Western North Carolina tech jobs are good ones. And, more jobs are coming.

Charles Edward Industries (CEI), a minority-owned electronics manufacturer, in concert with the Buncombe County Board of Commissioners, Asheville City Council and the Economic Development Coalition for Asheville-Buncombe County (EDC), has announced plans to move its headquarters to Asheville and invest $1.5 million over 3 years in a new manufacturing operation.

With this new factory, which will be next door to Moog Music on Broadway, will come 60 new assembly and production, engineering, management, and administration jobs. These jobs will have an average wage of $46,925 — roughly 110% of the Buncombe County average wage. Hiring is expected to start in fall 2020.

Why Asheville? CEI President Tim Harmon says, “We see great promise for our company in Asheville and view the community’s workforce as a key competitive advantage as we seek to grow the business to new heights.”

As good as this news is, the infrastructure is there for more tech jobs.

Immedion Asheville, a business data center in the Biltmore Park Town Square, has “helped many organizations transition to remote workforces” and bolster their computer-based systems since the pandemic, said sales manager Steve Newman. “We see growth in our future for revenue or operations.”

Asheville is “fortunate to have several organizations like Meet the Geeks, HATCH, Venture Asheville, A-B Tech, and Montreat College that are dedicated to helping promote and foster the technology industry in our area,” Newman said. “My hope is that those groups will continue to expand.”

For technology businesses to run anywhere requires broadband Internet. Thanks to the Education & Research Consortium of the Western Carolinas (ERC), Western North Carolina has access to up to extremely high-speed 100 gigabit per second broadband internet access primarily to the education, healthcare and government sectors.

The nonprofit ERC, which works with most broadband providers, has seen “a 10-15% overall increase in internet traffic,” said CEO Hunter Goosmann.

“Some businesses have needed additional bandwidth, but the greater demand has been from homes,” Goosmann said. “You can imagine that whether it’s someone logging in for work or watching Netflix, internet use has increased.”

Charter/Spectrum, the area’s biggest internet service provider, has met the demand.

“We built our networks to exceed maximum capacity during peak evening usage, and even with the increased network activity we are seeing in the daytime, levels remain well below capacity and typical peak evening usage in most markets,” said Patti Braskie Michel, Charter/Spectrum’s senior director of regional communications.

The ability of the internet to hold up under the load opens other job possibilities for Asheville. The Society for Human Resources Management (SHRM) has found 17% of U.S. companies are adding permanent work-from-home policies for employees. This comes after major companies such as Google, Facebook and Zillow announced their staff can work from home for the rest of 2020.

Companies that once dismissed the idea of employees working from Asheville out of hand are now much more open to the idea of remote workers.

Asheville also has its own home-grown technology businesses. They’re experiencing rough times but are doing much better than the companies relying on tourism.

Local company Epsilon, a Weaverville IT consultancy, is doing well and welcomes the telecommuting trend.

“We have been quite busy supporting customers that are getting used to working remotely,” said Matt Fraser, the company’s director of business development. “Over the years, Epsilon has stayed at the forefront of cloud technologies, which allow businesses to operate anywhere anytime, so many customers just needed a short learning curve to be able to work at home. In addition, we find that 70% to 80% of technical issues can be resolved remotely.”

Technology programs at A-B Tech and Montreat College, as well as organizations like the Mountain Area Workforce Development Board, “continue to drive technology jobs in the area,” Fraser said.

Status Forward, a small Asheville-based web design, development and marketing agency, has seen a rougher road.

“We have actually reduced our staff from 6 to 5 in the last two months,” said Leah Quintal, digital marketing strategist. “We have adapted by shifting the scope of our offerings…[We] developed and launched the Supply Connector, a searchable directory site that connects manufacturers that have pivoted operations to provide PPE [personal protective equipment] with the healthcare industry and essential providers that most need equipment. Should we get additional funding to support this effort, we will likely be able to hire additional staff.”

What’s ahead for Asheville’s tech businesses? Trevor Lohrbeer, a local tech entrepreneur who has launched several start-ups, sees potential.

“I don’t see Asheville becoming a major tech player, though I do think the tech industry could be built up to the point where it contributes significantly to the local economy,” said Lohrbeer, who’s also the founder of Meet the Geeks, a local technology networking nonprofit. “What I think we’ve seen over the past 20 years is that startups can now be started anywhere in the world.”

It helps to be in a startup hub like San Francisco or Boston.

But “it used to be almost impossible to build a significant tech company outside Silicon Valley,” Lohrbeer said. “Now, it’s possible in many more places around the world, including Asheville.”

Some Asheville-born tech start-ups, including Home Gauge, RISC Networks, and Doctor Directory, have already grown and been acquired by national companies.

Asheville now has tech-savvy angel investors, and “as we continue to build our entrepreneurial ecosystem through initiatives like Venture Asheville, I think we’ll see growth in the local tech industry,” Lohrbeer said.

Jeffrey Kaplan, director of entrepreneurship at Venture Asheville, is optimistic “that entrepreneurs will lead our recovery.” Venture Asheville and its partners have raised $25,000 in support of the Asheville Impact Micro Grant.

“We’re thrilled to help jump-start five new companies,” Kaplan said.

With working from home more of an option now, Asheville is attracting more employees from bigger markets.

“Several startup founders have told me that a majority of applicants to open positions are coming from New York, Boston, and the Bay Area,” Kaplan said. “We’re seeing something of an urban exodus from major metros with people choosing locations that offer more balance, amenities, and a better lifestyle overall.”

Asheville will become “a regional health care innovation powerhouse,” Kaplan said. “Our unique ‘weirdness’ is an asset for startups to bootstrap and solve problems creatively.” What that means is that there will be more local competitive jobs.”

Don’t expect Asheville to become Boulder or Seattle, “which I think we all were aiming for 10-15 years ago,” Lohrbeer said.

“But since we’re starting to see the downsides of unplanned growth in the tourism industry, perhaps that’s a good thing,” he said. “Building a tech industry here that supports work-life balance and the ‘good living’ culture that Asheville is known for would be a success in my eyes, regardless of its size.”

AVL Watchdog is a nonprofit news team producing stories that matter to Asheville and Buncombe County. Steven Vaughan-Nichols is an Asheville-based freelance writer specializing in economics and technology. Contact us at avlwatchdog@gmail.com.