Knowledge is power. What could you do if you knew all of the photonics companies in your state? What could all of the photonics companies do if they knew they produced significant numbers of jobs and tax revenue—and rate of growth for each—just within your state? What could be the benefits of having photonics integrated into your state's strategic technology plan—in terms of tax credits, talent recruitment, job training, funding, or school curriculums?
In July 2013, New Mexico's senators, economic development directors, educators, business leaders, and local investment community asked the New Mexico Optics Industry Association (nmOptics; http://www.nmoptics.org) to explain how important is "this photonics thing"? They asked: "What is photonics?", "How important is it to the national and local economy?", and "How do we ascertain what we need to do in New Mexico to get on the photonics train?"
In response, nmOptics prepared a presentation beginning with "A Day in Your Life and the Impact of Photonics," and ending with the National Academies Report, Optics and Photonics, Essential Technologies for Our Nation and the National Photonics Initiative (NPI).
The GDP impact
Virtually everything we touch in our modern world is impacted by photonics. Everything either contains photonics, is manufactured with the aid of photonics, or its distribution is made economically feasible with photonics. Photonics impacts every single GDP category.
When viewed through the GDP impact, the pervasiveness of photonics in our everyday lives becomes a compelling argument for raising public awareness of our industry and pressing local leadership to positively impact its growth and maturity. Our state leadership was convinced that New Mexico needed to quantify what we had with regards to companies, jobs, and technologies, and how the public and private NM economic development leadership could better promote and develop our state-based photonics industry.
Two agencies—the City of Albuquerque Department of Economic Development and the New Mexico Manufacturing Extension Partnership (MEP)—and SPIE (Bellingham, WA) sponsored nmOptics and its subcontractor, Logical Marketing (Cedar Crest, NM), to research and develop a comprehensive report on the optics and photonics industry in New Mexico.
Quantifying photonics
New Mexico's efficient and thorough process was based on a credible "bottom's up" approach that identified each and every player. We broke the project into four phases: (1) creation of an initial dataset of photonics companies, employees, and revenues; (2) confirmation of original dataset with personal surveys of identified corporations; (3) creation and confirmation of the educational assets (community colleges, four-year colleges, and universities); and (4) compilation and distribution of the report.
For Phase 1, we created an initial dataset of 9000 "technology" companies using a commercial database product. These technology companies were then investigated by a "technology savvy" graduate student workforce and quickly filtered down to a group of 600 "potential photonics" companies. These 600 companies were investigated by Logical Marketing and filtered down to a list of 120 companies that conformed to the definition of photonics companies as is currently being used by SPIE in its NPI work (core photonics manufacturer, photonics systems integrator, or photonics-enabled manufacturers). Revenues, employee counts, addresses, and North American Industry Classification System (NAICS) codes were populated from the commercial database product.
Second, the list of 120 companies needed to have data confirmed, a photonics factor applied (not all of the companies were 100% photonics), and open-ended survey questions collected about growth constraints. Logical Marketing surveyed each company through a series of direct mail pieces, email, and in-person phone calls to the executive leadership team of each company.
Third, in an analogous process, a dataset of colleges and universities was created, identifying degrees granted, patent portfolios (what percent were photonics), faculty, and areas of expertise and unique assets located within the state. Confirmation of IP licensing, where college graduates find employment, collaborations with firms or government laboratories, and number of graduates per year was executed via email and phone surveys.
Finally, the data was organized and compared to key state metrics with a final report released in January 2015.
Photonics matters; benefits of a local study
In New Mexico, 96 photonics companies employ 21% of the manufacturing workforce and generate 8% of the manufacturing revenues for the entire state (see table). Furthermore, 33% of the patents assigned to entities (schools, government laboratories, firms, and private individuals) within the state are photonics-based (utilize, create, or enable photonic-specific technology).
That photonics is a pervasive technology in New Mexico was clearly demonstrated by this analysis of the patent database. In retrospect, this fact is not surprising in light of all the technology areas that use photonics, including basic research, imaging, communications, data storage, manufacturing, security, lighting, displays, test and measurement, semiconductor manufacturing, and solar energy. And yet, the study quantifiably and demonstrably brought home that message to every economic and political leader who read the report.
This bottom's-up database of companies defined an industrial cluster large enough to garner the attention of economic developers and is already being used to drive trade missions, recruit companies to locate or relocate a division, to develop job-creation incentives, and to raise awareness of state programs to facilitate local company growth. Albuquerque Economic Development (http://www.abq.org/) is using the study results to organize business recruitment activities at Photonics West in 2016. New Mexico's Office of International Trade (http://www.gonm.biz/International_Trade.aspx) is using the database of companies to create a New Mexico photonics company cluster at Laser 2015 in Munich, Germany—sharing the costs of an expensive international tradeshow across multiple small businesses enables their participation, whereas in the past it would be too expensive to bear by one company alone.
The economic impact of New Mexico photonics is an important story to tell state political leaders who hail from varied backgrounds and live hundreds of miles from technology centers. By bringing visionary leaders together that understand "the photonics industry" as a whole, companies that manufacture medical equipment, for example, may spend a little less time thinking they are purely a medical device company and instead, spend some time realizing they also belong to "the photonics industry" supply chain.
Leadership can also begin to engage with local educators to create the workforce of the future: trained or knowledgeable about physics, mechanics, and photonics. And finally, both leadership and individuals can engage with politicians and influence regulations, policy, and taxation using rational arguments based on data. In summary, New Mexico is focused on a bright future for photonics; other states interested in quantifying their photonics industry can follow in our footsteps.
Lynore M. Abbott is Logical Marketing founder and VP of nmOptics; email: [email protected].