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Technology business impacts local economy

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By Tiffany Young Friday, 28 November 2008

National Instruments, Austin’s 10th largest privately owned employer, has played a role in Northwest Austin’s economy and development for the past 32 years.

After moving and expanding to seven different locations in and around North Austin, the company finally settled into a location in 1994 that still has room for growth.

The lush green scenery of NI’s 69-acre campus makes it easy to forget it is right off MoPac and across the street from Northwest Austin’s largest retail mall, The Domain. The land, purchased from IBM, is only about half developed with a 140,000 sq. ft. manufacturing and office facility, a 232,000 sq. ft. office facility, a 380,000 sq. ft. research and development facility, parking lots, trails, a volleyball and basketball court and picnic tables coursing through a dense forest of trees.

Products

While many people get NI confused with Texas Instruments, NI does not make graphical calculators and is not associated with the Dallas-based company.

In 1977, Jeff Kodosky, Bill Nowlin and Dr. James Truchard (known to employees simply as Dr. T), who were still employed at the University of Texas’ Applied Research Laboratories, constructed NI’s first product, a general-purpose interface bus (GPIB) for the PDP-11 microcomputer, the GPIB-11.

All three founders quit their jobs at UT in 1980 to make the leap to full time at NI. Three years later, the company created its first GPIB product to connect instruments to IBM PCs. That same year, Kodosky began research on a project that would redefine the company and the industry: LabVIEW, short for Laboratory Virtual Instrument Engineering Workbench. LabVIEW, which was released in 1986, is a graphical programming language that lets engineers design efficiently without the use of textually coded languages such as Visual C/C++ and Visual Basic.

Since 1995, NI has been holding NIWeek, an event that attracts developers from around the world to learn about new and improved features and capabilities of LabVIEW.

“They host what’s called NIWeek every year in Austin which brings in thousands of people for a conference on their new products,” said Susan Davenport, vice president of business retention and expansion for the Greater Austin Chamber of Commerce. “So, they’re exposing people from all over the world to Austin, and that also has a benefit to the area.”

In August, NI rolled out the latest version of the graphical system design software platform, LabVIEW 8.6.

The company

NI, which started in Truchard’s garage in 1976, is known for being a good employer, ranking in FORTUNE magazine’s “100 best companies to work for” list for nine consecutive years.

This past year, NI won the Spirit of Caring award from United Way for programs that include employee volunteering, educational opportunities and financial investment.

“The founder and CEO, Dr. James Truchard, clearly is a great Austinite and someone who, from the tech industry, has been an avid supporter of Austin,” Davenport said. “He’s very supportive of the University of Texas at Austin and a good philanthropist, which is a huge benefit to our regional economy just in and of itself.”

Economic impact

With more than 2,200 employees in Austin and more than 5,000 employees worldwide, NI’s economic impact is far-reaching.

Vice President of Human Resources Mark Finger estimates that about 85 percent of NI’s hires are from outside the company.

“NI recruits young graduates from all over the country, so they’re a huge driver of bringing in new talent to Austin and helping acclimate that talent to the area,” Davenport said. “Bringing in that talent, they are helping to infuse this whole region with the best and brightest [who bring] ideas, and it just really grows the talent base in the economy, in addition to growing the economy.”

Not only does the number of new jobs being created have an effect on the local economy, but also having those employees living in the area creates economic opportunities.

“They create good jobs with good salaries, and that’s a positive impact on the area,” Davenport said. “As you look at a primary employer and its salaries and wages, if [employees] live and work here, it helps drive a lot of the local economy — retail, restaurants, living and real estate — all the things that make up our local economy.”

Aside from its local impact, NI has direct operations in more than 40 countries. While many companies have hiring freezes and have had layoffs recently, NI is still hiring.

“We’re proud of the fact that as we moved products over [to Hungary] we did not do a single workforce reduction,” Finger said. “There are very few companies that can say that. It’s easy to be a good company when things are good. You find out if you’re a good company when times are tough. If you go back to 2000-2001, NI was one of the few companies in Austin, certainly high tech, that got through without laying people off. We made some tough choices to protect jobs.”

Engineers

The United States is falling behind on the number of engineers it produces compared to its need. NI employees volunteer at local schools to try and change that trend.

“We’re not getting enough engineers graduating from college, but when we look at root causes of that, we’re not getting enough going into engineering schools to start with. It’s really a systematic problem of how much our science and math education is hurting in the K-12 area,” said Amanda Webster, NI’s manager of community and employee relations. “One of the neat programs we have is that we have this wealth of knowledge on this campus in North Austin, and we send our engineers, almost 200 now, into the classrooms every week to mentor classrooms using our Lego Robots, which gets those kids engaged and brings in training to help partner with school districts.”

National Instruments

More than 90 percent of National Instrument's revenue comes from its virtual instrumentation and graphical system design products.
National Instrument’s customers are engineers, scientists and technology professionals in industry, government and academia.
In 2007, NI delivered an all-time revenue record of $740 million, up 12 percent year-over-year.

Source: National Instruments

Top 20 employers in the greater Austin area		Source: Greater Austin Chamber of Commerce
	Company	Industry	Employees
1	State of Texas University of Texas at Austin Texas State University-San Marcos	Government Higher education, public Higher education, public	65,941 13,284 2,140
2	Dell Dell Financial Services	Technology (headquarters) Financing & related services for computer maker (headquarters)	17,000 1,100
3	City of Austin Austin Energy	Government Electric utility, municipal	12,000 1,600
4	Austin Independent School District	Public education	10,610
5	Federal government U.S. Internal Revenue Service	Government Government (regional call & processing center)	10,405 4,500
6	H-E-B	Grocery retail/distribution	6,746
7	Seton Healthcare Network	Healthcare (headquarters)	6,700
8	IBM Corp.	Computer systems, hardware, software and chip R&D	6,239
9	St. David’s HealthCare Partnership	Healthcare (headquarters)	6,219
10	Round Rock Independent School District	Public education	5,175
11	Freescale Semiconductor Semiconductor	chip design & manufacturing (headquarters)	5,000
12	Travis County	Government	4,000
13	AT&T	Telecommunications (headquarters of Texas operations)	3,450
14	Apple	Computer maker’s tech & administrative support center	3,000
15	Flextronics (formerly Solectron)	Contract electronics manufacturing & integrated supply chain services	3,000
16	Leander Independent School District	Public education	2,759
17	Austin Community College	Higher education, public	2,612
18	Advanced Micro Devices	Semiconductor chip engineering, marketing & administration	2,300
19	National Instruments	Virtual instrumentation software & hardware manufacturing (headquarters)	2,282
20	Applied Materials	Semiconductor production equipment manufacturing	2,250