The Department of Commerce is urging states to use some of their collective $42.5 billion in broadband infrastructure subsidy funds to help build the workforce needed to build out fiber-based broadband and close the digital divide.

That was one of the recommendations in a new report on information and communications technology (ICT) and protecting the communications high-tech equipment supply chain, including undersea cables, modems, fiber optic cables, bridges, routers, and gateways.

"[T]he COVID-19 pandemic and related disruptions have exposed structural vulnerabilities in both domestic and global supply chains that have reduced the availability of critical ICT products and the resiliency of the ICT industry as a whole," said Commerce Secretary Gina Raimondo and Homeland Security Secretary Alejandro Mayorkas Thursday (February 24) about the report assessing the supply chain.

Businesses all over the country are having trouble attracting workers and the broadband technician sector is no exception.

The U.S. ICT industry’s struggle to find qualified workers threatens its ability to fulfill increased demand for key ICT products, impacting implementation of federal and state broadband programs as well as measures to increase manufacturing in the United States," the report concludes.

It also talks about the importance to broadband of continuing to lay fiber optic cable using domestic suppliers, saying that the industry "is currently facing challenges related to supply and demand shifts and bottlenecks."

One of the problems the report identifies is China's excess fiber capacity of hundreds of millions of kilometers that, combined with tens of millions of dollars per company in government subsidies, allows Chinese fiber exports to undercut prices in the U.S. and threaten the viability of domestic suppliers. ■

The Telecommunications Industry Association says that U.S. information and communications technology (ITC) spending totaled $1.45 trillion in 2015. That was up 5.7% from 2014, which had seen a 5.3% increase over the year before.

That is the good news. The bad news is that the twentieth annual ICT Market Review & Forecast predicts declines in those growth rates over all ICT market segments over the next five years, though that is attributed to maturing tech and more targeted spending.

The report was unveiled at TIA's Network of the Future show in Dallas.

Helping drive the increase in 2015 were cloud computing, business Ethernet, and Internet of Things (IoT0, which were among the so-called "pacesetting markets," or ones with double-digits growth. Cable operators use Ethernet technology to deliver some business service, as well as an Ethernet-over-hybrid fiber coax (HFC) platform that some MSOs are using, and ISPs are well positioned as a gateway to IoT.

Not surprisingly given the move to IP delivery, among the "legacy technologies and services" category--those with long-term declines--were circuit-switched landlines.

In total, the pacesetting markets were up 19.5% year-over-year.

As to the predicted declines in spending percentages, TIA CEO Scott Belcher said: “And while growth will continue almost across the board, it’s clear that the surge in ICT spending over the last decade is moving towards a more modest rate. This change is the result of maturing technologies, in which costs are lowered and companies are better able to target spending."

Smart phones contribute to that decline, something of a victim of their own success. "Between 2010 and 2015, U.S. smartphone spending increased three-fold, from $17.6 billion to $52.9 billion," the report points out. But now with penetration at almost two-thirds (68%), it predicts that spending will slow dramatically, from 8.3% annual growth in 2015 to only 1.2% in 2020.

Belcher sounded a warning note about the impact of government regs. "U.S. companies could face more dramatic spending growth declines if Washington continues to try and impose heavy handed rules, such the FCC’s Internet regulation plan," he said in releasing the report. "Now more than ever, government leaders need to be forward-thinking and pursue policies that encourage private sector innovation and investment.”