Digital dexterity at work.

• Position: North Carolina's high technology industry - Industry Overview

The expanding high-tech industry shows it has a real feel for what's hot and (sometimes) what's not.

North Carolina's high-tech industries are so diverse that it's almost impossible to characterize what sort of year they had as a group.

Verbatim Corp., for instance, laid off 100 of 300 Charlotte employees less than a year after shutting down its Cleveland County optical-disk plant. The company cited Japanese competition. And IBM, with big operations in Charlotte and the Triangle, continued its layoffs and reorganization.

"We saw some downsizing and re-engineering in all three of our big telecommunications companies - Southern Bell, AT&T and Northern Telecom," says Betsy Justus, director of the North Carolina Electronics & Information Technologies Association in Raleigh. "This will continue to take place as they focus on efficiency and productivity."

At the same time, she adds, "a real strong growth spurt" in companies with $20 million or less in sales kept employment in telecommunications, electronics and computers around 140,000, down only slightly from 1993. The number of companies may rise to nearly 3,800 in the coming year, up about 100 from 1994, as the growth of software developers and others, often with fewer than 50 employees, continues.

Last year, the N.C. Information Highway remained the focus of high hopes, but the giddy projections of two years ago - such as its potential to boost state gross product by $2.7 billion - began to get more scrutiny. Estimates of taxpayer cost rose to $130 million a year, and wary legislators approved only $7 million, mainly for initial fiber-optic hookups between schools, hospitals and some state offices. The first 109 sites were linked in August, and 85 more will be announced in January.

"North Carolina now has a competitive edge over neighboring states," says Katherine Barrett, a Financial World editor. "To be sure, the state is taking an enormous risk. Technologies change overnight, and it could find it has made major mistakes. But it is only the states that take risks that wind up leading the pack."

After the euphoria in 1993 over what the system might do, 1994 was the year of "buckling in and getting down to business," Justus says. This fall, the N.C. Utilities Commission will set rates for public and private users. Analysts say businesses will almost certainly get the stiffest tariffs, but they could also benefit the most, largely from linkups with data bases.

"Everybody knows we're going to...