Issue Date: January 23, 2012
U.S. Competitive Edge Narrows
The U.S. remains the world leader in terms of high-tech manufacturing and R&D investments. Its lead is shrinking, however, according to the latest edition of “Science & Engineering Indicators” (SEI), released last week by the National Science Board (NSB), the policy-making arm of the National Science Foundation.
The data-heavy biennial report shows that, over the past decade, the U.S. lost more than a quarter of its high-tech manufacturing jobs. At the same time, U.S. companies rapidly boosted their investments in R&D overseas. China, the NSB study shows, is now the world leader in exports of high-tech products.
“The new data tell us a great deal about the competitiveness of our economy and the dynamics of an increasingly globalized arena of scientific and economic activity, including the performance of other developed nations and the rise of new players on the world stage,” SEI Chairman José-Marie Griffiths said at a Jan. 17 briefing.
The report indicates that scientific research and high-tech manufacturing are continuing to shift from the U.S. and the European Union to Asian countries, including China and Japan, as well as India, Indonesia, Malaysia, the Philippines, Singapore, South Korea, Taiwan, and Thailand. Those 10 countries are “ramping up R&D expenditures as all of them are trying to build a more knowledge-intensive and technology-intensive economy,” said Rolf Lehming, director of the SEI program at NSF’s National Center for Science & Engineering Statistics.
For the first time, combined R&D expenditures from the 10 Asian countries matched the $400 billion invested in R&D by the U.S. in 2009, the most recent year for which data are included in the report. Much of the growth in Asia is driven by China, where R&D growth increased by a record 28% from 2008 to 2009, according to the report.
China also boosted its number of natural sciences and engineering graduates, from about 280,000 in 2000 to 1 million in 2008. For comparison, the number of natural sciences and engineering graduates in the U.S. was 248,000 in 2008. Natural sciences include mathematics and physical, biological, environmental, agricultural, and computer sciences.
The report also reveals that R&D spending by U.S. multinational companies is growing much more rapidly abroad than in the U.S. The total amount spent overseas shot up from $26 billion in 2004 to $37 billion in 2008. And the number of overseas R&D jobs at U.S. companies shifted from 16% to 27%, the report states.
The data worry U.S. officials who say the trends show the U.S. is slipping in innovation and economic competitiveness. “We’ve seen now, not just one indicator changing, but several indicators changing,” Griffiths said. “Any one on their own might not necessarily raise the alarm, but the continuing increase in the trends of these indicators is indeed cause for concern.”
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