Companies need scientists for R&D, of course, but a new study finds that U.S. manufacturing companies seeking high productivity and earnings should consider hiring scientists for jobs other than R&D as well.
The study, to appear in the forthcoming book “U.S. Engineering in a Global Economy” from the University of Chicago Press, concludes that productivity is higher in manufacturing establishments with high levels of scientists and engineers than in companies with low levels of technical people. A one percentage point higher share of scientists and engineers in a company’s workforce is associated with productivity that is almost half a percentage point higher, according to Andrew J. Wang, an economist with Harvard University and the National Bureau of Economic Research who coauthored the study.
Moreover, productivity increases as employment of scientists and engineers increases, the study found. And employee salaries are higher in manufacturing companies with high numbers of technical people.
Most studies of how scientific and engineering knowledge affects the economy focus on R&D’s impact on patents and intellectual property. But most industrial scientists and engineers, the study points out, work in activities other than formal R&D. In fact, using data from the U.S. census and other government surveys, the study’s authors found that the primary work of more than 60% of industrial scientists is non-R&D.
Wang and colleagues suggest that firms with high numbers of scientists and engineers are productive because scientists, even those not involved in R&D, help ease the adoption of new technologies at workplaces. “They are ‘part of the package’ for implementing technology in production processes at the plant level,” Wang says.