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NSF PR 96-22 - May 20, 1996
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Major Shifts in World Economy Confront U.S. Status
as Industrial Leader, Says New S&E Indicators
Report
Recent shifts in industrial research and development
(R&D) in the United States and abroad -- especially
in Asia -- are narrowing the margin of technological
advantage of U.S. firms, according to a new government
report. The U.S. remains the leading performer of
R&D by a wide margin, accounting for about 44
percent of the industrial world's investment, although
America's share has declined over the last two decades.
These observations are among hundreds of trends and
statistics in the just-released National Science Board
report, Science and Engineering Indicators 1996. The
Board oversees the National Science Foundation, which
produces the biennial compendium of vital statistics
to help decision-makers assess the performance of
the nation's science and engineering (S&E) enterprise.
"The health of the science-technology enterprise of
the United States is the main thing that stands between
us and a lower-wage future," says Robert M. Solow,
winner of the 1987 Nobel prize in economic science,
an economist at the Massachusetts Institute of Technology,
and a member of the National Science Board.
In referring to the S&E Indicators report, Solow
says, "This fat volume is the prime source of basic
data about the whole system, from the education of
students to society's gain from R&D investment.
It should be studied, thought about, and acted upon."
Cora B. Marrett, assistant director for the National
Science Foundation's Directorate for Social, Behavioral
and Economic Sciences, says "Science and economic
growth have become increasingly integrated and global.
We prepared the Science and Engineering Indicators
report to meet the needs of leaders for relevant and
reliable data to assess international opportunities
and to make informed decisions affecting our nation's
future."
According to S&E Indicators, while U.S. industrial
R&D expenditures are greater than all industrial
sectors of the European Union combined, and twice
the industrial R&D performed in Japan, major shifts
in the U.S. and abroad threaten to narrow America's
margin of technological advantage. In the 1990s industry
funding in real dollars generally was flat and federal
funding fell (In the U.S., industry now funds about
60% of R&D; the federal government, 36%).
Other major data reported in S&E Indicators include:
- After 16 years of continuous growth during the
late 1970s and throughout the 1980s, industrial
investment in R&D fell in the first half of
the 1990s at about 1.5 percent a year in constant
dollars -- largely due to defense spending cutbacks
by the federal government.
- U.S. industry is spending less on basic research
and relying more on universities and government
laboratories for this work. In the past few years
industry has moved from basic research in central
laboratories and toward applied R&D to confront
increased international competition.
- Academia is the only R&D-performing sector
not to have declined in constant-dollar R&D
spending during the 1990s, thanks mostly to increased
federal investment.
- Japan and Germany invest relatively more of their
economies in non-defense R&D than does the
U.S. Japan invested 2..percent of its Gross Domestic
Product on non- defense R&D in 1993, while
Germany invested 2.4 percent -- considerably exceeding
the U.S. investment of 2.0 percent. However, in
absolute dollars, the U.S. spent much more on
non-defense R&D than did any single country;
in fact, the U.S. nondefense R&D ($106 billion
in 1993) was comparable to the combined total
spent by France, Germany, Japan and the U.K. ($119
billion).
- An increasingly global economy has compelled
U.S. industry to expand overseas. From 1985 to
1993, U.S. firms increased their investment in
R&D abroad three times faster than domestically.
There is little evidence, however, that much of
this overseas investment is meant to displace
domestic R&D; rather, R&D tends to follow
already established overseas production.
- While the overall number of S&E jobs in industry
increased by about 2.5 percent between 1990 and
1993, employment in most S&E occupations declined.
Computer and math-related jobs were the main factors
contributing to the increase in total S&E
employment. These jobs accounted for 28 percent
of industrial S&E employment in 1993, up from
21 percent in 1990.
S&E Indicators also contains data on elementary
and secondary school science and mathematics education,
higher education's role in S&E, and public attitudes
and understanding of science and technology. Required
by law, S&E Indicators is submitted by the National
Science Board to the president of the United States,
who delivers it to Congress.
The Committee on Science and Engineering Indicators,
chaired by Phillip A. Griffiths, oversaw preparation
of the report for the National Science Board.
NOTE: S&E Indicators is accessible on the World
Wide Web at: http://www.nsf.gov/sbe/srs/seind96/start.htm
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under News of Interest. HIGHLIGHTS
from Science & Engineering Indicators 1996
a National Science Board report produced by the National
Science Foundation Science & Engineering Work
Force
- With few exceptions, salaries are higher for science
and engineering (S&E) graduates than for others.
Those S&E degree holders with doctorates earn
23 percent more than those with master's or professional
S&E degrees, and 43 percent more than those with
bachelor's S&E degrees.
- Foreign-born scientists and engineers represent
23 percent of S&E doctorate holders in the U.S.
One-third received their doctorates from foreign
schools.
- Most people with S&E degrees work at jobs at least
somewhat related to their degrees. A majority
(53 percent) with bachelor's degrees in engineering
work as engineers; just 19 percent work in an
unrelated, non-S&E occupation.
Technology Development
- Trade in several advanced technologies, including
aerospace, computer-integrated manufacturing,
life science, and computer software, produced
sizable U.S. trade surpluses in the 1990s yet
the surplus has declined every year since 1991.
- In 1993, the total number of patents granted in
the U.S. rose by less than one percent, echoing
a similar increase in 1992.
R&D Financial Resources & Institutional Linkages
- Of the three major R&D sectors -- industry,
the federal government and academia -- the last
is the only one to have registered a real increase
in R&D investment during the 1990s.
- The most striking trend in industrial R&D in recent
years is the growth of the service sector. In
the early 1980s, nonmanufacturing industries (such
as computer software developers and communications
firms) accounted for less than 5 percent of the
industry total. By 1993 nonmanufacturing firms
represented more than 25 percent of all industrial
R&D in the U.S.
- Unlike the declining trend for manufacturing industries
in the U.S., since 1980 manufacturing consistently
accounted for 95 percent of all R&D performed
by Japanese industry.
Student & Teacher Trends in Science and Mathematics
- In 1993 less than 4 percent of elementary mathematics
and science teachers had majored in these fields.
Only 11 percent of middle school math teachers
and 21 percent of science teachers majored in
their fields of teaching specialization.
- The U.S. remains one of the leading countries
in the world in its creation of a system of higher
education that reaches a broad cross section of
citizens. However, compared with other nations,
a relatively small percentage of U.S. college
students major in natural science and engineering
fields.
- The U.S. educates a considerable number of foreign
students - - but so do other countries. In 1993,
foreign students on temporary visas obtained 44
percent of the math and computer science doctoral
degrees and 50 percent of the engineering doctoral
degrees in the U.S. In that same year, Japan awarded
40 percent of its natural science and engineering
doctoral degrees to foreign students, and one
of three doctoral degrees in all fields of science
in France were awarded to foreign students.
Public Attitudes
- About 40 percent of Americans say they have a
high level of interest in scientific discoveries
and the use of new technologies. This figure has
remained steady through ten years of surveys.
- Only 23 percent of Americans understand the nature
of scientific inquiry well enough to make informed
judgments about the scientific basis of results
reported in the news.
- A majority -- 55 percent -- of Americans use a
computer at home or at work.
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