Press ReleaseNSF PR 96-22 - May 20, 1996This material is available primarily for archival purposes. Telephone numbers or other contact information may be out of date; please see current contact information at media contacts. Major Shifts in World Economy Confront U.S. Status as Industrial Leader, Says New S&E Indicators ReportRecent 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 ** News releases and tipsheets are available electronically on NSFnews. To subscribe, send an e-mail message to [email protected]. In the body of the message, type "subscribe nsfnews" and then type your name. For more guidance, send a "help" message to [email protected]. Also see the NSF Home Page (http:// www.nsf.gov), under News of Interest. HIGHLIGHTS from Science & Engineering Indicators 1996a 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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