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US Losing R&D Dominance To Asia?

bednarz writes "U.S. companies are locating more of their R&D operations overseas, and Asian countries are rapidly increasing investments in their own science and technology economies, the National Science Board said in a report released this week. The number of overseas researchers employed by U.S. multinationals nearly doubled from 138,000 in 2004 to 267,000 in 2009, for example. On the education front, the U.S. accounts for just 4% of undergraduate engineering degrees awarded globally, compared to China (34%), Japan (5%), and India, Indonesia, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand (17% collectively). 'The low U.S. share of global engineering degrees in recent years is striking; well above half of all such degrees are awarded in Asia,' NSB said in its report."

14 of 461 comments (clear)

  1. asian all the way down.... by schlachter · · Score: 5, Insightful

    And most of that 4% in the US is Asian anyways. Just hope we can keep them here in the US after graduation instead of shipping them back to China because our fucked up immigration policy.

    --
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  2. Duh. by Anonymous Coward · · Score: 5, Insightful

    This is simply the race to the bottom that corporate America is pursuing writ large. When we traded our democracy for a corporatocracy, this was the inevitable result.

  3. But did they LISTEN? by overshoot · · Score: 4, Insightful

    I personally know people in industry who have been warning of this for the last 20 years. The "new economy" of that era promised to reduce costs by moving manufacturing overseas while keeping R&D in the USA. People who knew how R&D worked said that the manufacturing was, if nothing else, necessary to the local support (machinists, PWB fabs, etc.) that support R&D.

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    1. Re:But did they LISTEN? by Anonymous Coward · · Score: 4, Insightful

      This has been happening since the 1970s.

      The problem is that US law as it has evolved in the past two decades is very hostile to a R&D culture:

      1: A nascent product can be sued out of existance. I remember an issue about a helmet company refusing to put out a new safety feature for fear of a bankruptcy producing class-action lawsuit because they didn't do it earlier.

      2: IP laws are so tangled that a company has a minefield of patents that are overly broad or vague. It only takes one violation to have a company shut down and liquidated.

      3: The media shows tech-savvy people as second class citizens. Joe Sixpack is viewed as cooler than Jane Chemist. Engineers are drawn in the press as mentally deranged, toadies, or people from Asia.

      4: Operation Sun Devil scared the [white|grey|black]hat types away from ever working for the US government. Contrast that to China and Russia where this sort of stuff is just as important as physical combat in their armies.

      5: There is such an income difference between being an engineer and other fields. A smart high school graduate can go into CS and might score a job of barely existing. The same guy who parties at a frat, gets his general business undergrad, goes to law school and graduates will be making $100,000 a year starting out, especially if he interns and gets well known at a decent law firm.

      6: Commotization: Why hire people for 40,000 a year in the US when $10,000 can get a contract with 10-20 of the best from Elbonia with guarenteed results?

      7: Tax structure. Payroll taxes are expensive, offshoring gives deductions. Hiring H-1Bs pays more for a company with tax incentives than their salaries cost.

      8: "We can't find any CISSPS to work for us for $15,000/year" translates to "We cannot find any useful talent in the US... we need more H-1Bs!"

      9: It is easy to wind up in jail for vague charges if one shows to be technologically competent. So, people tend to hide this. See #4.

      With the laws and regulations in place that make the US actively hostile to anything but sports heros, rock stars, and actors, it is absolutely no wonder why there is little to no technological progress here.

  4. Sensationalist crap by vinayg18 · · Score: 5, Insightful

    "well above half of all such degrees are awarded in Asia"

    Gee, I wonder if that has anything to do with Asia having well above half of the world's population.

  5. Who needs "intellectuals" anyway? by vell0cet · · Score: 5, Insightful

    Of course this has nothing to do with the anti science movement that took over when W was in office and is still a matter of fact for half the population.

    Half the american public are against "intellectuals", against evolution, deny climate change and think that investing in science is against God or is far to great a burden on the economy and you're surprised at this?

  6. U.S. Companies? by Lije+Baley · · Score: 4, Insightful

    We need a new standard for what a company has to be like to call itself a U.S. company and be eligible for any the benefits of such title. Multinationals with little U.S. corporate responsibility need not apply. If corporations are people, then let them take a citizenship test.

    --
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  7. Re:Then change the preferences to lock Asia out. by PopeRatzo · · Score: 5, Insightful

    No sense in not training our own versus helping the enemy.

    "Enemy"?

    I happen to believe that there is no sense in paying the Chinese to build products that we are going to buy. Especially when we're just supporting the mistreatment of their workers.

    On the other hand, there's every reason to have Chinese and Indians and Iranians and Nigerians, etc come to this country to learn. Because they raise the average.

    My daughter coasted through high school, even though both of her parents are professional academics. She had little ambition and little direction. Her interaction with foreign students who actually place a very high value on their education has had a great effect on her. When she got to college, she saw how hard some people work as opposed to some of the kids she hung around with in high school. She saw students helping each other with study groups, tutoring, even sharing books. It took her a while but now she studies with a group of kids that includes Chinese and Korean and Eastern European students, and in Mathematics, when you hook up with smart people, it's a big help, as opposed to many American students who come in as big swinging dicks and think they've got an A coming as a birthright.

    National borders are artificial. Cultural borders are not. There may not be a reason to see research and development as some grand competition, or the moral equivalent of war, but there is every reason to start spending a lot more money, public money, on R&D. Not because we have to "beat" the Chinese, but because we have to beat a whole lot of problems right here at home, and over-come the increasing anti-intellectualism of many Americans. Of course, I don't think that's going to be an applause line at the South Carolina Republican debate tonight.

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  8. You're putting the cart before the horse by Travoltus · · Score: 4, Insightful

    What is the point of cracking open a science textbook when you are going to be competing with people in Asia who can produce the same level of genius for pennies on the dollar?

    I don't care what you can learn here in America, someone in China can learn the same thing and apply that knowledge for far lower wages than you.

    These people are willing to live in cages. Literally. Look.
    http://www.weirdasianews.com/2009/11/21/hong-kong-citizens-living-cages-literally/

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    1. Re:You're putting the cart before the horse by DigiShaman · · Score: 4, Insightful

      America, EU, and the rest of the "West" is currently caught up in a perfect storm. The problem is a culmination of many things that's leading us into stagflation.

      1. The West is a devloped nation compared to the East's status of developing. They need a high count of engineers at the local level whom can also sell their work and services cheaper to Western nations. So the West doesn't need much in the way of infrastructure and manufacturing construction. When we do, it gets outsourced anyways.

      2. Post WW2 baby boomers are retiring and taking their knowledge to the grave with them. They're also becoming a net drain on society instead of producers. Not that they don't deserve the payback, just stating a logical fact.

      3. Our national debt is rising while wages are dropping. Stagflation will force us into default.

      It will be quite some time spanning a generation or two before global economic equilibrium retains and grows our local industries and pull us out of high employment. It's a waiting game now. The East is now in control of the direction of global human development. Either way, the American culture as I knew it in the 80's and 90's will be radically different from now on. Seeing our zenith come and go in my lifetime is depressing to say the least.

      --
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    2. Re:You're putting the cart before the horse by artor3 · · Score: 4, Insightful

      The only reason that's true is because of our veneration of the Most Holy Lord, Our God, The Dollar.

      Jobs and technology are being shipped overseas. Anyone with a brain can see where this road leads, but the people walking us down that path don't give a shit, because they'll retire and live like kings before we get there.

      Those same robber barons are simultaneously fighting tooth and nail for economic policies that favor the rich. Median wages have stagnated for decades while theirs have quadrupled. If the new wealth had been divided more equitably, median wages would have gone up ~33% since 1980 (that's post inflation).

      And in order for those robber barons to win the fight, they need hordes of easily manipulated people to vote their way. So they make sure that their media puppets and pocket politicians create plenty of wedge issues designed to make Americans despise one another, and that includes the vilification of intellectuals (now a pejorative in the US).

      So you're left with a populace that is poor, anti-intellectual, and so desperate for employment that they'll abandon all the workers' rights that their parents and grandparents won for them.

      The robber barons are a cancer on the nation. They're killing us. They have been for 30 years, and within another 30 the deed will be done.

  9. Re:Degrees are meaningless by rsagris · · Score: 5, Insightful

    Uh, how about you and your company try the novel idea of TRAINING people how to do their job, instead of expecting them to do your job for you by training themselves. If companies would quit expecting their employees to walk in already trained on their specific skill needs and actually get down to taking 1-2 months of training their employees, they might actually solve the problem of not having enough skilled candidates. Use their major and them having a degree as a screening criteria for work-ethic and overall ability to accomplish tasks put to them under a deadline, but don't expect them to be tailor made to suit your field. -rs

  10. Consumers, not Corporations, did it ... by drnb · · Score: 4, Insightful

    This is simply the race to the bottom that corporate America is pursuing writ large. When we traded our democracy for a corporatocracy, this was the inevitable result.

    You are mistaken. It is Consumer America, not Corporate America, that is responsible for the race to the bottom. Corporations do not care where things are made or who makes them. All things being equal they would have things made locally by locals. There are coordination and transportation costs when you move manufacturing or development to some distant place. These additional costs would have to be offset somehow.

    Corporations primarily care about sales, costs are secondary to sales. Cost cutting is only desirable if it (1) generates new sales or (2) preserves existing sales but increases the profit margin. Now consider who controls the sales, it is the consumer.

    Consumers are responsible for the current situation because the consumer preference is for the lowest priced product or service, the consumer does not care where manufacturing or development takes place. **If** consumers did care where manufacturing or engineering took place and **if** this preference was reflected in buying decisions then corporations would not engage in off-shoring since it would hurt sales.

    In other words the U.S. experienced a lot of off-shoring because consumers rewarded those companies that off-shored with sales. **If** consumers had punished those companies but buying domestically manufactured/engineered products from competitors then off-shoring would have been a failed experiment and not have become a major trend. It was all in the hands of the consumer, it still is.

    While much manufacturing has moved off-shore the web has made it easier than ever to find domestically manufactured products. If consumers start showing a preference for such goods then off-shoring can be reversed. The power is in the hands of those making the buying decisions, the consumer, not the corporation.

  11. Re:Change Affirmative Action then by Grishnakh · · Score: 4, Insightful

    A lot of times, if you get a TA or RA assistanceship, your tuition is paid and you get a monthly stipend, in effect paying you to go to school. Yes, you'll have to do research (more likely do grunt work for your prof) or teach undergrad classes (more likely do grunt-work homework grading and study sessions), but it's better than tripling your student loans.

    The downside is that you're stuck in school for 2 more years, making no real money, while you could be going into industry and getting real-world experience while making close to 6 figures. You probably also would be building up more interest on those undergrad loans, though you can usually defer payment. Once you get out, you will get a higher salary generally for an MS degree, but not so much more that it makes it worth it, most likely (this is debatable). But for a PhD, it's much worse; it takes even more time than the MS (compounding those interest and no-pay factors), and you don't get any more salary for it except for a few select disciplines, and in fact it'll disqualify you from a lot of jobs because they'll think you want more money (which you will), and they don't want expensive workers, they want cheap ones. Generally, PhDs in engineering fields (and most others) are only useful if your career goal in life is to become a university professor.