Commerce Deputy Secretary Rebecca Blank Remarks at Information Technology and Innovation Foundation Conference Thank you, Peter [Coy]. And thanks to ITIF for organizing this. It’s great to be on this panel to lay out some of the key issues for the rest of the day’s discussion.
Innovation is one of the key issues for anyone who is concerned about long-term American competitiveness. That’s certainly true for all of us at the Commerce Department and throughout the administration.
The title of this panel is, “Where is America and Why?” Recently, the Commerce Department tried to answer that very question.
The America COMPETES Act–which passed last year–directed us to compile a report about the competitiveness and innovative capacity of the entire U.S. economy. We released that in January, and we have copies of it here today. We discussed a number of what we called “alarm bells” in that report: The current federal share of research spending is half what it was in the Eisenhower administration.
Today, America ranks 14th in the world in terms of the percentage of college graduates we produce. We used to be number one.
The World Economic Forum now ranks our infrastructure 24th. We used to be in the top 10.
The good news, however, is that none of these trends is inevitable or unchangeable. There are clear policy avenues that we can take to reverse the trendlines on all of these fronts. That’s exactly where the administration has been focused.
I’d like to highlight four areas where the government has a clear role to play in supporting innovation and competitiveness in the private sector. Long-term American competitiveness will require investments in these key areas.
I realize we are facing large government deficits–I’m an economist and strongly believe we need to worry about that. But these are areas where we need to invest to assure long-term future growth, which will only help our long-term budget situation as well.
First, we should invest more federal dollars in basic research.
Basic research and development is an area that is under-provided in the private sector; every major developed country recognizes the need to put public dollars into R&D.
In the U.S., the federal government has played a crucial role in the development of key innovations in the 20th century. The Internet, satellite communications, semi-conductors and other job-generating advances would not have been possible without the wise investment of taxpayer dollars.
Unfortunately, since 1980, federal funding for basic research has dropped from 70 percent of all basic research funding to just 57 percent.
To reverse that trend, the president has set of goal of doubling federal funding for basic research and development by 2016.
In the 2011 and 2012 budgets, and in the proposed 2013 budget, there are substantial increases in funding for NSF, DOEnergy labs, and for the National Institute of Standards and Technology at the Department of Commerce, all of which support important core scientific research.
The fact is, governments around the world are increasing their public support at universities and research institutions. So must we.
Second–and to build on our R&D support–we must support the transfer of new technologies to help increase our productivity, especially in areas such as manufacturing. Production and innovation are inextricably linked.
Manufacturing companies in the United States account for 70 percent of private sector R&D and employ the majority of domestic scientists and engineers. Manufacturing R&D is also the dominant source of innovative technologies that are adopted into the service sector.
The government has played an active role in this space. For instance, for nearly 25 years, the Manufacturing Extension Partnership at NIST has funded centers around the country that consult with private sector companies facing technological problems, and put them in touch with scientists and engineers who can help solve those problems.
The Advanced Manufacturing Partnership–launched last summer–is another important way we are working to advance tech transfer. This public-private partnership uses the convening power of the government to bring together top research universities with manufacturing partners. As anyone who has spent time at a university knows, one cannot simply assume that scientific discoveries will magically find their way into applications.
There is a role for both universities and the government to work together and help make the connections that lead to the transfer of technologies from lab to marketplace.
Third, we must assure that the American workforce has the education and skills needed to support a growing and innovative private sector. A globally competitive economy requires a globally competitive workforce.
Among other things, we need a large and growing group of so-called STEM workers–that is, workers with training in science, technology, engineering or mathematics. These are the workers who will be at the forefront of inventing, applying and producing new technologies throughout the economy.
Over the last decade, growth in STEM job openings climbed three times as fast as other jobs. In recent years, however, only about 13 percent of U.S. college graduates got degrees in the STEM fields. That is much lower than other countries like Korea and Germany, where 25 percent of their students receive STEM degrees.
The president’s 2013 budget invests $3 billion in programs across the federal government that promote STEM education, a three percent increase in funding.
Looking forward, we need to focus on two areas in particular:
Source: U.S. Department of Commerce
