Immigration & American
Competitiveness
Council on Foreign Relations
November 13, 2007
Michael S. Teitelbaum
Vice President
Alfred P. Sloan Foundation
Immigration is key part
of “shortages” debate
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Claim: U.S. produces too few S&Es
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K-12 failures
Declining S&E interest among US citizens
Typical solutions:
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Restructure K-12 in science/math
Subsidize more domestic S&E majors
More S&E visas [“best and brightest”]
More R&D
Typical report recommendations
Tapping America’s
Potential (2005)
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More/better K-12 teachers
More S&E undergrad/grad
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Rising Above the
Gathering Storm (2006)
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More scholarships & loanforgiveness at all levels
More S&E immigrants
More research funding
More/better K-12 teachers
More S&E scholarships
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+25,000 4-yr undergraduate
+5,000 3-yr graduate
More S&E immigrants
More research funding
Double R&D tax credit
Case Study: Bill Gates on visas
[Senate hearing March 7, 2007]
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“critical shortage of scientific talent”
“…only one way to solve that crisis
today: Open our doors to highly
talented scientists and engineers who
want to live, work, and pay taxes here”
“terrible shortfall in the visa supply for
highly-skilled scientists and engineers”
How many?
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“my basic view is that an infinite number of
people coming, who are taking jobs that pay
over $100,000 a year, they’re going to pay
taxes, we create lots of other jobs around
those people,…the country should welcome
as many of those people as we can get…”
“So, even though it may not be realistic, I
don’t think there should be any limit.”
Bill Gates: U.S. Senate Committee Hearing on Strengthening American
Competitiveness
Thought needed: 2 cautions
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Disaggregate “scientists & engineers”
Disaggregate “high-skill immigration”
Scientists and engineers (S&E)
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Scientists (mostly PhDs)
Engineers (mostly BS, some MS)
IT (most bachelors, many not S&E)
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i.e., large variation within “S&E”
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“High-skill immigration”
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Permanent visas (labor market test)
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“extraordinary”
“outstanding professors/researcher”
“skilled workers”
“professionals with baccalaureate degrees”
Temporary visas (no labor market test)
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“specialty workers” (H-1B)
“intracompany transfers” (L)
Odd focus on supply-only…
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Demand side often ignored – surprising!
S&Es need employment, labs
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Few can hang out shingle…
Degrees require large personal investment
Yet S&E careers falling behind others
Misdirected solutions
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Pumping up supply w/o demand is:
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unwise & wasteful
ultimately ineffectual
Assess first: how attractive are careers?
Assess: do temporary visas and &
offshoring reduce domestic interest?
Needed: honest “systems” perspective
Needed: connect degrees with demand
Labor market: the evidence?
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Slack markets; no general shortage
Remuneration flat, career paths unstable
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Much variation over time, and by field
Data may point more to surpluses…
…even during ‘90s high-tech boom?
(RAND):
rising S&E unemployment that
“while the overall economy is doing well, is a
strong indicator of developing surpluses of
workers, not shortages.”
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Since: IT, telecom, biotech bubbles burst
Yet “shortage” claims continue - why?
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Interest groups making their case
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Employers
Universities
Government funders
Immigration lawyers
Intend no harm; just promoting interests
But politicians, journalists often believe
& Federal agencies often fail to analyze
Shortages sometimes “looming”
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Hard to forecast demand
Many shocks, long lags
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Government S&E budgets: unpredictable
Military procurement: erratic, unpredictable
Private markets: speculative booms & busts
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“Accurate forecasts have not been produced”
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IT, aerospace, biotech, telecom
National Research Council, 2000
& getting even harder (offshore outsourcing)
Case study: Biomedical PhDs
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Natural experiment 1998-present
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much more $, more younger PhDs
But nasty “hard landing” underway
NIH (1998-2003): $13.6 to $27.3 billion
Lower inflation-adjusted, but still large
Goals included:
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Higher grant success rates
More attractive for younger scientists
NIH Budget Authority FY 1977 – FY 2007
(Current vs. Constant 1977 Dollars Using BRDPI as the Inflation Factor)(Dollars in Billions)
$30
$25
$20
$15
$10
$5
2007
2006
2005
2004
2003
2002
2001
2000
Constant Dollars
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
Current Dollars
1989
1988
1987
1986
1985
1984
1983
1982
1981
1980
1979
1978
1977
$0
Number PhDs 35-or-younger increased far
more than those in tenure-track jobs
Number
20,000
15,000
10,000
5,000
0
1993
1995
1997
1999
2001
Year
Age 35 or Younger
In Tenure-track Jobs
Source: Survey of Doctorate Recipients, NSF. The use of NSF data does not imply NSF endorsement of the
research methods or conclusions contained in this report
.
2003
Grant success rates first rose, then declined to
lower than pre-doubling
Number of NIH Competing R01 Equivalent*
Applications, Awards and Percent Funded
(Success Rate)
35%
25%
20
20%
15
15%
10
10%
5
5%
Fiscal Year
Review ed
Aw arded
Success Rate
20
05
20
04
20
03
20
02
20
01
20
00
19
99
19
98
19
97
19
96
0%
19
95
-
Percent Funded
30%
25
(in Thousands)
Number of Applications
30
Success rates down for younger
NIH Competing R01 Equivalent Awardees
14.5%
Percent of Total
14.6%
20.8%
24.9%
15.8%
15.2%
20.3%
23.9%
18.4%
19.0%
6.2%
1995
17.0%
14.6%
20.3%
24.6%
17.1%
17.9%
15.7%
20.5%
23.1%
16.5%
19.6%
16.4%
21.4%
22.4%
21.7%
22.7%
23.9%
24.9%
27.5%
27.6%
16.6%
16.3%
16.0%
17.4%
18.1%
18.2%
21.1%
21.1%
22.2%
20.9%
20.0%
20.1%
19.6%
22.1%
21.4%
21.7%
21.7%
21.7%
15.6%
14.1%
13.8%
13.0%
13.1%
12.9%
12.0%
4.0%
3.8%
4.5%
3.5%
3.8%
3.4%
2000
2001
2002
2003
2004
6.4%
6.4%
6.2%
4.8%
1996
1997
1998
1999
Fis cal Ye ar
35 and Younge r
36 - 40
41 - 45
46 - 50
51 - 55
Ove r 55
2005
PhD system: structural problems
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Positive feedback => unstable equilibria
Magnifies booms, magnifies busts
PhDs & postdocs funded by research $
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More research $ = more PhDs & postdocs
Lag (multi-year)
Then more seeking NIH research $
=> declining grants success rate
Especially difficult for younger scientists
A useful heads-up for NSF
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NSF research budget to double 2008-15
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Depends on Appropriations, of course, but…
Will there be hard landing in 2016?
How minimize risks?
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Reduce feedback of research $ on training
Balance % fellowships vs. research funding
Needed: better “fit” w/ demand
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COMPETES focus: economic competitiveness
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i.e. non-academic science careers
Employers: strong graduate science, PLUS skills:
 basic business
 project management
 interdisciplinary/teamwork
 Communication
Professional Science Masters (PSM)
Status report on PSM degree
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Proof of concept
 ~105 programs, 55+ universities, 25 states
 1300-1500 current students
 ~2000 alumni
 Initial job experiences good
Real progress, but still small and fragile
Goal: “normal” part of graduate education7
So far: little Federal support
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COMPETES Act: PSM authorization for NSF
Plus buoyant NSF basic research budgets
 Less competition than when budgets flat?
Modify structure: less positive feedback
Some useful URL links
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RAND | Issue Papers | Is There a Shortage of
Scientists and Engineers? How Would We Know?
http://www.rand.org/pubs/conf_proceedings/2005/C
F194.pdf
Bill Gates: U.S. Senate Committee Hearing on
Strengthening American Competitiveness
Into the Eye of the Storm: Assessing the Evidence on
Science and Engineering Education, Quality, and
Workforce Demand
Thank you!
Michael S. Teitelbaum
Vice President
Alfred P. Sloan Foundation
teitelbaum@sloan.org