Innovation at the Heart of Economic Solutions
As the Republican National Convention gets underway in Tampa, we’re going to hear a great deal from the podium about the economy. That’s no surprise, as, for many voters this fall, the choice between President Obama and Governor Romney is a simple equation centered on job creation and economic growth. While no one would disagree with the need to spur growth, how we get there has stirred a spirited discussion. In today's Baltimore Sun, I explain why both the President and Governor Romney should take steps that embrace an innovation economy. From STEM education to tax reform, fostering innovation creates jobs, grows the economy, and ensures that the U.S. is competitive in this 21st century global marketplace.
Tech to the rescue
STEM industries can lead the charge in reviving Maryland's economy
Published in The Baltimore Sun, August 27, 2012
The increasingly hyperbolic diatribes in the presidential campaigns have drowned out any focus on the single most important issue on Maryland voters' minds: jobs. It's time to stop the political attacks and put forward ideas to attack the economy's core problems.
To help, the high-tech sector, at TechElect.org, has developed a "to-do" list that would create the good-paying, long-lasting jobs central to our nation's economic strength. It's based on the record of results that our sector has developed as one of America's economic champions — even with the recession's challenging headwinds.
From 2001 to 2011, more than 742,000 information technology (IT) jobs were created. While U.S. jobs shrank by 4.5 percent, IT jobs grew by 6.8 percent. According to the TechAmerica Foundation's Cyberstates report, 170,000 Maryland high-tech jobs annually contribute $15.3 billion to the state's economy. More than 11,600 local enterprises are putting people to work across the Old Line State, with IT workers earning an average salary of $90,300 — 89 percent higher than the state's average private-sector wage.
This strength can serve as a foundation for job growth in all sectors. But it cannot be the only base for progress.
Long-term economic success starts with education. There is a widening gap between the skills needed for good jobs versus the skills available in the work force. Only 30 percent of U.S. high school students are ready for college-level science, while 45 percent are ready for college-level math. In fact, high schoolers in 17 industrialized nations performed significantly better than U.S. students in math.
America needs a work force second to none. Eighteenth place won't cut it. It is time to refocus curricula on science, technology, engineering, and mathematics (STEM) — skills in great demand yet glaringly short supply.
Additionally, we must encourage more people to earn college degrees — one of the best defenses against economic downturn. A just-released Georgetown University report shows nearly 200,000 jobs for workers with at least a bachelor's degree were added during the recession, and 2 million more jobs for college-educated workers have been added during the recovery. Correspondingly, nearly 4 in 5 jobs destroyed by the recession were held by workers with a high school diploma or less. These facts should serve as a clarion call for students, parents and policymakers alike.
While we invest in American students to be tomorrow's innovators, the U.S. should push to keep foreign-born STEM graduates on our shores. They come here for college because we have the world's best schools. Yet, during the next five years, 100,000 high-skilled immigrants — many with advanced degrees — will be forced to leave the U.S. because of our immigration bureaucracy, taking their innovative ideas and job-creating potential with them. We educate them; we should benefit from their entrepreneurial spirit. Nearly half of all technology startups were founded by immigrants, including companies like Google, Intel, and Qualcomm. We need more, not fewer, of these job engines.
A competitive workforce is part of the solution. We also should strengthen America's competitive environment by adopting a market-based tax system that will help businesses — large and small — to boost wages and increase investments in Maryland and across the country. President Barack Obama and Mitt Romney both have talked about modernizing our outdated tax system. It's no surprise: U.S. business taxes are the highest in the world, and the tax code hasn't experienced any major updates since 1986. Experts say simplifying the corporate tax rate would create an average of 581,000 jobs in each of the next 10 years alone. That's a prescription for economic success.
Finally, both candidates should promote greater access for U.S. businesses to foreign markets, opening doors for "Made in America" around the world. With roughly 95 percent of the world's consumers living outside our borders, American companies need greater access to emerging markets. We can forge ambitious trade pacts with other countries to create new jobs and open new markets to U.S. companies.
We're fighting back from the recession. This year alone, the economy has added more than 1.1 million private-sector jobs. But the recovery's pace has been slower than anyone wants. The steps outlined here would jump-start the economy and help more Americans to find good-paying, long-lasting jobs.
In 1992, Bill Clinton heeded a simple guidepost to win the presidential election — "It's the economy, stupid." Now, 20 years later, as we climb out of the worst recession in generations, the same focus and commitment is required of the candidates this fall.
Dean C. Garfield is president and CEO of the Information Technology Industry Council.