SSTI Digest

U.S. Senators Cory Gardner (R-CO) and Gary Peters (D-MI) sent a letter requesting a 4 percent increase in appropriations for the National Science Foundation and National Institute of Standards and Technology to the Senate Appropriations Committee.

The White House announced an executive order to review the H-1B visa program, and the accompanying language suggests the administration’s interest in reforms to emphasize applicant skills and wages. 

Office of Management and Budget Director Mick Mulvaney lifted the federal hiring freeze last week and asked agencies to plan for workforce reductions.

New legislation in Maryland that takes effect in June provides $1 million in workforce development scholarships and builds on current apprenticeship programs, while also providing tax incentives for new and existing manufacturers to create jobs in areas of the state that need them most. Gov. Larry Hogan signed the More Jobs for Marylanders Act into law last week, a key piece of his jobs initiative. The new legislation establishes scholarships for eligible students enrolled in job training programs at community colleges, and contains measures to encourage high schools to offer additional vocational training, as well as requiring state agencies to analyze their registered apprenticeship programs. This builds on current efforts of Maryland’s Employment Advancement Right Now (EARN) workforce training program, which has already provided training for nearly 2,000 unemployed or underemployed workers.

U.S. companies spent 18 percent of their research and development dollars outside of the United States in 2013, according to data recently released by the NSF. The $73 billion in foreign R&D is concentrated in the information industry, pharmaceuticals, semiconductors, and automobiles and parts. Those four industries accounted for 52 percent of all foreign R&D performance by U.S. companies, while those same industries were less concentrated in the U.S., representing 45 percent of the total domestic R&D performance. The United Kingdom and Germany are the two countries receiving the largest amount of foreign R&D performance by U.S. companies, with Europe as a whole representing nearly half of the total. The Asia and Pacific region accounted for another 31 percent, with India and China being the two largest locations in the region for foreign R&D performance. Data are from the Business R&D and Innovation Survey (BRDIS), cosponsored by the National Center for Science and Engineering Statistics within the National Science Foundation and by the Census Bureau.

Innovation in the energy sector requires strong leadership from the federal government to help mitigate potential risks, according to a recent report by the American Energy Innovation Council (AEIC), a project of the Bipartisan Policy Center. The AEIC is a group of ten private sector leaders that includes Bill Gates, the heads of industry giants like Dominion Energy and Southern Company, and retired leaders of corporations such as Lockheed Martin and DuPont. Unlike many industries, the energy sector has suffered from an underinvestment in R&D, according to AEIC’s The Power of Innovation report. This has led to considerable challenges not seen in other industries. To spur energy innovation in the energy sector, AEIC recommends building on previous efforts to develop a national energy strategy. They recommend investing $16 billion a year in advanced energy innovation, and funding ARPA-E at anywhere from $300 million to $1 billion per year. Additionally, the authors recommend establishing a New Energy Challenge Program for innovative pilot projects.

While the U.S. remains the global leader in overall R&D spending, China has surpassed the U.S. in later stage technological investments, according to a new report by the Boston Consulting Group (BCG). At its current rate of growth, the authors find that China’s investment in later-stage R&D could double that of the U.S. by 2018. Their analysis suggests that there is significant potential for the U.S to get more out of its R&D by strengthening the relationships between industry and research institutions.

U.S. Citizenship and Immigration Services (USCIS) announced on Friday that it had reached the congressionally mandated 65,000 visa H-1B cap for FY 2018, just five days after opening the application process. USCIS will continue to accept and process petitions that are otherwise exempt from the cap. This year, petitioners were unable to apply for premium processing, which has been temporarily suspended. USCIS has also received “a sufficient number” of H-1B petitions to meet the 20,000 visa U.S. advanced degree exemption, also known as the master’s cap.

While the Department of Commerce (DOC) has incorporated several key practices for enhancing and sustaining interagency collaboration around the Manufacturing USA network, the agency needs to develop a better a governance system that outlines the responsibilities and role of non-sponsoring agencies (e.g. Department of Labor, Department of Education) in the network, according to a new report from the U.S. Government Accountability Office (GAO). The report makes recommendations to DOC with the intent of increasing the involvement of non-sponsoring agencies in helping support the 11 innovation institutes that comprise the Manufacturing USA network. The recommendations include:

The federal FY 2018 budget process is well underway, and SSTI members have participated in record numbers to ask Congress to prioritize funding for the Regional Innovation Strategies program. Member organizations, working with SSTI and The Sheridan Group, co-signed 60 appropriations requests to congressional offices and helped to secure 39 signatures on a “Dear Colleague” letter by Reps. David Cicilline (D-RI) and Randy Hultgren (R-IL).

On April 8, New York Gov. Andrew Cuomo announced that the Excelsior Scholarship program will be included in the state’s FY 2018 budget, after having been approved by the legislature. In its first year, the state will commit $163 million to provide tuition-free options for New Yorkers from ‘middle-class’ families at the state’s public institutions of higher education. Under the Excelsior Scholarship program, students can attend any of the colleges or universities that comprise the State University of New York and the City University of New York systems. After completing their degree, the scholarship requires that recipients must work or live in the state after graduation for the same number of years that they receive support.

Traditional economic development efforts at the state level are undergoing increasing scrutiny as budgets are being constrained. Two new studies show a shift in focus away from traditional approaches of tax incentives and reliance on major employers, to broader strategies relying more on the private sector and human capital. A report released by the Delaware Economic Development Working Group recommends shifting many of the core responsibilities of the Delaware Economic Development Office (DEDO) to a new nonprofit. And a report focused on Indiana details the decline in footloose jobs in the state despite local government investments in business attraction, indicating a reevaluation of public policy is needed, the authors contend.

The Ohio Third Frontier Commission (Third Frontier) has announced investments in entrepreneurial service providers (ESP’s) in the Dayton and Toledo regions. A new collaboration focused on health innovation will lead the initiative in Toledo, while an existing entrepreneurial center will lead programming in Dayton. Both regions had been among Ohio’s largest without a dedicated ESP.  The state also awarded funds for its first joint-university program at Cleveland State University and Kent State University, and for commercialization activities at Cincinnati Children’s Hospital.

Much has been written – both here and elsewhere – about the role of trade and automation in declining U.S. manufacturing employment. Recently released preliminary research published by the U.S. Census Bureau’s Center for Economic Studies finds U.S. multinationals were responsible for a disproportionate share of manufacturing employment declines from 1993 to 2011. These results underscore the challenges facing economic development in deindustrializing regions, particularly those reliant on the branch plant economy.