There is no engineering gap

Last year there was a lot of hysteria among the business press over the fact that China and India were allegedly graduating hundreds of thousands of engineers a year, while the U.S. could only muster around 70,000 or so. I blogged last October about how even outsourcing critics were skeptical of these numbers. Now, courtesy of Duke University's Engineering Management Program, there are some harder numbers on this subject -- and it turns out there's not much reason to panic (link via the Wall Street Journal's Carl Bialik). Here's the report abstract: The effect of the dynamics of engineering outsourcing on the global economy is a discussion of keen interest in both business and public circles. Varying, inconsistent reporting of problematic engineering graduation data has been used to fuel fears that America is losing its technological edge. Typical articles have stated that in 2004 the United States graduated roughly 70,000 undergraduate engineers, while China graduated 600,000 and India 350,000. Our study has determined that these are inappropriate comparisons. These massive numbers of Indian and Chinese engineering graduates include not only four-year degrees, but also three-year training programs and diploma holders. These numbers have been compared against the annual production of accredited four-year engineering degrees in the United States. In addition to the lack of nuanced analysis around the type of graduates (transactional or dynamic) and quality of degrees being awarded, these articles also tend not to ground the numbers in the larger demographics of each country. A comparison of like-to-like data suggests that the U.S. produces a highly significant number of engineers, computer scientists and information technology specialists, and remains competitive in global markets. And this is from the text of the report itself: The outsourcing debate has been complicated due to conflicting definitions of the engineering profession.... Through our research, we have identified two main groups of engineering graduates: dynamic engineers and transactional engineers. Dynamic engineers are individuals capable of abstract thinking and high-level problem solving using scientific knowledge. These engineers thrive in teams, work well across international borders, have strong interpersonal skills, and are capable of translating technical engineering jargon into common diction. Dynamic engineers lead innovation. The majority of dynamic engineers have a minimum of a four year engineering degree from nationally accredited or highly regarded institutions. Transactional engineers may possess engineering fundamentals, but not the experience or expertise to apply this knowledge to larger problems. These individuals are typically responsible for rote and repetitive tasks in the workforce. Transactional engineers often receive associate, technician or diploma awards rather than a bachelor?s degree.... Graph 2 depicts the annual production of bachelor?s and subbaccalaureate degrees in Engineering, CS and IT awarded per million citizens. These data imply that per every one million citizens, the United States is producing roughly 750 technology specialists, compared with 500 in China and 200 in India.... Outsourcing creates a clear threat to certain professions and it is likely that this trend will continue. It seems that the jobs of transactional engineers are easily outsourced and are routinely being taken by relatively low paid engineers in countries like India and China. However, the outsourcing of high-level engineering and IT professions is another story. These jobs often require specialized dynamic engineers: individuals with strong interpersonal skills, technical knowledge and the ability to communicate across borders.... The great majority of engineers involved in outsourced professions hold a minimum of a four-year degree. As a result, one could argue that approximately half of China?s and India?s annual engineering and IT graduates are capable of competing in the global outsourcing environment. However, a recent McKinsey global labor market study argues that this estimate is far too generous. McKinsey concluded that only 10% of Chinese engineers and 25% of Indian engineers can compete in the global outsourcing arena. So, to conclude, offshore outsourcing will take place when the tasks can be segmented into discrete, simple and rote tasks, and does not pose a threat to engineers at the B.S. level or above. Damn, that sounds familiar.