Monday, March 30, 2009

Economics: Why Would One Go Into Science?

TORONTO, ONTARIO - Recently in various media, Roche's head of global pharma research, Lee E. Babiss, has been quoted as to why the Swiss-based pharmaceutical company has opened an R&D center in China. In the United States and Europe, Babiss has stated, "many kids are not choosing to go into sciences. That is the primary reason we went to China. So many of the young people we were hiring were from China, so we thought 'Why should they have to come to us? Let's go to them instead.'"

Roche happens to be one of the world's large corporations that I actually have reasonable respect for after seeing how they treated their technical employees at their headquarters site in Basel, Switzerland and in Nutley, New Jersey, and how they handled the swallowing of Syntex in California. They're not perfect, but I think they have their priorities better placed than most international corporations with more than 10,000 employees. So, when Roche implies that they are not finding talent in the United States and Europe, I take that statement at face value.

There really should be no surprise about the statement. Most of the most intelligent people I know did not go into science or engineering, or got out of those fields as quickly as possible. In the group of twelve people that graduated in my class of chemical engineers at the undergraduate level, only three of us planned to stay in the field. (If someone else ultimately did, I've lost touch with them and don't know about it.) Of those three, one went into academia and remains in research, one went straight into industry and rapidly transitioned into product management, and I did a graduate degree and went into industry, into a career track like one that Babiss claimed was not often being chosen. Notably, two of the three of us in the group choosing to pursue the field were in the bottom quartile of the class. So, less than one-fifth of the class even tried to make a career out of the field, mostly from the group of weaker students, and only one remains employed--I'm looking for new career.

What did everybody else do? A smattering pursued eclectic dreams like sailing and made a career out of those, but just about everyone in the top two quartiles intended to go to business school or directly into financial fields, and near as I can tell have been very successful in doing so. At the graduate level, the pattern of my colleagues was similar. There was a greater percentage intending to stay in academia that have done so, but again many of the top students simply used their chemical engineering degrees as a way into the financial industry, with a good portion also heading into consulting or other business-related fields successfully. The exact pattern that Roche was seeing, that the best and brightest don't go into technical jobs in industry, was clearly there.

It's not hard to see why. While science and engineering salaries may certainly be higher than the national average, they are way below the compensation packages available to investment bankers, business school graduates or in management. There is little room for advancement in technical positions other than going into management. What's worse, people running the companies view their technical employees strictly as expenses--not as resources, since those in research and development (R&D) technically aren't making anything. When demands come for greater return on investment--whether for corporate survival during a recession or just from investors in boom times--it is easy to justify cutting the expensive R&D employees, and the jobs disappear entirely, or at least get moved to China or India where they can be done less expensively.

Some of the people I know that went into the financial industry or to business school are also out of work in this economy, but they have financial reserves that are five to ten times what mine were when my last job ended and they can live off the interest from their wealth even at current interest rates. Those that went into academia are all employed, if blocked from advancement in the current conditions. They will be okay. Clearly, the people that made the decisions to go into finance, business, or academia made smart decisions.

Meanwhile, those of us that tried to become the R&D workers that Roche claims it can't find in the United States and Europe have been laid off and some of us may never work in the industry again. Is there any wonder that "many kids are not choosing to go into sciences?" Taking a rational view of the job world, why would they?

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