Global Science and Engineering Labor Force Demand

Jeff WheelerBusiness Operations Manager

Corp Real Estate Site DevelopmentNovember 13, 2007

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Agenda

• Growth in hi-tech jobs around the world

• Destination of jobs (by region)

• Top 10 destinations for US-based companies

• US trends in engineering graduates

• Trends in semiconductor capital investment

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Hi-Tech Jobs Created: 2003 – 2006 (click country or region)

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AsiaAsia

Europe/Europe/Middle East/Middle East/

AfricaAfrica

17%17%

73%73%

20032003

AmericasAmericas10%10%

Destination region of job growth: 2003 vs. 2006

Source: IBM-PLI

AsiaAsia

Europe/Europe/Middle East/Middle East/

AfricaAfrica

14%14%

73%73%

20062006

AmericasAmericas13%13%

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Czech Rep

UK

Mexico

Malaysia

Singapore

Germany

Ireland

China

India

USA

0 20,000 40,000 60,000 80,000 100,000

2003

20032003

USA-origin job growth: Top 10 Destination Countries (2003 vs. 2006)

Source: IBM-PLI

20062006

Canada

Ireland

Brazil

Philip.

Malaysia

Ukraine

Singapore

USA

India

China

0 20,000 40,000 60,000 80,000 100,000

2006

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Graduates/Enrollments from USA (EE & CE degrees)

Source: Engineering Workforce Commission

• BS graduates/enrollments declining• MS graduates improving; foreign national declining; enrollments down• US and Foreign Nationals rising; divergence growing; US enrollments improving; foreign-born declining

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Forecast of BS graduates in Electrical & Computer Engineering (EE/CE) in USA

• Relationship exists between salaries and graduates (Computer Eng & Electrical Eng)

• There is a lag between salary and graduates

• Adding add’l information (workforce trends & consumer confidence) to the Salary information, we have a model with a higher correlation:

– Salary only: r = 0.81– Salary + BLS headcount + Jobs Plentiful

(Conf Board): r = 0.95

• This second model provides better fit and better predictions.

Forecast Error:Salary Only: +/- 5,350Full Model: +/- 3,120

Salary TrendFuture graduate trend shows a steady decline in

graduates from 2006 -2009

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World’s Top 20 Semiconductor Capital Spenders

+1 -1 +1 +4 +6 -3 * -2 +11 -1 * * 0 -7 +1 -11 -5 * -2 *

Deltas in position after 2 years shows the intense competition in the semiconductor industry

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Appendix

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Salary for Bachelors Degree graduates(adjusted to 2005 $)

Source: NACE (National Association of Colleges & Employers)• Focus of this research is on Comp Eng & Elec Eng graduates• Dot Com bubble began divergence in wages in mid-’90s • EE and CE salaries have been declining since 2001.

Dot Com bubble

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# Graduates vs Adjusted Salary (lag 4 years)

• Relationship between Graduates & Salary is strongest with 4-year lag in Salary.• Correlation is 0.81 (strong)