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Release: Immediate

UI's Skorton serves as advisor for national study on U.S. innovation

IOWA CITY, Iowa -- Although the United States continues to be the undisputed world leader in business innovation, this is no time for the country to rest on its laurels.

That's the message of Going Global: The New Shape of American Innovation, a report recently issued by the Council on Competitiveness, a nonpartisan group of 150 corporate, academic and labor leaders. The report was based on the work of an advisory committee composed of research and development heads at 120 companies, universities and national laboratories.

Debra van Opstal, Council vice president, said that the report has been issued at a crucial time in U.S. history.

"The emerging environment for innovation is likely to be unforgiving. Neither the United States' capability for world-class science and technology nor its ability to lead international markets is insulated from global competition. If we inadvertently allow key parts of our innovation enterprise to erode, the growing numbers of innovative competitors globally will not be slow to fill the breach. Once lost, leadership will not be readily or inexpensively recaptured, if it can be recaptured at all," she said.

David J. Skorton, UI vice president for research and member of the study's advisory committee, noted that the study is aimed at keeping business leaders and the public alert to trends in U.S. innovation before serious problems develop that might harm the nation's long-term economic health. "The American system of innovation is based on a very successful partnership among academia, private industry and the government. This partnership requires constant vigilance and support to ensure a continued flow of new knowledge into useful innovation," he said.

The report outlines conditions necessary to achieve innovation payoff -- economic growth and higher-wage jobs -- and reviews the innovation capacity of five key industry sectors:
* Health -- The United States is the global leader, but its position is based largely on previous investment, and there are concerns about the future of innovation and continued public support for biomedical research.
* Advanced Materials -- It is possible that U.S. companies will fail to reach their potential because of insufficient support for the physical sciences and engineering, lack of capital for small start-ups, and non-competitive tax credits.
* Autos -- The lack of domestic demand for advanced technology vehicles -- linked to the low price of gasoline in the United States -- is one of the most serious barriers to investment in innovation here. Although the U.S. has historically been the dominant location for R&D, a growing percentage of new R&D investments by U.S. companies are migrating offshore. Offshore demand and new national competitors will continue to drive global investment.
* Express Package Transport -- Value-chain management companies focus principally on integrated system design, performing very little research and development. The principal concerns for the future are the availability of networking computer science professionals and a lack of network-based university curricula.

For the purposes of the report, the Council on Competitiveness defined "competitiveness" as the nation's capacity to produce goods and services that succeed in international markets while maintaining or boosting the real incomes of U.S. citizens. Copies of the report ($40 plus shipping and handling) can be obtained by contacting the Council at 202-682-4292 or www.compete.org.

11/4/98