As I was reading one of the Idaho Statesman’s recent articles about Micron’s latest round of layoffs, I was struck by the reaction of one of our legislators. This particular gentleman was quoted as saying “It’s a shock. I’ve been through three or four of these. You think you see things that show we’re hitting the bottom. Then two days later, the bottom falls out again.” I’ve never met this legislator and my intent is not to single him out. I’m sure that he, like most of us are devastated for the thousands families affected by these layoffs and I’ve got a tremendous amount of respect for anyone who devotes a significant portion of their life to public service. However, I know hundreds of people working in the tech sector in Idaho and I promise you, not one of them would say they are “shocked” by this news. Saddened like you and I, yes. Shocked? No way. People in Idaho’s tech sector have been expecting and talking about this day for years.
If anyone is shocked by this news than they fail to grasp that Micron stopped being an innovative technology company a long time ago. What they became is an innovative manufacturing company. Micron is laying off 2000 more workers for the same reason that you no longer have a neighborhood drug store, hardware store, or corner market and now buy the products they sold from Rite-Aid, Home Depot and Wallmart. Micron is a manufacturer of commodity products like toothpaste, screwdrivers and blue jeans. The winners are the ones who can produce and sell it the cheapest. Given that, why in the world would Micron hire an engineer in Boise, ID for $70,000 a year when he can hire that same engineer in China for $7,000? Whatever you do, don’t fool yourself into thinking our US engineers are better trained, it’s not true. China is building top-notch engineering schools at a breakneck pace. Personally, I think it’s remarkable that Micron thrived as long as they did while continuing to manufacture in the US and Steve Appleton probably doesn’t get the credit he deserves for their long run at the top.
If Idaho’s lawmakers want to return to (and stay in) the heyday of higher paying technology jobs, I believe that the best way to get there is through significant investment in math & sciences, from K-12 up through PhD programs at our universities. In fact, this week Forbes published a compelling article on the importance of Universities (particularly their engineering schools) in the innovation continuum. Recruiting more tech companies is a band-aid, not a cure. When a forest burns down, you don’t plant mature trees to replace it. While there might be exceptions (I don’t know of any), every town where multiple technology companies have been started and flourished, there have been world-class universities or corporate R&D labs to fuel innovation and create an educated tech workforce. There are no shortcuts. Long before venture capitalists arrived and funded technology and biotech companies in Silicon Valley, Boston and Research Triangle Park (known as three of the hubs of innovation in our country), the research labs at MIT, Stanford and Duke/North Carolina were the benefactors of huge capital investments to fund world-class research and development. You don’t even have to look to those larger cities to see how this type of investment has reaped great rewards. I spend a great deal of time in Utah where they’ve been investing millions of dollars a year into R&D in their universities for many years. Last year, the University of Utah alone spun out 17 high tech companies, 2nd in the nation!
What can we do? In 2006 Utah founded USTAR, an initiative intended to foster research at state universities and promote the creation of new companies to commercialize that research. USTAR was launched with a one-time investment of $3.35 million and ongoing funding of $4 million annually. University of Utah and the other Utah schools have been the beneficiary of the investment Utah has made in its future. The challenge for our lawmakers who care such a great deal about Idaho is that it will take a great deal of courage to make these investments in our future when they might not be in office when the payoff comes. There will be no immediate payback, no progress to show when it’s time to campaign again in a couple of years.
Given the current enviornment, I’m sure many would say “How will we pay for this?” The only answer I have is that we can’t afford not to. Perhaps we should go back and see how the land grant system was funded (which gave us The University of Idaho). Or how the GI bill was funded. The short answer is it was funded with capital. It was an investment made in the future with no short-term payback expected. Generations have long lived off the dividends being realized from these original investments. It is, however, our turn now to invest in the future. While this might sound daunting, it is definitely attainable and we have some great assets to work with. For example, I’m confident that we can create a world-class Center of Excellence here in Idaho in materials science that will result in great tech startups over time. BSU’s Engineering School has a burgeoning materials science program and many of the engineers at Micron have core competencies in this area. Furthermore, materials science expertise lends itself to Clean Tech innovation, an area that will certainly be around for a while. I’d be pleased to sit down with any of our lawmakers to talk in more detail about how we can invest a small amount today for tremendous rewards down the road.