Photonics is Fertile Ground for Job Creation and Economic Growth

The photonics industry and the vertical market segments that employ photonics technologies are fertile ground for job creation, entrepreneurial ventures, investment opportunities, and economic growth worldwide.

Science, Technology, Engineering, & Math Education

Export Reform

Secure Rare Earth Supply

Immigration Reform

R&D Funding

This week, volunteers from SPIE, the International Society for Optics and Photonics, will travel to Washington DC for Congressional Visits Day to educate leaders and express support for funding STEM (Science Technology Engineering Math) education, reforming export and immigration regulations, securing U.S. supplies of rare-earth elements, and funding long term R&D.

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Photonics Industry

The photonics industry and the vertical market segments that the industry enables are in their infancy poised for rapid growth or already on a steep growth curve. The LED industry is where the semiconductor electronics industry was in the mid 1960’s. Laser based research laboratory instrumentation that enabled the mapping of the human genome and ground-breaking discoveries in proteomics is now being deployed at the point-of-the-care to deliver personalized diagnostics and therapies. Optical communications, display and camera technologies continue to fuel smarter phones and tablets.  The list of enabled markets is exhaustive.

STEM Education

Shortage of Workers Skilled in Optics and Photonics

Jobs created by photonics technology businesses are going unfilled today due to a shortage of skilled workers. There exists not only a shortage of workers with advanced degrees, but a shortage of technicians.

According to The National Center for Optics and Photonics Education (OP-TEC), photonics companies report a need to add 1,200 photonics technicians to their workforce every year through 2013 while the 31 colleges offering relevant degress are only producing about 250 graduates per year. Referencing Laser Focus World’s article, How to begin a career in photonics, Indian Hills Community College graduated 19 photonics technicians who received 95 different job offers with salaries from $45,000 to $65,000.

The demand for STEM jobs as a whole is evident. Over the past 10 years, growth in STEM jobs (7.9%) was three times as fast as growth in non-STEM jobs (2.6%).  STEM jobs are also realizing much higher salaries.

Today, in comparison to other countries, the US is not well positioned to exploit these opportunities for economic growth in the photonics industry. Foreign nations expanded their educational capabilities and are surpassing U.S. capabilities. In 1985, China granted about the same number of first engineering degrees as the United States, but granted nearly four times as many in 2005. The average mathematics literacy score of U.S. 15-year-olds in 2009 places the United States below 17 of 33 other members of the Organization for Economic Co-operation and Development.

Model STEM Universities

A Kauffman Foundation study, Entrepreneurial Impact: The Role of MIT, demonstrates the critical role universities play not only in fostering innovation and entrepreneurial growth, but in stimulating the much-needed recovery in regional and global economies. Globally, annual sales from MIT alumni founded businesses are $2 trillion, the equivalent of the 11th-largest economy in the world. MIT alumni companies created an estimated 2,000,000 jobs in Massachusetts and California alone.

SPIE on STEM Education

SPIE believes we must prioritize spending for Science, Technology, Engineering, and Math (STEM) Education programs to develop the scientific and engineering talent base vital to our nation’s economic growth and job creation. They are urging Congress to support the Administration’s FY 2013 (STEM) education budget requests for all agencies, amounting to $3 billion and representing a 2.6% increase over FY 2012 enacted levels.

The STEM Education budget for FY 2013 aims to prepare 100,000 STEM teachers, and add 1 million new STEM graduates over the next ten years. The FY 2013 Administration budget also proposes a new math initiative to bridge the skills gap between high school and college math abilities.

Export Regulation Reform

Barriers to US Technology Leadership

There exist highly restrictive regulation on dual-use technologies.  Inconsistent interpretation and enforcement of regulations have created business, research, and workforce barriers that are limiting leading U.S. photonics companies from shipping abroad.  As a result, government regulations are preventing high technology photonics business from creating jobs and being competitive in the global marketplace.  Referencing the National Science Board, Science and Engineering Indicators 2012 data below, U.S. companies are not creating manufacturing jobs.

Multi-agency Information Triage Unit (ITU) supports timely, consistent decision making on proposed exports requiring a U.S. Government license, more needs to be done. However, a critical component of the Export Control Reform Initiative is moving militarily less significant parts and components from the U.S. Munitions List (USML) to the more flexible Commerce Control List (CCL). This will be a major step in implementing a common sense approach to export controls that will strengthen U.S. national security by allowing the export control system to focus on controlling the most sensitive technologies.

SPIE on Export Reform

SPIE, the International Society for Optics and Photonics supports an overhaul of U.S. export controls to create jobs. Current guidelines are vague, inconsistent and systems managed by the Departments of Defense, State, Commerce and Justice overlap. SPIE supports the Administration’s Export Control Reform Initiative (ECR) – single control list, single primary enforcement agency, single information technology system, and single licensing agency.  SPIE also encourages Congress to direct the Administration to limit export restrictions to components and capabilities that provide a significant national security advantage compared to equivalent foreign products.

Securing Access to Rare Earth Elements

US Produced Rare Earths are Critical to Economic Growth

Dominant uses for rare earth elements in the U.S. are for LED lighting, lasers, auto catalysts, petroleum refining catalysts,glass polishing, color television and flat panel displays (viz. cell phone, smart phones, portable DVD’s and laptops), rechargeable batteries for hybrid and electric vehicles, medical devices, missile guidance systems, space-based satellites and communications, and numerous electrical components.

Supply restrictions and disruptions are raising prices to prohibitive levels or denying access to U.S.based manufacturers. Fifteen of the seventeen rare earth elements impact the optics and photonics industry that supply components used in millions of products and enable much of today’s innovation.

In 2010, a dispute between China and Japan resulted in the cost of Cerium, a rare earth used in phosphors and glass polishing materials that is core to the production of white LEDs, displays and glass optics, increased from $5 per pound to $40 per pound.  As a result, US manufacturers are facing significant losses and revising bids to include a Cerium surcharge for commercial and DoD contracts.

Alternative domestic supplies of rare earths exist today.  Recycling programs and diversity in the domestic production, including financial incentives and regulatory relief are readily available options.

SPIE on Securing US Access to Rare Earths

SPIE supported bipartisan passage of The Rare Earths and Critical Materials Revitalization Act of 2010 (H.R.6160). In addition to the actions outlined in this legislation, SPIE urged Congress to also address issues with current suppliers, institute rare earth recycling programs, and immediately identify alternative supply sources. SPIE endorses H.R. 618 and S.383 and welcomes the inclusion of rare earth-related language in the FY 2012 National Defense Authorization Bill (H.R. 1540) and encourages the Senate to approve.

Immigration Regulation Reform

Welcome New Business Founders and Inventors to the US

Referencing the Kauffman’s America’s Loss is the World’s Gain: America’s New Immigrant Entrepreneurs, immigrants found companies in the US at greater rates than do native born Americans do, and are disproportionately successful in starting high-growth, high-tech firms. Their research shows that immigrants were CEOs or lead technologists in one of every four tech and engineering companies started in the United States from 1995 to 2005 and in 52 percent of Silicon Valley startups. These immigrant-founded companies employed 450,000 workers and generated $52 billion in revenue in 2006. The founders tended to be highly educated in STEM related disciplines, with 75 percent holding a masters or Ph.D. degree.  Kauffman’s research demonstrates that welcoming more job creators can only expand U.S. employment and help renew the innovation engine that drives long-run growth in living standards for all Americans.

SPIE on Immigration Reform

SPIE supports an overhaul of U.S. visa controls to help build a better America.  SPIE supports legislation to award green cards to immigrants who receive a Ph.D. or master’s degree in science, technology, engineering or math subjects from a U.S. university.

Science & Technology R&D Funding

New Technology Companies Create Jobs

The benefits of startups are well-established. Virtually all of the growth in U.S. jobs has been driven by the formation of firms less than five years old and these new firms have been disproportionately responsible for commercializing the cutting-edge innovations that characterize modern life. Referencing the Kauffman Foundation Study, The Importance of Startups in Job Creation and Job Destruction, new firms add an average of 3 million jobs in their first year, while older companies lose 1 million jobs annually.

The environment is ripe for the creation of new businesses founded on the $millions in Research & Development funds spent by the US government, private universities and corporations on photonics and optics technologies. Instead of state and local governments chasing smokestacks, public policy can be crafted to fuel commercialization of these technologies by promoting and fostering the creation and growth of new businesses.

Model R&D Institutes for Technology Commercialization

The University of Rochester’s Institute of Optics provides an important model for commercializing technology whose early R&D efforts were federally funded.  “Of the 33 people for whom I was a Ph.D. advisor over a 30 year period, 13 have started their own businesses,” says Duncan Moore, Vice Provost of Entrepreneurship and former Dean of Engineering and Applied Sciences.  More than 120 graduates of the Institue of Optics have started businesses that are operating today or have been acquired.

SPIE on R&D Funding

While SPIE believes that we must begin to reduce the deficit and begin to live within our means — we must also be smart about doing so. Federal support for R&D will spur our nation’s economic growth. It is imperative that Congress maintain sustainable, predictable R&D budgets. SPIE urges Congress to continue the path for full funding of the America COMPETES Reauthorization Act of 2010 and for key science agencies during FY 2013.

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