What economies want

It can hardly have escaped people's attention that much of the interest around education policy and its relationship to the economy is based on the idea that we need more graduates in Science, Technology, Engineering and Mathematics (aka STEM). It appears to be taken for granted that these folk are the engine of growth. Perhaps because I am a social scientist I am wary of this STEM-fetish. Rather than the thrash the argument about: what is the scientific evidence for this proposition?

The Demand for PhD IT Jobs Advertised Across the UK

IT Jobs Watch provides a perspective on the technology job market in the UK. It is possible to view (employer) demand trends and salary trends related to permanent IT jobs (citing PhD) from the start of 2004. As shown below (and also available here), demand has returned to its mid-2005 level, and is trending upwards.

The first chart provides the 3-month moving total of permanent IT jobs (citing PhD) within the UK as a proportion of the total demand within overall qualifications. The second chart shows the 3-month moving average for salaries quoted in permanent IT jobs citing PhD within the UK.

Should the Government Subsidize Supply or Demand in the Market for Scientists and Engineers?

This NBER paper by Romer (2000) suggests that innovation policy in the United States has erred by subsidizing the private sector demand for scientists and engineers without asking whether the educational system provides that supply response necessary for these subsidies to work. It suggests that the existing institutional arrangements in higher education limit this supply response. To illustrate the path not taken, the paper considers specific programs that could increase the numbers of scientists and engineers available to the private sector.