Institution: Title: ? University of Washington, Seattle, Washington Project Director: Karl H. Vesper, Associate Professor, Department of Management and Amount Requested: $500,000 Duration: 12 months The Brief Description: The basic objective would be to equip and stimulate unemployed people in the Seattle area to initiate new independent business ventures. The program would have three basic ingredients: (1) Investigation of import substitution possibilities, products which are now imported to this area but could be made here. engineers would perform this investigation as part of the program, supported by fellowships to do so. (2) Training of the engineers in the lore and skills of entrepreneurship. A program of special urses would be tailored to their needs for this purpose, drawing on the educational resources which the University has already been developing on this subject. (3) Preparation of feasibility studies, enterprise designs, and financing propectuses by the enrolled participants. Completion of these plans, possibly followed by internship in relevant industries in other parts of the country on a temporary basis would constitute the final step in preparation to initiate the enterprises. The enterprise designs would become public information, so. that they could be exploited by the enrolled participants who developed them, by others, or by both to generate new industries and provide work. A key feature of the program would be that it would aim not simply at training people to fill existing jobs, jobs that would thereby be lost to others in the same area, but to create new jobs for this area which now has the highest unemployment of any major metropolitan area in the country. If successful, the precedent could be expanded to a national basis aimed at increasing net exports of the country. It is estimated that the program would train roughly 50 people, occupy them for one year, produce one overall study of import substitution opportunities plus 10 enterprise designs, and cost about $500,000. Institute: Washington University, St. Louis, Missouri Title: ? Project Director: Bryan R. Noton, Department of Mechanical and Aerospace Engineering, School of Engineering and Applied Science Amount Requested: Duration: ? Brief Description: A concentrated course, of six to eight weeks duration, would be given in the summer of 1971 in St. Louis, Los Angeles, and Seattle for up to 200 unemployed at each site. It would deal with the following major problems confronting the country: (1) Equipping, by retraining, aerospace unemployed for other industrial fields ว (transportation land 1 sea; chemical plants; factory produced housing, etc.). (2) Compressing the extensive time-lag (10 to 25 years) that exists in cost-effectively applying new materials and advanced structural concepts to competitive hardware in various civil systems. (3) Applying conventional materials more efficiently through new design concepts and anufacturing techniques to improve, with (2) above, the life-cycle economics of transportation, housing and other systems. In the past, aerospace engineers quite frequently have been unsuccessful in applying their specialized knowledge to the design of hardware in other industries. One reason for this is that in the design of nonaerospace hardware (e.g. a rapid-transit vehicle) aerospace companies have made efforts to extensively apply expensive aerospace materials to such structures. Attempts were made to justify using these materials on a cost-effective basis by considering not only weight-savings, but also improved fatigue resistance, low crack-propagation rates, low corrosion rates, etc., and they were applied exclusively and not strategically in concert with accepted conventional materials. The true rewards for the industries of this Nation lie in the strategic application of advanced materials (e.g: titanium, graphite fiber and whisker reinforced composites) and by the utilization of aerospace design concepts (e.g. sandwich construction and aerospace manufacturing techniques, diffusion and adhesive bonding) in a more efficient application of conventional materials (e.g. aluminum and steel). The proposed course would comprehensively cover these subjects and, by means of a series of parallel projects (approached as in industry and not academically), the "unemployed" participants would be stimulated to display the utmost of enthusiasm and creativity so necessary in their situation. -2 It is not possible to guarantee employment for the retrained engineers. However, they would prove to be considerably more attractive employees when applying for new positions, and the course would provide them with fresh ideas as to where employment can be sought. Noton also plans to make extensive visits to various industries in order to show them how they might use new materials and to locate potential job openings. "CONVERSION OF SCIENTIFIC AND TECHNICAL RESOURCES FROM DEFENSE-ORIENTED TO CIVILIAN ACTIVITIES" [The following background material is drawn from a report of the George Washington University Program of Policy Studies in Science and Technology, entitled Technological Innovation for Civilian, Social Purposes. The report was submitted in July 1971 to the National Bureau of Standards, Office of Invention and Innovation and to the U.S. Arms Control and Disarmament Agency. The author of the report was Ellis R. Mottur who was then Director of the George Washington University Technological Innovation Policy Project. The judgments and recommendations expressed in the report are those of the author. They do not necessarily reflect the views of other members of the Program of Policy Studies in Science and Technology, or of the National Bureau of Standards, the U.S. Arms Control and Disarmament Agency, or any other organization. The material included in this Record consists, with a few minor editorial changes, of chapters six and seven of the report (pages 412 to 480).] CHAPTER SIX ECONOMIC CONVERSION: CHALLENGE AND OPPORTUNITY A. Need for Conversion The total number of unemployed scientists, engineers, and technicians is large and is becoming larger every day. Unfortunately there are few accurate data available to indicate the national extent of unemployment with any degree of precision. Taking account of the various figures which have been put forth, I estimate that there are currently more than 100,000 unemployed scientists, engineers, and technicians throughout the country.1 By the end of 1971-if effective countervailing measures are not taken—it is estimated that a total of about 200,000 scientists, engineers, and technicians may be unemployed. When one adds to these professional and technical personnel, the thousands of non-technical support personnel who normally work in association with them, and considers as well the many other jobs throughout the economy which are indirectly dependent on these technical personnel, the magnitude of the problem becomes apparent. It has been estimated that for each job in science and engineering there may be as many as ten jobs throughout the economy which are directly or indirectly dependent on it.3 In short, by the end of 1971 many hundreds of thousands of individuals will be unemployed as a direct or indirect result of cutbacks in defense and space research and development. The human hardship resulting from this extensive unemployment is obvious. Equally important, however, is the loss to the nation of the vast treasure of talent which lies idle and unproductive throughout this period of unemployment. The The breakdown between scientists and engineers and technicians is based on a ratio of 7 technicians for each scientist or engineer. This factor was provided by the National Science Foundation as the ratio of technicians to scientists and engineers throughout industry. The more important overall figure of 100,000 is very approximate indeed. Recent estimates by reputable authorities have ranged from a low of 50,000 to 65,000 (U.S. Department of Labor) to a high of 150,000 (IEEE). My estimate of 100,000 is an educated guess based on examination of the wide variety of figures which have recently been put forth. This figure includes: (a) the 100,000 now unemployed; (b) an estimated additional 73,000 scientists, engineers, and technicians likely to become unemployed over the course of 1971 as the second and third order effects of defense and space cutbacks continue to be felt throughout the economy; and 27,000 new science and engineering graduates for whom jobs will not be available. The 27,000 figure is based on an estimate by the President of the American Chemical Society, Melvin Calvin. (See Chemical and Engineering News, Mar. 8, 1971, p. 10.) The overall figure of 200,000 is again a very rough estimate. Using the Administration's current estimates and predictions for the future, one might estimate as low as 100,000. On the other hand a respected manpower authority. Dr. Hugh Folk of the University of Illinois (in his statement as a member of the Panel on National Economic Conversion and Scientific Manpower Utilization at the Midwest Regional Conference on Science, Technology, and State Government on Nov. 19, 1970), estimated 130,000 scientists and engineers unemployed by the end of 1971, which yields a total of 221,000 when one adds in the 91,000 technicians. I think in view of the lack of reliable data on the subject, it is prudent to plan for a total of about 200,000 unemployed by the end of 1971. This estimate was made by Dr. Leonard Lecht of the National Planning Association at An Economic Conversion Conference Task Force Meeting in Washington, D.C., on February 4, 1971. significance of these statistics will be explored in detail in subsequent sections of this report. The important point to stress here is that the highly skilled personnel who have lost their jobs in the defense and space industries must be enabled to find employment in the civilian sector of our economy. Simple human justice demands that the nation create jobs for these highly trained individuals, especially since many of them were enticed into defense or space employment by Government inducements and predictions of prosperous, continuing careers in defense or space R&D. In addition, it is clearly in the national economic interest that these skills be put to work in the civilian sector of the economy where they can serve to generate increased economic activity and jobs. Finally, it is strongly in society's interest that this storehouse of talent be turned toward the resolution of our besetting social problems. To attempt to face those problems without the application of this reservoir of talent would constitute national folly of untold dimensions. In brief, it is clear that conversion is an urgent national necessity. B. Historical background Before considering the economic challenge and social opportunity of conversion in detail, it is instructive to view the conversion problem in its historical perspective. First, it should be noted that the country has successfully carried out previous major conversions: after the Second World War, the Korean conflict, and in making transition between different phases in the development of the nation's defense system. The success of these earlier conversions, however, cannot safely be assumed to apply to the current conversion effort, especially when one focuses only on conversion of scientific and technical resources, as we are doing in this report. It is nonetheless worth examining the earlier conversions for whatever light they may shed on our current problem. Toward the end of World War II many planners were concerned about conversion to a civilian economy and apprehensive about the onset of another major depression. This fear appeared to have some foundation in the fact that defense expenditures amounted to more than thirty-five percent of total national production in 1945. Nevertheless, the country's war effort was dismantled rather rapidly without any significant unemployment resulting therefrom. More than nine million men were discharged from the armed services between June 1945 and June 1946, and national defense expenditures were reduced by seventy-five percent. Between 1946 and 1947 defense expenditures dropped another thirty-nine percent. Notwithstanding the rapidity and extent of this transition from a wartime to a peacetime economy, unemployment in the late 1940's did not exceed four percent of the labor force. This relatively painless transition was largely the result of the enormous consumer demand which had accumulated during the war, in conjunction with the consumer savings which had developed during that period when potential purchases were severely limited. Consequently after the war, market demand for the products of the revived civilian economy was enormous, if not insatiable. During this period, business investment more than doubled; hours of work were reduced significantly; and a great many workers left the labor force to return to school or, in the case of women, to resume full time activities as homemakers.* The transition after the Korean conflict was also accomplished without extensive difficulties since the Korean conflict had never consumed so large a portion of the Gross National Product as had the Second World War. In addition, there were still sizable backlogs of consumer and business demands for durable goods and construction which industry could not meet during the Korean conflict. Also consumer income and spending were sparked by tax reductions. As a result the civilian side of the economy expanded more than the defense sector declined in the period after the Korean conflict. Thus, despite further reductions in defense spending, the economy had fully recovered by 1955. Although unemployment had risen to 5.6 percent in 1954, by 1955 unemployment had declined to 4.4 percent." Transitions within the defense industry since the Korean war have generally been accomplished without extreme difficulties. As The statistics in this paragraph are drawn from the Report of the Committee on the Economic Impact of Defense and Disarmament, Gardner Ackley, Chairman (Washington, D.C.: Government Printing Office, 1965), pp. 8–11. |