August 2005
How Well Is Washington Competing in the Technology-Based Economy? The Technology Alliance Revisits Our State's Competitive Scorecard in Education, Research and Entrepreneurship
In 2003, the Technology Alliance released its first study benchmarking Washington's performance in the three recognized drivers of successful technology-based economies: excellent education systems, strong research capacity and a robust entrepreneurial climate. We measured Washington against eight peer states with technology-intensive economies - California, Colorado, Georgia, Maryland, Massachusetts, Michigan, Texas and Virginia - and found Washington strong in some areas but lacking in a number of key indicators. This year, the TA reexamined selected metrics and shared the new data at our State of Technology Luncheon. The TA will release its second comprehensive benchmarking report in spring 2006.
"Benchmarking our performance in the three drivers - education, research and entrepreneurship - is critical in order to gauge how well Washington is doing in growing and supporting a thriving technology-based economy," said Chris Rice, TA board member and chair of the Benchmarking Committee. "It allows us to track our progress relative to our competitor states as well as nationally, and shows where we need to concentrate energy and resources to improve our results. Although Washington has begun to make progress since the 2003 study, our state must remain focused on improving its performance in all three drivers to be competitive in the 21st century economy."
The 2003 study found Washington did not rank well against our peers in indicators such as high school graduation rate, bachelor's degrees granted, state support for research and development (R&D), and venture capital investment. In response, the Technology Alliance set out a bold agenda to address those areas in which Washington failed to measure up against our competitors. Among the goals put forward by the TA were increased research capacity with the state as an active partner; removal of structural barriers to technology transfer at our public research universities to foster commercialization; increased access to our institutions of higher education; and, improved K-12 achievement, particularly in math and science.
Washington's performance in the K-12 and higher education metrics in the 2003 study gave us particular cause for alarm, as it was clear that our state needed to do better preparing our students to participate in tomorrow's economy. The 2003 study examined student achievement on nationwide assessment tests to gauge how we measured up against other states in student preparedness. In 2000, the year in which the most current data was available, a mere 26% of Washington's eighth grade students scored "proficient" on the National Assessment of Education Progress (NAEP) in mathematics. This put us in 4th place among our peer states and 10th nationally. Revisiting our performance, we find that Washington increased the percentage of students achieving a proficient score to 32% in 2003 and moved up one place to 3rd among our peers, but slipped in the national rankings to 14th.
The high school graduation rate was another cause for concern. In the first study, the TA found that, in 2000, 68% of Washington's high school freshmen graduated from high school four years later. This put our state 5th among our peers and 32nd nationally. Between 2000 and 2003, Washington increased the percentage of students graduating from high school to 72% - improving our national ranking by one place to 31st - but we fell one place to 6th among our peers.
"Nearly three in ten students entering high school in Washington do not graduate four years later. This is an unacceptable number," said Steve Davis, President & CEO of Corbis and Chair Emeritus of the TA. "We need to continue working to improve K-12 education, and we need to think creatively about how we do it. Out-of-the-box solutions are required to significantly improve our performance. We must find ways to keep kids in school and communicate to both parents and students that a rigorous high school curriculum is the path to a brighter future."
The TA found that Washington also has work to do to increase opportunities for our students in higher education. Only 30% of Washington's high school freshmen had enrolled in college within four years in 2002, down from 32% in 2000. As a result, Washington continues to rank last among its peers and in 46th place nationally in this metric. Washington's rate of bachelor's degree production has also decreased since the last study. From 1998 to 2001, bachelor's degrees granted as a percentage of the 18-24 year old population, which is the most accurate measure for comparing our performance to that of other states, dropped from 4.34% to 4.04%. While we retained our 6th place ranking among our peer states, our position nationally slipped from 32nd to 35th.
"The legislature funded additional capacity at our institutions of higher education in the recent state budget. They took an important step towards changing these numbers," noted Davis. "But we should not kid ourselves. We are still losing ground, especially on an international basis, and need to be diligent in improving opportunities for our young people to succeed in tomorrow's economy."
Washington shows more promise in the area of research capacity. Industry continues to dominate overall R&D spending in our state, increasing its expenditures from $7.2 billion in 1999 to over $8.5 billion in 2002. Washington continues to rank 4th nationally in industry R&D spending and has improved among our peers from 3rd to 2nd place.
Washington historically has not fared so well in state support for research, ranking last behind our peer states and 46th nationally in state support for R&D on a per capita basis in the last study. Since that time, the TA worked with the state and a coalition of business and community leaders on the creation of the Life Sciences Discovery Fund. Once the full impact of the fund is realized, Washington can be expected to dramatically improve its standing in this indicator.
"This new commitment to supporting our research sector represents a giant leap ahead for Washington and will move us from 46th in state support for research into the top quartile," said Susannah Malarkey, Executive Director of the Technology Alliance. "This is a tremendous step forward for our state, and the TA is proud to have played a leadership role in the creation of the Life Sciences Discovery Fund."
Washington also appears to be moving in the right direction when it comes to cultivating a supportive environment for new technologies and young companies. Between 2003 and 2004, the amount of venture capital invested in Washington companies more than doubled, from $400 million to over $860 million, and the total number of deals increased from 78 to 117. Washington moved up from 7th to 6th place among our peers in this indicator.
The recently enacted legislation amending the state ethics law to enable our public universities to more effectively manage the technology transfer process is another positive development that should strengthen our state's entrepreneurial climate.
"Technology transfer enables the discoveries and inventions made within our public universities to become commercial successes," observed Malarkey. "The changes to the state ethics law will result in a more streamlined technology transfer process and encourages important collaborative efforts between faculty and industry."
"In the year ahead, the TA will continue to support efforts to encourage young companies, strengthen math and science programs in our K-12 system, improve graduation rates, and increase the strength and capacity of our entire education system. With concentrated effort, we can improve Washington's metrics and move much closer to becoming a top-performing state in all of the areas that we measure," Davis concluded.
Get Your Monthly Helping of Science & Technology for Breakfast - Register Now for the 2005-06 Season of Our Popular STRT Program!
An exciting new season of the Science & Technology Roundtable (STRT) will commence on Friday, September 9th with a presentation by Clifford Mass, Professor of Atmospheric Sciences at the University of Washington and weather forecasting regular on KUOW 94.9 in Seattle.
The STRT program brings the best and brightest from our research institutions and innovative companies to our members. Since 1997, leaders from business, education and research institutions, and government have convened at STRT to hear presentations on cutting-edge topics in science and technology in an intimate setting.
Read more and register online!
Flying High: Miniature Aircraft Developer The Insitu Group Named 2005 Alliance of Angels Startup of the Year
Last year, the Alliance of Angels initiated its annual Startup of the Year Award recognizing an early stage technology company that exemplifies the spirit of entrepreneurship in the Pacific Northwest. At this year's State of Technology Luncheon, The Insitu Group soared above two other finalists to take home the 2005 honors.
The Insitu Group pioneered the development of long-range, unmanned, miniature aircraft used for reconnaissance, meteorology, and other applications. Its Seascan aircraft is designed for aerial reconnaissance at sea - for example, in coastal patrol or search and rescue - at a fraction of the cost and risk to human crew associated with manned helicopter reconnaissance.
Pitch-er Perfect: The Alliance of Angels Holds Its First-Ever 10 Minute Pitch Clinic for Entrepreneurs
Since 1999, the Alliance of Angels program managers have helped entrepreneurs seeking angel funding to navigate the AoA process and assisted those companies selected during the screening process to prepare for their presentations to the full AoA membership. Along the way, they have amassed considerable knowledge of what resonates with angel investors and pitfalls to avoid when pitching a business plan to AoA members. Now, the program managers are sharing that knowledge with entrepreneurs in an interactive workshop, the AoA 10 Minute Pitch Clinic. Tickets for the first such clinic, which was held on Tuesday, August 2nd in Seattle, sold out.
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