The innovation economy
November 15, 2012
Higher education is the foundation for California's success past and present. The issue is whether it will drive the state's future, according to several prominent Californians.

Former Gov. Gray Davis and then-Assembly Speaker Antonio Villaraigosa created research centers at four state universities. Davis used as inspiration the birth of the Silicon Valley. After World War II, Bay Area researchers focused on turning ideas into products, a translational approach that drew a great many electronics companies to the Bay Area.

Moderator Michael Milken said bioscience is the No. 1 driver of economic growth today, and California has a great advantage: It has four of the 12 best research universities in the world. Davis pointed out that the state has more Nobel laureates, more members of the National Academy of Sciences and more research universities than any other state. "They create economies," Davis said, and this concentration of brainpower is the reason so many creative companies are born in California.

Susan Desmond-Hellmann, the chancellor of UC San Francisco and a former leader at the bioscience company Genentech, said this innovative atmosphere makes it far easier to recruit the world's best and brightest students and teachers.

"Great innovators want to be aEUR? near other great innovators," she said.

Education will become even more important a decade or two down the road, Villaraigosa said. Experts predict that by 2025 California will face a shortage of skilled labor, with roughly a million fewer college graduates than the job market will require. To head off the shortfall, the state must educate more of its growing minority groups and recruit skilled talent from other countries. Immigration reform is an economic issue, not a political one, Villaraigosa said.

Peter Ueberroth of the Contrarian Group, who is a trustee at USC, noted that, after Californians, students from China were the second-most populous group at the university in the recent past. Suddenly, Chinese nationals fell to third, after students from British Columbia. Of course, Ueberroth noted, the students from British Columbia were mostly Chinese. They had migrated there after Hong Kong returned to China's control and British Columbia opened its doors to those who wanted to relocate. He suggested the U.S. could learn a lesson from the Canadians about the value of recruiting foreign talent.