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students and programs had already made substantial adjustments. Because of the lag times between policy action and changes in the system and for reasons enumerated below, we do not think it possible to determine appropriate production targets. A better way to keep supply and demand in balance appears in the next chapter.

The Current Unemployment Situation

The committee is not convinced that the current low and stable unemployment rates among science and engineering PhDs, even new ones, that are documented in Chapter 2 prove that the system is working as well as it should. It is true that science and engineering PhDs have prospered in an increasingly diverse labor market. But as we illustrated in Chapter 2, there are indications of employment difficulties, especially for recent graduates. For example, the percentage of scientists and engineers looking for jobs in the first months after PhD receipt has risen dramatically in some fields, and there is evidence that an increasing percentage of those counted as "employed PhDs" have taken temporary positions in either postdoctoral fellowships or short-term jobs. The unemployment rate as of 1993 (the last year for which there were national data) was still low at 1.6% but was increased from the roughly 1.0% of the 1980s and 1.4% in 1991 (Figure 2-3). Unemployment among new science and engineering PhDs reached 2% in 1993, compared with the roughly 1.5% of the 1980s.

Nor do the available employment data take into account the nature of jobs held by recent PhD recipients. Statistically, a PhD physicist working in a job outside science and engineering is counted equally with a physicist on the staff of AT&T Bell Laboratories or a tenure-track assistant professor at a research university. Moreover, some PhDs who are finding good jobs in nontraditional fields might be doing so regardless of their PhD training, not because of it. The predominant view of the employers that we heard from during the course of our study was that PhD work, including original research, made students more effective employees. However, these graduates might be attractive to some employers simply because they are members of a highly qualified, hard-working, and carefully selected group of people. The time spent in or the content of a PhD program might not be well matched to some science and engineering graduates' jobs.

The committee cannot measure employment difficulties precisely, but the evidence received from witnesses and other contributors is persuasive that problems exist in at least some sectors. Some recent PhDs have indicated that they regretted having spent time and money on doctoral work that turned out not to be useful in their permanent jobs. Some even reported "hiding" their doctorates so as not to appear overqualified, unbusinesslike, or too theoretical in their approach to work.

We believe that the slow but steady shift1 in demand for doctoral scientists and engineers over the last 2 decades away from academe and toward a greater variety of employment has

1 This shift seems dramatic to many observers, but employment data portray slow change over the last 20 years.

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