4.7 million reasons to believe in China

China's factory workers built the growth of the past, but workers with STEM degrees are creating the future.

01 Mar 2018

China leads in STEM education

And China is producing millions of them. 4.7 million in 2016, according to World Economic Forum1 estimates. In comparison, 2.6 million STEM students graduated in India in 2016, while a mere 568,000 did so in the USA.
 

STEM graduates in 2016, countries compared

Source: World Economic Forum, 2016

STEM skills are exactly what chinese companies need

STEM students can manipulate data, build technology, and solve problems. And that’s exactly what Chinese companies need to create innovative products and compete with overseas challengers.

The good news from the Economist Intelligence Unit is that China's STEM talent pool could reach an estimated 48 million by 20302 (37% of the global STEM workforce).

China's STEM labor advantage is playing out in many ways, and here are three of them:

  • China has become an R&D hotspot: With millions of STEM grads looking for work, companies from all over the world invested USD 228 billion in China R&D in 2015 - 4x the 2007 total - and McKinsey estimates they will have committed USD 404 billion by 20203.
     

R&D spending in China (USD billions), 2007-2020 (forecast)

Source: McKinsey (2017)

  • Chinese companies are innovating: More research = more innovations, and the World Bank shows that Chinese companies are innovating like never before, filing 968,252 patent applications in 2015, vs. 288,335 by US companies, and 167,275 by South Korean corporates4.
     

Patent applications compared by country, 1990-2015

Source: World Bank, 2016

  • China has the most powerful computers: Top 5005, which research the world's 500 fastest computers, found 202 in China, with one – the Tianhe-1 (Sky River) – taking top spot with its 2.5 petaflop capacity. That means capacity to calculate millions of sums in an instant.

With such a big, growing talent pool, it's no wonder China's companies are creating more advanced products.

And the change is remarkable, with sophisticated manufacturing goods counting for 59.7% of China's final exports in 2016, compared with 42.7% in 2000, according to the World Input-Output Database6.

And that's why there are 4.7 million reasons to believe in China, because STEM graduates are leading it into the future.

And China's highly-qualified talent base is propelling sectors like healthcare, tech, advanced manufacturing, and internet services that will form the backbone of China's services-and innovation-led 'new economy.'


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