50 percent increase--with a significant amount of the increase attributable to the foreign students I mentioned earlier.

The

Currently, the Soviets have over 900,000 full-time scientists and
engineers engaged in research and development, compared to
600,000 in the U.S. A large percentage of those Soviet
scientists and engineers are believed to be engaged in defense
related R&D the comparable U.S. number is about 150,000.
payoff to the Soviets can be seen in the unbelievable gains they
have made in sophisticated defense systems during the last
decade--in aircraft, in missiles, in space systems, in electronic
systems--all of which refute the notion, held by some, that the
Soviet engineer is inferior to the U.S. engineer.

Japan, with only half the population of the U.S., graduates more engineers each year than we do. We can see examples of the Japanese push towards utilizing high technology for economic advantage on any U.S. highway or in any electronics store.

Given the shortages I have reviewed, it is easy to see that
academia, defense and industry all have problems. But problems
for defense and academia are magnified by competition. That is,
industry can and does outbid us and academia for technically
qualified people. For example, in 1968 the Air Force recruited
over five percent of the college engineering graduates.
Currently, we are able to recruit about one and a half percent,
far short of our goals.

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Industry draws from the same trained engineering pool as the military but with about $7000 higher starting salaries.

In addi

tion, this salary difference is widening as competition among companies for scarce resources increases and industry bids up the price. Industry also couples salaries with excellent peripheral support plans such as additional schooling, family medical/dental plans, complete insurance plans, house purchase plans for transferred employees, excellent move reimbursement programs, and so on. Industry also sponsors scholarship initiatives which attract future engineers right out of high school.

In my view, industry has clearly recognized the national shortfall in scientific and technically educated people, increasing requirements, and the need to provide both immediate and longterm solutions. This recognition has led to corporate redefinitions of the three "Rs" recruit, retrain and retain. Perhaps they should have added another "R"--refurbishment of academic facilities.

Industry, like the Air Force, recognizes that recruiting alone cannot supply the needs of the 1980s, and is, therefore, placing increased emphasis on retraining--continually educating to meet changing demands--and retaining--finding new, more effective ways to keep their scientific and technical people.

Let me shift my discussion of the engineering shortage as a national problem to show with specifics how it affects Air Force

Systems Command (AFSC). To give you an idea of my perspective, AFSC employs 70 percent of the Air Force scentific and engineering officers and currently spends 31 percent of the annual Air Force budget. If measured on a "business volume" basis, AFSC would rank 12th in the Fortune 500's listing of largest corporations.

As the major research and development arm of the Air Force, Air Force Systems Command is charged with advancing aerospace science and technology while developing and acquiring the best aeronautical, space and support systems at the lowest possible cost. In accomplishing these efforts, we administer over 40,000 contracts which have a face value of over $100 billion.

Out of a total Systems Command population of 52,000 military and civilians, approximately 12,000 are technically qualified in the scientific or engineering areas. About 40 percent of this number are military officers--scientists and engineers--who are engaged in every aspect of the aeronautical and space technology acquisition process from concept to deployment.

Simply stated, there is no facet of the Air Force acquisition process which does not depend on the technical competence of scientific and engineering people. At one end of the spectrum, we conduct pure research in the laboratories to provide new ideas or state-of-the-art improvements in the mathematical, physical, engineering, environmental and life sciences. At the other end,

test centers rigorously "check out" and evaluate a weapon system as it is being brought to operational readiness. However, most of my people are employed between these two poles in System Program Offices (SPOs) which are charged with acquiring aircraft, missiles, electronic systems and conventional weapons.

On one hand, the business of AFSC is very much like that of our industrial counterparts. All of the elements are there, particularly the shortage of scientific and engineering personnel. On the other hand, we are unlike them in a critical area--we lack their flexibility to expend whatever resources are required to recruit and retain all the quality personnel we need. This inability is so serious that we--as a command, as an Air Force-may become severely limited in our ability to maintain technological superiority in weapons if we do not confront this problem head on---and solve it.

The proposed increases contained in President Reagan's defense budget will create an immediate demand for even more technically qualified people in programs such as the Long Range Combat Aircraft. Thus, I see my problem about to get even worse. But this is not new, the engineer shortage has been a fact of life for Air Force Systems Command for more than five years.

Since 1976, we have seen our engineering resource base steadily erode to the point that now the Air Force as a whole is nearly 1,100 Military Engineering Officers short of our minimum needs.

And Systems Command, as the primary user of this critical Air
Force resource, is short over 500 military engineers--or

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-0 percent. This shortage is particularly acute in the electrical, astronautical, and aeronautical engineering disciplines which form the nucleus of our engineering force.

Further, the shortages also translate into an experience drain. During the last three years, Systems Command suffered a net loss of nearly 7,500 man-years in military engineering experience. Unlike industry, we cannot hire into middle and top management levels. We must "grow our own"--and to date we simply have not been able to replace this experience.

We face potential experience shortages on the civilian side as well, since about 20 percent of my civilian engineers will be eligible for retirement in the next five years. Our civilian totals, however, are not as bleak-- thanks to a concentrated recruiting effort during the beginning of this year which increased our civilian technical manning level from 93 percent to 98 percent. This does not sound too bad at first blush, but 157 of my civilian engineering positions are still vacant, and with the high retirement rate ahead, the future is uncertain.

Like industry, we have recruited aggressively to fill our military engineer ranks, and in the past two years we have seen some payoff. We now have on board 1,750 new lieutenants in all of our engineering disciplines. In fact, lieutenants now