FRAMINGHAM (10/22/2003) - In a wide-ranging keynote at Gartner Inc.'s IT Expo Tuesday, Intel Corp. chief executive officer Craig Barrett slammed the state of California's political system as "antibusiness," blamed the K-12 education system in the U.S. for a shortage of computer scientists and warned of a continued migration of IT jobs overseas. He also cautioned the audience of corporate IT professionals that their companies risk falling behind global competitors if they don't ramp up IT spending.
Barrett said the current political crisis in California is the result of years of antibusiness legislation, adding that the Santa Clara, California-based chip maker has more U.S. employees outside California than it does in the state.
"We are diversifying out of California," he said. When asked about future investments in California, Barrett replied, "It's very simple," emphatically shaking his head no. "There's not much incentive at this time." While Barrett said he doesn't expect Governor-elect Arnold Schwarzenegger to repeat those policies, he didn't say whether the change in leadership would affect Intel's view of the California business climate.
Barrett's assessment of public education was equally blunt.
"The K-12 system in the U.S. does an excellent job of weeding out anyone who's interested in science," he said to scattered applause. Barrett also criticized public education's seniority-based system. "Meritocracy should rule, not seniority," he said.
He also dismissed the idea that bringing more technology into schools will solve the problem. "If technology was a solution to the education problem, we'd [already] be far ahead," he said. The end result of the current educational system is a shortage of U.S. talent and a situation where 50 percent of all advanced degrees are awarded to foreign nationals.
U.S.-funded colleges pay to educate them, he said, "and then we send them home and the jobs follow them." To reverse the brain drain, Barrett said the U.S. should "staple a green card to every diploma. [That] would do wonders for the U.S economy."
While he said the ratio of domestic Intel employees has remained constant at 60 percent during the past decade, increasing competition from U.S.-trained IT professionals in Russia, China and India and the "dwindling number of IT graduates in the U.S." could change that.
"There is huge competition coming for jobs," he said, noting that those three countries could produce between 250 million and 500 million knowledge workers.
Barrett said that while European and Asian companies continue to spend on IT, "the U.S. enterprise market is the weakest we see today." While Intel has seen "a bit of strength" in the market after two and a half years of flat sales, U.S. global competitiveness will suffer if enterprises wait much longer, Barrett said.
"The U.S. is still the most powerful economy in the world," he told the audience. "If you want to maintain that, you have to continue to invest. The world is the economic play space going forward."