State Slips on Scale of High-Tech Viability

California, long a leading center of science and technology, is slipping in a number of key areas that threaten the state’s future as a high-tech powerhouse, according to a study to be released today.

The Milken Institute says that though California remains a hotbed of technological activity, its ability to attract academic research and development funds has declined in recent years. California also has lost ground to other states when it comes to hatching new businesses and, most important, educating and training its residents for technical careers.

Milken, in an update of its technology rankings of all 50 states, did find that California edged out Colorado to move to No. 2 behind Massachusetts. But researchers at the Santa Monica think tank said that was only because Colorado took a bigger hit during the recession. California didn’t help its own cause, as its overall score on Milken’s index fell while many other states showed an improvement from 2002.

California’s composite score was pulled down by its marks in “human capital,” a category comprising 18 indicators. The state’s ranking in many of those measures slipped from two years earlier, including the share of residents with a college degree; the percentage of bachelor’s degrees in science and engineering; and the percentage change in state appropriations for higher education. California also lagged behind most other states in its average Scholastic Aptitude Test scores for math and verbal skills. Overall, the state’s ranking in the human-capital category fell to 7th nationwide from 4th in 2002.

“I find that very troubling,” said Ross DeVol, director of regional studies at the Milken Institute. He said that up to now, California “has relied largely on importing human capital from abroad.” But as countries such as India and China continue to build their high-tech economies, fewer foreign students and professionals will have reason to stay in the U.S. “We need to rely more on indigenous capital development,” he said.

The state’s budget troubles will only worsen matters, DeVol said, noting that California already has decided to cut freshman enrollment in the UC and Cal State systems by more than 7,000 this fall.

The Milken Institute said it had not shown its study to outside experts before today’s release, but people were not surprised when told of its basic findings.

“We’ve seen a situation where our educational system has been on the decline for some time,” said Mark Albertson, a senior vice president in the Santa Clara office of the American Electronics Assn. “And in all of the dialogue around these issues” of California’s high-tech future, he said, “that is inescapable.”

Albertson said the state’s tech economy was doubly threatened because of what he called a poor business climate -- something that also surfaced in the Milken study.

The other states in the top 10 were Maryland, Virginia, Washington, New Jersey, Minnesota, Utah and Connecticut.

Among Western states, New Mexico jumped in the rankings, to 14th from 20th two years earlier. Arizona moved up a notch to 17th and Oregon climbed to 19th. Nevada slipped one spot to 43rd.