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Losing Out to China: The Decline of Superjobs and a New Economic Paradigm?

December 10, 2010

While the secrets and lies unleashed by WikiLeaks have kept me enthralled over the past couple of week, another story with game-changing potential has also broken: China, in its international debut on the educational testing stage, has trounced all other countries in reading, math and science. According to an internationally respected (and rigorously administered) test, students from Shanghai outperformed students from the rest of the world by a substantial margin.

From the PISA press release: “More than one-quarter of Shanghai’s 15-year-olds demonstrated advanced mathematical thinking skills to solve complex problems, compared to an OECD average of just 3%.”

I have cut and paste the results so that you can see for yourselves how Shanghai students dominated in each of the three major categories. While their reading scores were respectably higher than those of South Korea, their test scores in math and science left their next closest competitors (Hong Kong, Finland, Singapore) eating dust. The full table is available here.

For those who are shaking their heads with incredulity, you should know that you are in good company. The officials at the OECD Program for International Student Assessment (PISA) were also taken aback by the results. Apparently, the methodology of the test could not be faulted, and further, “international testing experts have investigated them to vouch for their accuracy, expecting that they would produce astonishment in many Western countries.

This test has always been a big deal, especially amongst developed nations. But this year’s results have been received fretfully by the West because they have underscored a gradual, but undeniable shift in global power and influence eastwards. If China is besting us at the secondary school level today, does that mean that in a few decades we will be working for them? (Remember the rise of Japanese economic power back in the 1980s?)

While it will still be a while (at least 30-40 years?) before China can even hope to overtake the US as the most important and powerful country in the world, recent events have revealed chinks in the American armor— the meltdown of the American financial system and all of the Western economies that were linked to it (except for Canada!), the shift from the G8 to the G20, the audacity of the Chinese in suggesting a move away from using the US dollar as the global reserve currency… and now this.

It’s true that the results were drawn only from Shanghai— a city that attracts the most entrepreneurial and hard-working citizens in the country— so the results are likely to be stronger than that of China as a whole. The students were also told that doing well on the test was important to China’s international prestige, so they were all motivated to do their very best. But these are minor quibbles. The fact of the matter is, they excelled at these tests, not only in the ways that they might have been expected to (“rote” learning), but also in ways that were unexpected (creative problem-solving).

As hinted at earlier, what is genuinely worrying about these results is that Western countries seem to be losing whatever was left of any competitive edge we might have felt secure in. The last of that illusion was just crushed by this study. Let me explain what I mean.

When the manufacturing jobs moved to China in the 1980s and 1990s, I remember the general economic discourse went something like this: Let them have the blue collar jobs. We can create a service economy. Let’s keep all of the “superjobs” (finance, high tech, R&D, entertainment) for ourselves— those that require an educated population. They can have the rest (call centres, low-wage manufacturing). And for a while there, that model seemed to make sense. The textile manufacturers moved to China, and then to Vietnam and Cambodia, and the call centres moved to Mumbai. But the West also got to celebrate as Silicon Valley, Wall Street and Canary Wharf exploded in global importance. The problem was that it soon became clear the West could not monopolize those lucrative service jobs— everyone, including the Chinese, wanted them and wanted them badly. And gradually, we have seen a trickle of these superjobs move eastward.

Still, the superjobs have largely remained tethered to Western economies. As long as there remained a viable model for how Western economies could triumph over Eastern ones, then it was possible for us to ignore all of the other warning signs of our decline. We could still pretend that our “knowledge economy” would continue to dominate over their low-skilled manufacturing economy.

But the PISA results shatter that illusion. They demonstrate that the Chinese are more than capable of beating us at our own game. (The irony of my comment and being Chinese-Canadian has not slipped past me. Suffice it to say that I consider myself on the Western side of this divide.)  If their 15-year-olds are trouncing the West academically, then any hope of us monopolizing information and services in the future seems to be a moot point. That dream of monopoly is now firmly dead. Forget domination, we will be lucky if the West does not decline into oblivion in these sectors.

For example, I was sitting next to an eminent scientist at Exeter’s Christmas dinner and I was told quite matter-of-factly that this decline was inevitable. “Christine,” he said, “I have been watching the British empire decline for as long as I can remember. I have seen it reflected in my own discipline as the number of British scientists giving keynotes at international meetings has fallen. Mostly, it was Americans who took our place. And now, increasingly, we are seeing more and more faces from Asia. I am now in my eighties and let me tell you, there is no fighting it.”

He then went on to remind me that the best advantage that we had is that smart people like to be around other smart people. A reputation for attracting brilliant minds is the best method for actually attracting brilliant minds. It’s true— I have seen that principle at work time and again. He suggested that this was the one thing that would allow a place like Oxford (or any other world-class university in the West) to cling on to any remaining competitive edge we might have over China for just a little while longer. But I know this won’t be enough. And it worries me— because that means there is no clear model for the West’s or Canada’s continued success.

So here is the take home message from this post: We are getting creamed. If we don’t work harder and smarter, we will no longer be competitive. It’s as simple as that.

Update Jan 15 2011: Nicholas Kristof at the NY Times draws broadly the same conclusion as I do in this column.

3 Comments leave one →
  1. January 6, 2011 3:44 am

    Have u seen “shift happens” (ppt)?

    I use it in lectures to make the same point.

  2. January 7, 2011 7:13 am

    Thanks for sharing that with me. I found it interesting, and in fact, I think it does a good job of expressing how I feel about the decline of the West and the impact of technology at this point in time. I think the sound track in my head is less schmaltzy than the one that accompanied the ppt, but aside from that, I enjoyed it.


  3. Anna Z. permalink
    March 31, 2011 7:59 pm

    Hey Christine,
    Great article! Like the Chinese proverb says “May you live in interesting times”…But I would also argue that while the Chinese students are really good at achieving high scores in their tests (and we know that Japanese have been trained from their childhood to focus on university test scores) they may not be as creative. For example, I have recently seen some numbers in the number of scientific journal articles published globally and over 200K /year still come from the US while China produces about 50K per year. Also, from the anecdotal evidence based on conversations with people who attend scientific conferences apparently papers that come out of Chinese universities are not of highest quality and caliber. While the PISA test may have been vigorous, were they able to avoid the bias from locals picking their “best”? On a side note, a prestigious (and very hard to get into) public-private elementary and high school in Paris EABJM has transitioned from teaching Japanese to Chinese for some time. They start teaching Chinese in 3rd grade elementary – this is what adaptation is about 🙂
    Keep sending these blogs!

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