Picking Winners

I had a conversation with a colleague recently after one of our regular Friday night hang-outs.

We were talking about research and work in general (we are after all, both researchers) when the conversation came round to the Economic Development Board's(EDB) investments in research.

My colleague has a friend working in EDB, and she shared some of her conversations with her friend with me. This friend of my colleague shall henceforth be referred to as X.

X works in a department responsible for disbursing seed funding to local companies operating in nascent industries. And X was deeply unhappy in his job (though apparently not unhappy enough to leave, a not uncommon phenomenon).

The reason why X was unhappy was because he had the unenviable task of breaking the unpleasant news that funding was no long forthcoming to these fledgling companies whenever EDB decided to turn off the monetary spigots. Naturally, when funding gets cut, companies die and people get laid off.

Funding can dry up for any number of reasons, some of them very good ones. For example, companies may simply be unviable and should be shut down. Taxpayers' money should not be used to prop up business models that simply don't work (though good luck telling that to the US government that has bailed out the big banks).

While being the bearer of such bad news is always unpleasant, it is far more unpleasant when the decision to cut funding is partially or totally at the behest of trends or fads. In other words, funding can be fickle to the point of being arbitrary, which is somewhat ironic since the whole point of government funding is that it need not be subject to the whims of the market and can take a longer, more strategic view.

Apparently, according to X, the rising trend at EDB is to fund companies engaged in the new sphere of alternative energies and related technologies. This is perfectly understandable given the increased urgency that climate change today is viewed with. In addition, as renowned venture capitalists such as Kleiner Perkins Caufield Byers and Khosla Ventures would say, the energy industry is the biggest industry of them all, and alternative energies will constitute a monumental investment opportunity in the future.

There are other areas that EDB is interested in of course (digital media technologies, water-related technologies). The point here is that as the pie of funding is relatively fixed in nature, more money to these areas means less to others, in particular to the most recent fad of all, life sciences.

Less funding means fewer opportunities, although you wouldn't know it from the horde of students that regularly profess interest in the life sciences today. The recent open house that my company held which invited potential scholarship applicants saw just such a horde. Several students that visited my department's exhibits made a beeline for me with questions to ask once my boss introduced me as a biomedical engineer. The disappointment was palpable when I explained that I no longer worked as one, although strangely enough no one asked why. The students moved on quickly enough when I introduced them to my ex-colleagues working in biomechanics.

The point I am making here is that the capriciousness of government funding and intervention in the industrial marketplace can have real impact on an individual's career decisions, sometimes positive, but quite often negative.

Funding for the life sciences from EDB may be reduced for a number of reasons. I can think of several, but two stand out most. The first is the perception that A*Star already gets plenty of funding for life sciences research and that there is no need for EDB to pick up the slack in the life sciences industry. The second reason is that, rightly or wrongly, it's "mission accomplished" for the life sciences industry; Singapore seems to be successful in attracting pharmaceutical firms and medical device companies to set up shop here, hence there is less of a need to emphasize life sciences. [Sidebar: Though seemingly successful, I am sceptical of the quality of jobs being generated from the investments. Let's face it, people inspired into taking up careers in science and engineering don't exactly aspire to work in manufacturing and quality assurance.]

If there is a lesson to be drawn here, it is that the government in Singapore likes to 'pick winners', hence the title of this post. Like it or not, major segments of our economy are centrally planned. Even the number of doctors, lawyers, teachers and PhDs in Singapore is centrally planned.

For the individual, this works fine if the sector you work in is a 'winner' and the 'picking' part is still in the early stages. You'll do just fine, better than fine even, if you are a foreigner invited to come here.

But if you are late to the cycle, there is a real risk you could get shut out even before you get a foot in the door. Worst, if you are established in the 'winning' field that then becomes less winning, you are left behind, too old to switch fields when you get made redundant.

This Schumpetarian creative destruction may work well for Singapore's economy, but it can leave an exceedingly bitter taste in the mouth of the individual.

We have seen this movie play out several times before. I call it the kiss of life and death: a surge of investment and interest, followed by maturation and then senescence and decline. It happened in engineering years ago. It also happened in Information Technology a decade ago (and IT expertise today has been commodified to a great extent thanks to the influx of Indians and Filipinos, per a friend who works in IT recruitment; salaries and the permanency of jobs have correspondingly slid). It's arguable that it's happening in life sciences today. Even the boom in finance could be argued to be engineered, although I suspect government support for finance will continue as it is seen as too strategic an industry. In contrast, alternative energies, water and digital media are all in the ascendant phase. For now.

What does this mean for life sciences in Singapore? What does this mean for so many that have invested their time and careers in life sciences? I have some predictions I can make, but only time can tell if they are true prognostications.

The first is that life science start-ups, always a dicey proposition, will become even more endangered in the future. We have had no massively successful homegrown biotech company in Singapore. Ever. The odds for this happening are very small. The counterargument here of course, is that the gestational period for biotech startups is long. To that I would reply that the global biotech industry as a whole has never turned a profit. Ever. The successes of Genentech and Amgen cannot redeem the billions of dollars pumped into biotech in the USA, the most dynamic and advanced of economies, with the strongest of research infrastructures. Even if we do see successful startups in Singapore, the ROI would likely be unremarkable.

The second prediction is a narrowing of research foci. There will indeed be happy and successful career life scientists in Singapore. With the amount of money being invested, there cannot be but some success stories. These successful scientists will all be featured incessantly in the local media, working in various happening exciting fields. What you will not hear of are the unhappy scientists and engineers that are forced to switch research fields, say from tissue engineering to stem cells, or from developmental biology to medical diagnostics, because their field of interest is "not relevant". And those are the lucky ones. The unlucky ones will drop out of science altogether.

My advice to would-be life scientists: Make sure you're one of the happy successful ones, working in happy successful fields. If you're not going to be happy, you're going to be miserable. A middle-ground is going to be hard to find.

The third prediction is that the life science industry, like all industries, will mature and stabilize. There will be employment in factories and manufacturing plants, but these will be subject to the global economic cycle just as all industries are. There will be redundancies during recessions, and concerns with China racing up the value chain, and hollowing out during periods of severe competition, just as has happened with semiconductors.

What is least likely to happen is that life sciences will continue along its present path as a golden industry apparently untouchable by calamity, and that is only to be expected.