The Chinese Academy of Social Sciences (CASS) has released a report on the development of Chinese talent in 2006. The report is based on statistics released by the Ministry of Personnel on Chinese who went to study overseas between 1978 and 2006. The statistics show that more than 70 percent of the 1.06 million students (seven out of every 10 students) who enrolled in an overseas university chose not to return home.

According to the report, China's implementation of the reform and opening-up policy at the end of the 1970s caused a lack of first-class scientists and research pioneers which  is now the main thing hindering China’s innovation capability. To reverse the trend, Beijing is offering bigger incentives for returnees: under new regulations issued in March, senior scientists, engineers and corporate managers are exempted from the household registration system (which determines various state privileges in China), allowed higher salaries and promised places for their children at top universities.

Despite the new regulations, the report warns that the problem may get worse. In 2005, 118,500 students left China to study overseas. By 2010, the forecast is 200,000. Instead, the CASS urged the establishment of a talent security alarm system to monitor the flow of domestic talent.