But let me underline: this is no minor factual error. The whole piece appears to be built on falsehood. The author is trying to argue that the USA needs more innovation. But why can we produce more manufactured goods than ever with fewer workers? Increased productivity! And why has productivity increased? Innovation!
The article is making the (rather mundane) point that more innovation is a good thing (premise) and that many of the best students are not going into industry but are lured away by academia and a few well compensated fields (law/medicine) and that the country is worse off because of it.
So whether the USA produces much outside of tech isn't that relevant.
So, I stopped reading, but did the OP support this with statistics? Because in my world -- the one in which I myself have gone back and forth a couple of times between academia and industry -- there's plenty of people who try to go into academia, but they don't find work because there aren't enough jobs, and those that exist have low pay, because there's high demand but a rather short supply...
Meanwhile, the thousands of highly-educated people who can't get into academia try to go into industry. Except that many industries aren't hiring much. Perhaps because their productivity keeps increasing and they don't really need armies of new Ph.Ds to keep cranking out widgets at the rate the market demands. I have a lot of friends with Ph.Ds, and not all of them are happily employed. [1]
And that's not even getting into the fact that drawing the line between "academia" and "industry" is increasingly difficult. Every professor has a startup on the side, every major university has a staff of lawyers to manage their intellectual property, and half the grants are industrially funded... or are funded by government grants that are aimed directly at industrially-relevant product development, e.g. drugs. Many industries don't want to do cutting-edge pure research anymore, but instead try to outsource that to academia. In the semiconductor field, a lot of the cutting-edge research gets done in academic labs. E.g. I knew some of the folks who did early OLED research, the product of which now sits inside various Android phones. They were academics, but they are innovating, and their innovations are promptly adopted by industry here and abroad. Similarly, a lot of drugs come out of academic labs and are then pushed through development, testing, and production by industry.
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[1] Though most are, in fact, employed. Don't get me wrong. These days almost any job is a happy job compared to the alternative.
In fact, some of the claims in the article are so ludicrous I can't take them seriously at all. For example:
"... so an entire generation of high-school graduates went to college and learned to loathe industry" and
"so innovation [in the USA] died, and perhaps nine tenths of the brilliant minds that would have otherwise gone into industry and innovated the hell out of their field, that nine tenths went into the legal profession or the medical field or investment banking.".
I just can't take those remarks at face value. I must say though, that the author's claims of disdain for the industry by academia match my experience. The author's complaints about low salaries (relative to law/medicine) in technical fields also match my experience. Where I live (Europe) professors don't have startups on the side, even at the top universities. Different worlds, I suppose.
The article is interesting, and some of his other points about engineering, law, banking, academia, and compensation are interesting; but I wonder if the factual basis for those points is as radically wrong as the basic premise.
The essay from the OP seems to be what you are talking about wrt innovation. The FiveThirtyEight link provided in the immediately parent post to yours doesn't mention innovation.