Overall spending on research and development conducted in the United States in 2009 is estimated to have totaled $400.5 billion (current dollars), somewhat below the 2008 level of $403.0 billion, although still well above the $377.0 billion spent in 2007 (table 1). The growth of U.S. R&D from 2007 to 2008 was 6.9%, considerably ahead of the 1.9% expansion of gross domestic product (GDP) during that period (table 2). Although the level of total R&D dropped in 2009 by 0.6%, the depth of the decline was much less than the 2.5% decline in GDP. After adjusting for inflation, the 2009 level declined $6 billion from the 2008 level (down 1.7%) but was still $10 billion higher than in 2007.[2] (Amounts cited throughout this InfoBrief are in current dollars unless stated otherwise.)
TABLE 1. U.S. R&D expenditures, by performing sector and source of funds: 2004–09
Sector and sources
2004
2005
2006
2007
2008
2009
Current dollars (millions)
All performing sectors
302,503
324,993
350,162
376,960
403,040
400,458
Business
208,301
226,159
247,669
269,267
290,681
282,393
Federal government
37,685
39,568
41,611
43,906
44,674
46,151
Federal intramurala
24,898
26,322
28,240
29,859
29,839
30,901
FFRDCs
12,788
13,246
13,371
14,047
14,835
15,250
Industry administeredb
2,485
2,601
3,122
5,165
6,346
6,446
U&C administeredb
7,659
7,817
7,306
5,567
4,766
4,968
Nonprofit administered
2,644
2,828
2,943
3,316
3,724
3,835
Universities and colleges
43,122
45,190
46,955
49,010
51,650
54,382
Other nonprofit organizations
13,394
14,077
13,928
14,777
16,035
17,531
All funding sources
302,503
324,993
350,162
376,960
403,040
400,458
Business
191,266
207,680
227,057
246,679
258,626
247,357
Federal government
91,656
96,276
100,768
105,822
117,611
124,432
Universities and colleges
7,936
8,578
9,285
9,959
10,707
11,436
Nonfederal government
2,883
2,922
3,021
3,265
3,518
3,675
Other nonprofit organizations
8,761
9,538
10,031
11,235
12,578
13,559
Constant 2005 dollars (millions)
All performing sectors
312,548
324,993
339,202
354,864
371,184
364,951
Business
215,218
226,159
239,917
253,484
267,706
257,355
Federal government
38,937
39,568
40,308
41,332
41,143
42,059
Federal intramurala
25,724
26,322
27,356
28,109
27,480
28,161
FFRDCs
13,212
13,246
12,953
13,224
13,663
13,897
Industry administeredb
2,568
2,601
3,024
4,862
5,844
5,875
U&C administeredb
7,913
7,817
7,078
5,241
4,389
4,528
Nonprofit administered
2,732
2,828
2,851
3,121
3,429
3,495
Universities and colleges
44,554
45,190
45,485
46,137
47,568
49,561
Other nonprofit organizations
13,839
14,077
13,492
13,911
14,767
15,977
All funding sources
312,548
324,993
339,202
354,864
371,184
364,951
Business
197,617
207,680
219,950
232,220
238,184
225,425
Federal government
94,700
96,276
97,614
99,619
108,315
113,399
Universities and colleges
8,200
8,578
8,995
9,375
9,861
10,422
Nonfederal government
2,979
2,922
2,926
3,074
3,240
3,349
Other nonprofit organizations
9,052
9,538
9,717
10,576
11,584
12,356
FFRDC = federally funded research and development center; U&C = university and college.
a Includes expenditures of federal intramural R&D and costs associated with administering extramural R&D.
b Los Alamos National Laboratory (approximately $2 billion in annual R&D expenditures in recent years) became industry administered in June 2006; previously, it was U&C administered. Lawrence Livermore National Laboratory (more than $1 billion in annual R&D expenditures in recent years) became industry administered in October 2007; previously it was U&C administered. These shifts in administration category are a main reason for changes apparent in R&D performer figures across 2006, 2007, and 2008.
NOTES: Data are based on annual reports by performers, except for nonprofit sector. Expenditure levels for academic and federal government performers are calendar-year approximations based on fiscal year data. Figures for other nonprofit organizations are estimated and may later be revised.
SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, National Patterns of R&D Resources.
This R&D spending slowdown in 2009 primarily reflects a drop in business R&D (both current and constant dollars) in the face of the financial crisis and economic downturn that started in late 2008. Even so, R&D spending in other performing sectors continued to rise, which offset some of the business R&D decline. Part of this was the effect—notably for federal and academic R&D and R&D infrastructure—of the one-time $18.3 billion funding increase for R&D appropriated by the American Recovery and Reinvestment Act of 2009 (ARRA, Public Law 111-5, enacted February 2009).
The 2009 drop in U.S. R&D is only the second such decline (current dollars) since the early 1950s. Nonetheless, the broader perspective remains that year-to-year increases in national R&D have occurred largely uninterrupted since 1953, in both current and constant dollars (figure 1). Over the 2004–09 period, annual growth in total R&D spending averaged 5.8%, compared with 3.3% for GDP (table 2). Growth in total R&D spending similarly outpaces that of GDP when the averaging period is either 10 years or 20 years. The same relative findings prevail when the dollars are adjusted for inflation.
The U.S. R&D system consists of a variety of performers and sources of funding, including businesses, the federal government, universities and colleges, other (nonfederal) government agencies, and nonprofit organizations.[3] A mix of performing and funding roles exists across this diverse group of organizations. Organizations that perform R&D often receive significant levels of outside funding; those that fund R&D may also be significant performers.
R&D Performers
In 2009, the business sector continued, by far, to be the largest performer of U.S. R&D, conducting $282.4 billion, or 70.5%, of the total (table 1, figure 2, figure 3). This predominance of the business sector in national R&D has long been the case, with its annual share ranging from 69% to 75% over the 20-year period 1989–2009. The 2009 level declined from the 2008 level of $290.7 billion, the first year-to-year decline since 2002. Even so, business R&D performance grew on average at 6.3% annually from 2004 to 2009, outpacing the rates of growth of both U.S. R&D at 5.8% and GDP at 3.3% (table 2).
Universities and colleges performed $54.4 billion, or 13.6%, of U.S. R&D in 2009, an increase of around $3 billion over the 2008 level. Indeed, academic R&D spending has increased (in current and constant dollars) each year over the period 2004–09. The academic sector's share in U.S. R&D has ranged between 11% and 14% over the 20-year period 1989–2009.
The federal government conducted $46.2 billion, or 11.5%, of U.S. R&D in 2009 (including federal intramural, $30.9 billion, and federally funded research and development centers [FFRDCs], $15.3 billion). This was up by well over $1 billion from the $44.7 billion spent in 2008. In 1989, the federal performance share was 16%, but it gradually declined in the years since, ranging marginally above and below 12% since 2004.
Other nonprofit organizations performed $17.5 billion, or 4.4%, of U.S. R&D in 2009.
R&D Funders
With regard to R&D funding, the business sector was again the predominant source in 2009, providing an estimated $247.4 billion, or 61.8%, of the total (table 1, figure 2, figure 3). The federal government accounted for $124.4 billion, or 31.1%, of the funding total. Universities and colleges provided $11.4 billion, or 2.9%; other nonprofit organizations, $13.6 billion, or 3.4%; and nonfederal government agencies, $3.7 billion, or 0.9%. In recent years, these shares have remained relatively stable.
R&D by Character of Work
Basic research activities accounted for $76.0 billion, or 19.0%, of all U.S. R&D expenditures in 2009 (table 3). Applied research was $71.3 billion, or 17.8%; development was $253.2 billion, or 63.2%.
TABLE 3. U.S. R&D expenditures, by performing sector, source of funds, and character of work: 2009
Performing sector and character of work
Source of funds ($millions)
Total expenditures (% distribution)
Total
Business
Federal government
Universities and colleges
Other nonprofit organizations
R&D
400,458
247,357
124,431
15,111
13,559
100.0
Business
282,393
242,820
39,573
**
**
70.5
Federal government
46,150
**
46,150
**
**
11.5
Federal intramural
30,901
**
30,901
**
**
7.7
FFRDCs
15,249
**
15,249
**
**
3.8
Industry administered
6,446
**
6,446
**
**
1.6
U&C administered
4,968
**
4,968
**
**
1.2
Nonprofit administered
3,835
**
3,835
**
**
1.0
Universities and colleges
54,383
3,279
31,575
15,111
4,418
13.6
Other nonprofit organizations
17,532
1,258
7,133
**
9,141
4.4
Percent distribution by source
100.1
61.8
31.1
3.8
3.4
-
Basic research
75,970
16,486
40,451
10,800
8,233
100.1
Business
14,784
13,444
1,340
**
**
19.5
Federal government
11,373
**
11,373
**
**
15.0
Federal intramural
5,507
**
5,507
**
**
7.2
FFRDCs
5,866
**
5,866
**
**
7.7
Industry administered
2,550
**
2,550
**
**
3.4
U&C administered
1,808
**
1,808
**
**
2.4
Nonprofit administered
1,508
**
1,508
**
**
2.0
Universities and colleges
40,544
2,344
24,242
10,800
3,158
53.4
Other nonprofit organizations
9,269
698
3,496
**
5,075
12.2
Percent distribution by source
99.9
21.7
53.2
14.2
10.8
-
Applied research
71,330
34,344
30,101
3,535
3,350
100.1
Business
41,055
33,258
7,797
**
**
57.6
Federal government
12,665
**
12,665
**
**
17.8
Federal intramural
8,006
**
8,006
**
**
11.2
FFRDCs
4,659
**
4,659
**
**
6.5
Industry administered
1,930
**
1,930
**
**
2.7
U&C administered
1,289
**
1,289
**
**
1.8
Nonprofit administered
1,440
**
1,440
**
**
2.0
Universities and colleges
11,912
767
6,577
3,535
1,033
16.7
Other nonprofit organizations
5,698
319
3,062
**
2,317
8.0
Percent distribution by source
100.0
48.1
42.2
5.0
4.7
-
Development
253,161
196,527
53,882
776
1,976
100.0
Business
226,554
196,118
30,436
**
**
89.5
Federal government
22,115
**
22,115
**
**
8.7
Federal intramural
17,389
**
17,389
**
**
6.9
FFRDCs
4,726
**
4,726
**
**
1.9
Industry administered
1,967
**
1,967
**
**
0.8
U&C administered
1,872
**
1,872
**
**
0.7
Nonprofit administered
887
**
887
**
**
0.4
Universities and colleges
1,927
168
756
776
227
0.8
Other nonprofit organizations
2,565
241
575
**
1,749
1.0
Percent distribution by source
100.0
77.6
21.3
0.3
0.8
-
** = small-to-negligible amount, included in other funding sectors.
FFRDC = federally funded research and development center; U&C = university and college.
NOTES: Funding for FFRDC performance is chiefly federal, but any nonfederal support is included in federal figures. State and local government support to business is included in business support for business performance. State and local government support to U&C ($3,675 million) is included in U&C support for U&C performance. Some figures for other nonprofit organizations are estimates and may later be revised.
SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, National Patterns of R&D Resources.
Universities and colleges were the predominant performers (53.4%) of the $76.0 billion of basic research in 2009, with the federal government providing the largest share (53.2%) of the funding (table 3). The business sector performed more than half (57.6%) of the $71.3 billion of applied research and was also the largest funder (48.1%). Business was even more predominant in development, where it both performed the vast majority (89.5%) and provided the largest percentage (77.6%) of the nation's $253.2 billion of development expenditures in 2009.
R&D Intensity
The ratio of total national R&D expenditures to GDP is often reported as a measure of the intensity of a nation's R&D effort and is widely used as an international benchmark for comparing countries' overall R&D systems.
The National Science Foundation (NSF) estimates that U.S. expenditures on R&D totaled 2.87% of GDP in 2009. This figure is somewhat higher than the ratios prevailing in the last several years (figure 4). Over the 10-year period from 1999 to 2009, the ratio has fluctuated to some degree year to year, between a low of 2.55% in 2004 and a high of 2.87% in 2009. The broader trend since the mid-1990s has been toward a rising ratio since a low point of 2.39% in 1994.
The federal and nonfederal components of U.S. R&D performance are plotted in figure 4. It is evident from this chart that most of the rise of the R&D/GDP ratio over the last several decades has come from the increase of nonfederal spending on R&D—particularly, that by the business sector. This reflects the growing role of business R&D in the national R&D system and, in turn, the growing prominence of R&D-derived goods and services in the national and global economies. By contrast, the ratio of federal R&D spending to GDP declined from the mid-1980s to the late 1990s—notably, from the continuing cuts in defense-related R&D. The trend since has been a gradual uptick, the result of increased federal spending on biomedical and national security R&D and the one-time incremental funding for R&D provided by ARRA in 2009.
International Comparisons
Worldwide R&D expenditures totaled an estimated $1.276 trillion in 2009.[4] The corresponding estimate 5 years earlier in 2004 was $873 billion. Ten years earlier, in 1999, it was $641 billion. By these figures, growth in total global R&D has averaged nearly 8% annually over the last 5 years and 7% over the last 10 years.
Many countries conduct R&D; however, global R&D performance is concentrated in a relative handful of countries (table 4). Three countries account for more than half of global R&D. The United States is by far the largest R&D performer ($402 billion in 2009), accounting for about 31% of the global total.[5] China became the second-largest performer ($154 billion) in 2009, accounting for about 12% of the global total. Japan moved down to third, at 11% ($138 billion). The other established performers spend comparatively less: Germany ($83 billion, 6%), France ($48 billion, 4%), and the United Kingdom ($40 billion, 3%). The most recent data available for South Korea are for 2008, which showed the country had $44 billion of R&D—in recent years, South Korea has typically been among the top seven R&D performing countries, representing from 3% to 4% of the global total. Taken together, these top seven countries account for about 71% of the global total. Russia, Italy, Canada, India, Brazil, Taiwan, and Spain make up the next rung, with national R&D expenditures ranging from $20 billion to $33 billion.
TABLE 4. International comparisons of gross domestic expenditures on R&D and R&D share of gross domestic product, by selected country/economy: 2009 (or most recent year)
Region/country/economy
GERD (PPP $millions)
GERD/GDP (%)
Region/country/economy
GERD (PPP $millions)
GERD/GDP (%)
North America
Middle East
United Statesa
401,576.5
2.88
Israel
8,810.1
4.28
Canada
24,551.3
1.92
Turkey
8,681.2
0.85
Mexico (2007)
5,719.6
0.37
Iran (2,008)
6,465.2
0.79
South America
Africa
Brazil (2008)
21,649.4
1.08
South Africa (2,008)
4,689.3
0.93
Argentina (2007)
2,678.8
0.51
Egypt
997.3
0.21
Chile (2004)
1,227.7
0.68
Morocco (2,006)
765.1
0.64
Tunisia
1,048.5
1.21
Europe
Germany
82,730.7
2.78
Central Asia
France
47,953.5
2.21
Russian Federation
33,368.1
1.24
United Kingdom
40,279.5
1.85
Italy
24,752.6
1.27
South Asia
Spain
20,496.4
1.38
India (2,007)
24,439.4
0.76
Sweden
12,494.9
3.62
Pakistan
2,055.2
0.46
Netherlands
12,273.8
1.82
Switzerland (2008)
10,512.7
3.00
East, Southeast Asia
Austria
8,931.3
2.75
Japan
137,908.6
3.33
Belgium
7,684.9
1.96
China
154,147.4
1.70
Finland
7,457.8
3.96
South Korea (2,008)
43,906.4
3.36
Denmark
6,283.8
3.02
Taiwan
21,571.8
2.93
Norway
4,734.1
1.76
Singapore
5,626.5
2.35
Poland
4,874.9
0.68
Malaysia (2,006)
2,090.9
0.64
Portugal
4,411.0
1.66
Thailand (2,007)
1,120.8
0.21
Czech Republic
4,094.8
1.53
Ireland
3,164.6
1.79
Australia, Oceania
Ukraine
2,485.7
0.86
Australia (2,008)
18,755.0
2.21
Hungary
2,333.8
1.15
New Zealand (2,007)
1,422.5
1.17
Romania
1,471.5
0.47
Greece (2007)
1,867.9
0.59
Selected country groups
Belarus
813.3
0.65
EU-27
297,889.6
1.90
Slovenia
1,043.6
1.86
OECD (2,008)
965,629.1
2.33
Croatia
743.1
0.84
G-20 countries
1,181,263.7
2.01
Luxembourg
708.5
1.68
Slovak Republic
595.5
0.48
EU = European Union; G-20 = group of finance ministers and central bank governors from 19 countries plus European Union; GDP = gross domestic product; GERD = gross expenditures (domestic) on R&D; OECD = Organisation for Economic Co-operation and Development; PPP = purchasing power parity.
a Figures for United States in this table may differ slightly from those cited elsewhere in this InfoBrief. Data here reflect international standards for calculating GERD, which vary slightly from National Science Foundation's protocol for tallying U.S. total R&D.
NOTES: Foreign currencies converted to dollars through purchasing power parities. Countries with annual GERD of $500 million or more. Countries are grouped according to regions described by Central Intelligence Agency's World Factbook, https://www.cia.gov/library/ publications/the-world-factbook/index.html#, accessed 13 July 2011. No countries in Central America/Caribbean region had annual GERD of $500 million or more. Data for Israel are civilian R&D only. See sources below for GERD statistics on additional countries.
SOURCES: OECD, Main Science and Technology Indicators (Volume 2011/1); United Nations Educational, Scientific and Cultural Organization (UNESCO), Institute for Statistics, http://stats.uis.unesco.org/unesco/TableViewer/tableView.aspx?ReportId=2655, table 25, accessed 13 July 2011.
With regard to R&D intensity, the U.S. R&D/GDP ratio was just under 2.9% in 2009 (table 4). At this level, the United States is eighth among the economies tracked by the Organisation for Economic Co-operation and Development and the United Nations Educational, Scientific and Cultural Organization. Israel continues to have the highest ratio, at 4.3%, although Finland is not far back, at 4.0%. Sweden, Japan, and South Korea all have ratios well above 3%; Switzerland and Taiwan are slightly above the U.S. figure.
Data Sources and Availability
The statistics on U.S. R&D presented here are derived chiefly from integrating the data on R&D expenditures and funding collected from NSF's major national surveys of the organizations that perform the bulk of U.S. R&D. In some cases, the primary survey data are adjusted to enable consistent integration of the statistics from these separately conducted surveys. Estimated values may be used where final data from one or more of the surveys are not yet available and can reasonably be prepared.
The main R&D surveys utilized include NSF's new Business R&D and Innovation Survey (for 2008 and 2009; see the preceding Survey of Industrial R&D for 2007 and earlier years), the Survey of R&D Expenditures at Universities and Colleges (FY 2009 and earlier years), the Survey of Federal Funds for R&D (FY 2009–11 and earlier years), and the Survey of R&D Expenditures at Federally Funded R&D Centers (FY 2009 and earlier years). Figures for R&D performed by other nonprofit organizations with funding from within the nonprofit sector and business sources are estimated, based on parameters from the Survey of R&D Funding and Performance by Nonprofit Organizations, 1996–97.
Data from the Business R&D and Innovation Survey are reported on a calendar-year basis and are used directly in the integration of the National Patterns totals. Those from the Federal Funds and FFRDC surveys are reported on a federal fiscal-year basis and are adjusted to calendar year for the integration. The data from the Survey of Universities and Colleges are reported on an academic fiscal-year basis and converted to calendar year.
The data on federally funded R&D discussed in this report were derived from surveys of organizations that perform R&D, such as companies, universities, and FFRDCs. These amounts can differ substantially from the R&D that federal agencies have reported funding. In FY 2009, federal agencies reported obligating $133 billion for R&D funding to all R&D performers (including $53 billion to the business sector), compared with an estimated $124 billion in federal funding reported by all performers of R&D ($40 billion by businesses). Although NSF has not found a definitive explanation for this divergence, the National Academies' Committee on National Statistics (CNSTAT) notes that comparing federal outlays (as opposed to obligations) for R&D to performer expenditures results in a smaller discrepancy.[6] For FY 2009, federal agencies reported R&D outlays of $127 billion to all R&D performers.
A full set of detailed statistical tables associated with the National Patterns estimates will be available in the report National Patterns of R&D Resources: 2009 Data Update, accessible at http://www.nsf.gov/statistics/natlpatterns/.
For further information on the National Patterns data and methodology, contact the author.
Notes
[1] Mark Boroush, Research and Development Statistics Program, National Center for Science and Engineering Statistics, National Science Foundation, 4201 Wilson Boulevard, Suite 965, Arlington, VA 22230 (mboroush@nsf.gov; 703-292-8726).
[2] Adjustments for inflation reported in this InfoBrief are based on the GDP implicit price deflator. GDP deflators are calculated on an economy-wide rather than an R&D-specific basis. As such, they should be interpreted as measures of real resources engaged in R&D rather than in other activities, such as consumption or physical investment. They are not a measure of cost changes in performing R&D. The GDP deflators used in this chapter come from the Bureau of Economic Analysis, Survey of Current Business, 29 July 2011.
[3] The National Science Foundation (NSF) identifies the main categories of R&D performers to be the following: businesses, federal agency intramural R&D facilities, federally funded research and development centers (administered by businesses, universities/colleges, or nonprofit organizations), universities and colleges, and other nonprofit organizations. With regard to R&D funding, NSF identifies businesses, the federal government, other nonfederal government agencies, universities and colleges, and other nonprofit organizations as the main sources.
[4] The figures cited here for total global R&D in 1999, 2004, and 2009 are all NSF estimates. R&D expenditures by all countries are denominated in U.S. dollars, based on purchasing power parities. These estimates are based on data from the Organisation for Economic Co-operation and Development (OECD), Main Science and Technology Indicators (Volume 2011/1) and from R&D statistics for additional countries assembled by the United Nations Educational, Scientific and Cultural Organization (UNESCO), Institute for Statistics (as of August 2011). At present, there is no database on R&D spending that is comprehensive and consistent for all nations performing R&D. The OECD and UNESCO databases together provide R&D performance statistics for over 100 countries, although the data are not current for all. NSF's estimate of total global R&D reflects the 78 countries that account for most all of current global R&D.
[5] The $402 billion cited here for U.S. R&D spending in 2009 reflects the OECD statistical conventions for calculating total national R&D (minor differences with the NSF approach) and results in a slightly higher figure than listed earlier in this report. For international comparisons and to ensure consistency, NSF reports the statistics for all countries based on the OECD conventions.
[6] National Research Council. 2005. Measuring Research and Development Expenditures in the U.S. Economy. Panel on Research and Development Statistics at the National Science Foundation; Brown LD, Plewes TJ, Gerstein MA, editors. Committee on National Statistics, Division of Behavioral and Social Sciences and Education. Washington, DC: National Academies Press.
National Science Foundation, National Center for Science and Engineering Statistics U.S. R&D Spending Suffered a Rare Decline in 2009 but Outpaced the Overall Economy
Arlington, VA (NSF 12-310) [March 2012]