Useful Stats

Across the U.S., the federal government provided 53 percent of R&D funding at institutions of higher education in FY 2018. Those institutions provided 26 percent of the funding themselves, and most of the remainder was provided by a mix of nonprofit organizations (7 percent), industry (6 percent), and state and local government (5 percent). The specific contributions varied from state to state, however, with some relying more on specific relationships to support R&D within the state.

As covered recently by SSTI, NSF’s National Center for Science and Engineering Statistics provides survey data on R&D funding at institutions of higher education. NSF’s report includes source of funding, attributable to federal government, state and local government, institutions, business, nonprofit organizations, or other sources.

Expenditures in higher education R&D (HERD) grew in FY 2018, increasing by $4.1 billion over FY 2017, the largest year-over-year increase since FY 2010-2011 according to an SSTI analysis of recently released data from the National Science Foundation’s National Center for Science and Engineering Statistics. For the 10-year period from FY 2009 to FY 2018, HERD grew by 38.4 percent nationally, representing an increase of nearly $22 billion. Higher education R&D expenditures grew the fastest over this 10-year period in the District of Columbia (78.2 percent), Connecticut (65.5 percent), Washington (59.5 percent), and Utah (59.3 percent). The largest absolute gains over the same period were seen in California ($2.5 billion increase), New York ($2.3 billion), and Pennsylvania ($1.6 billion). The map below shows the one-, five- and 10-year percentage changes in each state’s higher education R&D expenditures.

From 2006 to 2018, income inequality has risen continuously both nationwide and in all states (but not in the District of Columbia). Annual changes vary widely for state income inequality, with some states experiencing increases year after year, and others displaying more volatile trends consisting of both sharp annual decreases and increases. This edition of SSTI’s Useful Stats examines trends in the Gini index —a measure of household income inequality that increases as the distribution of income becomes more concentrated within a smaller share of the population — at the state level from 2006 to 2018.

While rankings and annual indices are catnip for some looking to gain attention for their latest rankings, SSTI has always argued that it’s long-term trends that give the best sense of where a state or region stands. With recent release of income data, SSTI has examined the last 34 years data in median household income for each state. SSTI found that while median household income — adjusted to 2018 dollars — has risen in nearly every state and the U.S. since 1984 with an average annual rate of increase of 0.8 percent, the growth, not surprisingly, varies widely among individual states. For example, the District of Columbia experienced an 82 percent rise in median income over this 34-year period, with an average increase of just over 2 percent each year, while Alaska (although still ranked among the states with the highest median household income) experienced a reduction of nearly 8 percent over the same period.

Business R&D activity has been historically concentrated in a few states and became even more so in 2017, according to a National Science Foundation issue brief on the latest Business Research & Development and Innovation Survey (BRDIS). Despite finding total business R&D surpassed $400 billion in 2017, reflecting a 6.8 percent increase over 2016 results, NSF’s data also reveals R&D activity in five states alone – California, Massachusetts, Michigan, Washington and Texas – captured well over half of all of the nation’s business R&D investment in 2017. These top states represented 55.2 percent of the total in 2017, while five years earlier their share was “only” 49.4 percent of the reported results.

For years, there have been arguments back and forth on which companies are the greatest job creators. The argument began with advocates for small businesses saying that small businesses were the engine of job creation. In recent years, others have argued that it’s not the size of the business that’s significant so much as the age of the business and that it’s young businesses that create most of the jobs.

Analysis by SSTI of Census Bureau’s Business Employment Dynamics (BDM) data finds a more nuanced picture when examining states’ shares of net job creation by firm age.

In the maps below, green indicates high net job creation, with darker shades indicating stronger levels. Yellow and orange indicate low and near-zero net job creation, with orange indicating lower rates than yellow. Red indicates zero job creation and job losses. Black dots indicate each state’s share of total nationwide job creation.

Home to the Research Triangle Park and top-tier research universities like Duke University and the University of North Carolina at Chapel Hill, the Durham-Chapel Hill metropolitan area led all regions in per capita NIH funding in FY 2018 and placed sixth in total funding that year, according to a new analysis by SSTI. This edition of Useful Stats looks at all NIH awards at the regional level over the five-year period between FY 2014 and FY 2018. Boston led all regions in total NIH funding in FY 2018, while NIH funding in the Washington, D.C., region increased by the greatest percentage over the five-year period among major metropolitan areas.

As the largest public funder of biomedical research in the world, NIH awards are of particular importance to the technology-based economic development community. Including new data for FY 2017 and FY 2018, this edition of Useful Stats serves as an update to an August 2017 article highlighting NIH awards by state over the past decade. In FY 2018, NIH awarded a total of $28.3 billion in funds to the 50 states and territories. Of the total amount awarded in 2018, slightly less than two thirds (65.3 percent) went to the top 10 states. This share is slightly lower than in 2017 (65.6 percent), the same as in 2014 (65.3 percent) and slightly higher than in 2009 (66.1 percent).

This month, SSTI research has examined changes in total R&D and total R&D intensity for each state over a 15-year period from 2002 to 2016. In this final installment of the series, this article looks at how the performance of R&D in the states changed over time. In half of the states (25 states), the share of total R&D performed by colleges and universities increased more than any performer (e.g., industry, federal government) from 2002 to 2016. Meanwhile, 20 states saw industry’s share of total R&D performance increase more than any other performer. The share of total R&D performed by industry increased the most in Wyoming (32.7 percentage point increase), followed by Iowa (19.6 percentage point increase) and Missouri (18.5 percentage point increase).

How has the intensity of research and development (R&D) performance changed across states and over time? As a follow up to an article in last week’s Digest that examined changes in total R&D expenditures for each state over the 15-year period from 2002 to 2016, this week’s Useful Stats focuses on R&D intensity. Overall R&D intensity is defined as total R&D expenditures (the sum of all R&D performed by industry, federal labs and agencies, colleges and universities, and other research institutions in a state) as a share of each state’s gross domestic product in a given year.  Notably, five states stand out for exceeding the national average in both R&D intensity and increases in R&D intensity from 2002 to 2016: Oregon, Delaware, California, Maryland, and Massachusetts.

Despite its limitations, publicly available data on research and development (R&D) expenditures remains one of the best metrics for measuring state progress in the innovation economy. Defined as the sum of multiple National Science Foundation (NSF) measures – including business and industry R&D, higher education R&D, and R&D at federally funded centers – total R&D has skyrocketed nationwide over the past 15 years, though some states have experienced an outsized portion of this growth. Where has total R&D performance increased the most over the past 15 years? How has the composition of total R&D performance changed over this time? Perhaps most importantly, how has the intensity of R&D performance changed? Over the next three weeks, the Digest will explore the answers to these questions and more.

Data on total research and development stems from the NSF’s National Center for Science and Engineering Statistics’ (NCSES) National Patterns of R&D Resources series. In this article, SSTI has analyzed the available data for the most recent 15-years.

Although North Dakota’s per capita gross domestic product (GDP) has declined since 2013, the energy boom in earlier years gave the state the fastest increase over the past 10- and 20-year periods, according to an SSTI analysis of recently updated state GDP data from the Bureau of Economic Analysis. Beyond North Dakota, the 10 years from 2008 to 2018 benefitted per capita GDP in states with a prominent knowledge economy, led by New York, California, Washington and Massachusetts. In general, per-capita gross product serves as a useful metric because it can show a state’s relative economic performance against its peers and over time. This article examines state GDP per capita over the past 20 years.*