Useful Stats

Industry investment in research and development (R&D) indicates, literally, how invested each state’s businesses are in creating new products and processes. To better-understand industry’s commitment to innovation, business R&D can be viewed as a percentage of each state’s private sector gross domestic product (GDP), providing a measure of research intensity. This measure highlights substantial differences in the orientation of states’ businesses toward research, with some states seeing an investment rate of less than 1 percent while others are above 5 percent. The metric further reveals a broad trend that businesses in many states have stagnated their investments in R&D relative to the overall performance of the economy.

This week’s edition of Useful Stats examines the contributions to county-level GDP in 2019 by industry group. Specifically, this analysis identifies the industries that contributed the most to the economic output of each county in 2019, finding that the real estate and rental and leasing; manufacturing; and government and government enterprises industry groups were vital economic drivers in terms of both their contributions to national GDP as well as the number of counties where they were the top contributor.

The analysis also shows that the finance and insurance industry group and the professional, scientific, and technical services industry group were each top contributors to national GDP but were the top industry in relatively few counties, while the agriculture, forestry, fishing and hunting industry group and the mining, quarrying, and oil and gas extraction industry group were both ranked relatively low nationally but were top contributors to GDP in a significant number of counties.

A large majority (nearly 87 percent) of U.S. counties showed growth in their gross domestic product (GDP) from 2018 to 2019, according to an SSTI analysis of data from the U.S. Bureau of Economic Analysis (BEA). GDP is the measure for the total value of goods and services produced in an area, and is one of the primary economic indicators used by researchers and policymakers. This edition of Useful Stats examines the recently updated (BEA) data and provides an analysis of 2019 total county GDP, 2019 county GDP per capita, and the percent change in each measure from 2018 to 2019.

Deals raising at least $50 million grew by nearly one-quarter in 2020, driving an additional $18 billion in deal value to a new record of $156 billion invested. This data, from the PitchBook-NVCA Venture Monitor, suggests that the total venture capital market will see a slight decline in investment deals overall from 2020.[1] This slip in deal activity is driven by what is currently an 11 percent decline in seed or angel deals and a 20 percent decline in early venture capital deals.

This national trend held for many of the states in the country. Half of the states saw more money invested in 2020 than in 2019, with a 13 percent increase across the country in the year. Again, this investment volume occurred despite fewer deals in 2020 in all but 13 states. The states with more deals were Connecticut (+22 deals), Georgia (+3), Iowa (+13), Maine (+9), Massachusetts (+17), Michigan (+10), Missouri (+2), North Carolina (+18), Ohio (+4), Rhode Island (+4), West Virginia (+1), Wisconsin (+4) and Wyoming (+2).

A thriving innovation economy requires a robust R&D enterprise — with participation by academia, government, and the private sector. As a substantial performer and funder of R&D in the United States, the strength of private industry’s R&D activity in a region can provide an indication of the region’s capacity for bringing innovative technologies to market. Using data from the recent release of the National Science Foundation’s 2018 Business Enterprise R&D Survey, this SSTI analysis shows that while total R&D performed domestically by private companies in 2018 increased over 2017, as did the share of the R&D that was paid for by companies, this was not the case for all states.

An important element of a region’s innovation community is its knowledge capital, and one way to try to determine a locality’s knowledge capital is to examine the number of individuals receiving research-based doctorate degrees in the science and engineering (S&E) fields. The National Science Foundation (NSF) recently updated their Survey of Earned Doctorates with data for the 2018-2019 academic year. For the period ranging from July 1, 2018 to June 30, 2019, the number of total PhDs awarded increased nationally by 1.1 percent over the previous academic year to 55,703. The update also shows that the number of degrees awarded to recipients in S&E fields was 42,980. SSTI’s analysis explores the total number of S&E PhDs awarded per state, as well as the number of S&E PhDs per 100,000 state population.

Consideration of a state’s trends in the distribution of SBIR awards by federal agency may help program leaders and policy makers optimize the design and performance for state and regional support of innovation-based startups. For instance, knowing which federal agencies provide the dominant share of awards in a state can inform a program’s marketing and outreach efforts, and, more importantly for the startups being assisted, it can guide recruiting the right mix of mentors and knowledge assets to a program’s technical assistance capabilities. The data also can inform efforts to attract investors and potential customers with similar alignment of interests with companies in a state’s SBIR portfolio. SSTI’s focus this week on the agency distribution of SBIR awards by state over the past decade reveals some interesting insights. In the next edition of Useful Stats we will take a deeper dive into the data and examine awardee distribution trends at the regional level.

While business investments towards research and development have varied among states, the overall trend throughout the country has been a positive one. Business R&D funding has weathered two recessions over the past 20 years, with many states seeing investments grow beyond their pre-recession levels. While the scope of COVID-19’s economic impact continues to grow, business R&D investment has shown a strong history of recovering from, and building beyond, national financial downturns.

The total number of science and engineering (S&E) degrees awarded grew from 520,474 in 2000 to 955,401 in 2018, an increase of 83 percent, according to National Science Foundation (NSF) data. The portion of S&E degrees awarded compared to all degrees has increased as well, from a 2000 average of 31 percent of all degrees awarded to an average of 34 percent in 2018. S&E degrees includes bachelors, masters and doctoral degrees in areas such as life sciences, physical sciences and engineering.

Over the 19 years, Maryland, Vermont, Washington D.C., and Wyoming took various turns as the state with highest proportion of STEM degrees awarded.

During that time period, Washington had the greatest increase of S&E degrees relative to all degrees over time with an 11 percentage point increase (30 percent of all degrees awarded being concentrated in STEM in 2000 to 41 percent in 2018).

The largest increases in per capita income for metropolitan and micropolitan statistical areas (MSAs) within the United States have occurred primarily within the Western, Mountain and Great Lakes states, according to data recently released by the Bureau of Economic Analysis. Nearly every MSA experienced greater income levels in 2018 when compared to their 10-year average. More than 180 out of 385 MSAs experienced an income increase of greater than 10 percent in 2012 dollars, while only two MSAs (Enid, OK and Clarksville, TN-KY) measured lower income in 2018 than over their 10-year average.

The MSAs with the largest per capita income increase when compared to the previous decade were:

As the world begins to emerge from the “Great Lockdown” and governments increasingly turn their efforts towards reopening economies, many will look to past recessions for lessons on recovery. This edition of Useful Stats examines the rate of real GDP recovery by state following the recessions of 2001 and 2008.

According to their latest projections, the Congressional Budget Office expects that the U.S. economy will not recover from the current recession until after 2021. However, as seen after the recession in 2001 and again after the Great Recession of 2008, states recover at widely different rates. As shown in the map below, nearly every state had fully recovered to pre-recession levels of GDP within one year following the recession from March to November of 2001. Only three states took longer to recover — with Connecticut taking two years, and Delaware and New York both fully recovering after three years.

This edition of Useful Stats examines — by state and over the period from 2000 to 2018 — how many new establishments were founded, how many jobs these new establishments created, how many establishments closed, and how many jobs were lost from those closing establishments. In only one year, the last year of the period, 2018, all states experienced positive net gains in employment and establishments, based on data from the Bureau of Labor Statistics. As shown in the interactive map below, the states that had the greatest number of new establishments in 2018 were California (63,073), Florida (31,063), Texas (28,079), Washington (20,525), and New York (13,967). The states that experienced the greatest net employment numbers in 2018 were California (177,061), Florida (117,746), Texas (115,624), Washington (45,394), and New York (44,045).