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Higher Education R&D expenditures jumped 8%, or nearly $9 billion, from fiscal year (FY) 2023 to 2024, reaching an all-time high of over $117 billion, reveals new Higher Education R&D (HERD) survey data. The funding sources of HERD expenditures remain proportionally unchanged from the prior year, with all sources increasing, and the federal government ($5 billion) and institution funds ($2.5 billion) accounting for the largest dollar increases.

With federal R&D investments unlikely to keep pace with inflation or international competition based on the administration’s budget request, cuts to existing research grants, and Congress’s inability to pass a budget, business R&D investments become more critical for sustaining the competitiveness of regional innovation economies.

From 2022 to 2023, domestic R&D expenditures increased 4%, or $29 billion, but remained nearly unchanged when adjusted for inflation. This apparent slowdown follows a streak averaging nearly 12% ($59 billion) year-over-year growth from 2018 to 2022, and 8% over the past decade from 2014 to 2023. Adjusting for inflation paints a different picture of the growth trends, with a more modest annual average of 8% from 2018 to 2022 and 6% over the past decade.

In fiscal year (FY) 2023, federal obligations for science and engineering (S&E) to universities and colleges totaled $49 billion—$29 billion more than FY 2000, and a 10% increase from the prior year. The growth is less rapid when adjusted for inflation (2017 USD), with just over $40 billion in real obligations in FY 2023, a 5% increase over the year prior and $12.6 billion (or 46%) increase over the FY 2000 value.

Most countries have dramatically increased their investments in R&D over the past two decades, with OECD nation spending reaching a record high nearly $1,600 of gross domestic expenditure on R&D (GERD) per person in 2023 (PPP[1] converted), approximately triple the value recorded in 2000. Although the U.S.

A recently published InfoChart from the National Center for Science and Engineering Statistics (NCSES) presents an annotated walk through federal R&D obligations from FY 1951 through 2024, explaining key events influencing key moments in the surges and downswings along the nation’s path to supporting discovery, research, development and innovation. The data is presented in constant 2017 dollars. 

As this week’s recent research article mentions, R&D tax credits work, so it isn’t surprising several states have either proposed, amended, or enacted research and development (R&D) tax credits for both the current fiscal (2025) and new (2026) fiscal year in efforts to encourage innovation and economic growth. Some specifically target life sciences or biotechnology sectors while others focus on attracting new or existing companies and startups or to further develop life sciences and/or biotech sectors and hubs.

Higher education R&D (HERD) expenditures have steadily increased over time. They’ve soared past $100 billion in the most recent data year, fiscal year (FY) 2023, growing in every state. However, the gains are not shared equally in all fields of research.

Readers may have noticed the most populous states end up topping many of the statistical tables related to economic development. Normalizing the data by some relevant, related measure can provide a higher quality look that is a little closer to the “apples to apples” appeal that might help influence some policy issues. For this week’s edition of Useful Stats, SSTI is exploring research intensity as a component of state gross domestic product (GDP) and the research load “carried” by each member of the R&D personnel within the state’s higher education community.

Higher education R&D expenditures, while continuing to steadily increase, have not grown evenly across state lines. This matters to successful TBED policymakers because a strong R&D enterprise within a state’s public and private institutions of higher education can and should provide a consistent source of skilled workers, new technology, and sources for innovation-driven business growth. So where is R&D growing?

The most recent  Higher Education R&D (HERD) survey revealed the largest year-over-year percentage increase in higher education R&D since 2002 to 2003 and dollar increase across all fiscal years (FYs) captured by the survey. HERD expenditures breached the $100 billion mark in 2023, having grown 11% from $97.8 billion in 2022 to $108.8 billion in 2023 (7% in constant 2017 dollars, from $82.9 to $89 billion).

The European Union is engaged in a debate about changing its systems for R&D funding, the first potentially significant changes since its current framework program began in 1984. A group of 15 individuals from research and industry selected by the European Commission last year has submitted a report, Align, act, accelerate, which gives recommendations for overhauling the system.

Manufacturing industries accounted for approximately $372 billion, or 54%, of all domestic business enterprise R&D (BERD) expenditures in 2022, up 36% from $274 billion in 2018. Despite this increase of nearly $100 billion over the past five years, the share of BERD expenditures in manufacturing industries has decreased eight percentage points from its 2018 value of 62%.

While both gross domestic product (GDP) and population have steadily increased across the United States over the last decade, the growth of business enterprise R&D (BERD) expenditures has surged ahead at an even faster pace.

As business R&D expenditures continue to increase nationwide, disparities between states deepen, an SSTI analysis of new Business Enterprise Research and Development (BERD) survey data reveals.

Domestic business R&D expenditures have jumped 15% ($89 billion) from 2021 to 2022. This jump continues a decade-long trend of year-over-year increases, as a new 2022 Business Enterprise R&D (BERD) survey shows.

For the last 40 years, higher education has been the dominant performer of basic research in the United States, but there has been a slide in higher education’s share over the last 20 years as businesses have increased their performance of basic R&D (Figure 1). If the current trendline continues, businesses will soon surpass higher education as basic R&D performers and become the predominant basic R&D performer just as they have been in applied R&D for decades.

During a recent webinar presented by the National Semiconductor Technology Center (NSTC), center representatives announced details of its initial round of R&D funding opportunities, as outlined in its vision for 2024 document. The projects to be funded, which NSTC refers to as Jump Start Projects, are (1) AI-based Radio Frequency (RF) Design and (2) Test Vehicles.

In the 21st century, some high-tech firms in emerging fields are valued more for their perceived innovation potential than by traditional measures of a successful business. But how does innovation influence the value of existing publicly traded firms?

The U.S. Small Business Administration (SBA) has announced the 2024 Growth Accelerator Fund Competition (GAFC) Stage One winners. Each received $50,000 in prize awards for impactful and inclusive approaches to foster a thriving, collaborative national innovation support ecosystem to advance small business R&D.