r&d

When planning and evaluating programs and policies in local and regional innovation economies, a key measure is the amount of private business research and development (R&D) activity taking place, typically found in the Business Enterprise Research & Development Survey (BERD). The Census Bureau, in cooperation with the National Science Foundation’s National Center for Science and Engineering Statistics (NCSES), is seeking public comment on planned updates to the BERD survey.

Federally funded R&D is a pillar of the U.S. innovation economy, and understanding how that funding is disbursed among the various performers within a state can help regional innovation leaders in developing, designing and implementing investment strategies, programs, and policies.

The level of federal R&D funding within a state can have important implications for local innovation economies. As such, understanding the amount of federal R&D funding and which agencies provide that funding within a state can help regional innovation leaders in designing and implementing programs and policies. This edition of Useful Stats explores NSF’s recently updated data on federal R&D funding obligations in 2019 by state and agency.

Alabama is the latest state that is embracing innovation as a way to grow the state’s economy. On May 19, Alabama Gov. Kay Ivey signed legislation that grew from two top priority measures of the Alabama Innovation Commission — proposals discussed between SSTI and commission members in a meeting earlier this year.

As noted in our separate overview, the 25-page American Jobs Plan provides goals, highlights and proposals, but also raises questions about how proposals would be implemented and even exactly how much money would be spent.

While President Biden’s infrastructure proposal with heavy investments in science, technology and innovation garnered most of the press attention in the last week, a number of other developments occurred in or impacting federal policy, including:

Metropolitan areas in the U.S. with fewer than 370,000 residents are more likely to be more economically reliant on R&D performed by colleges and universities than larger metros, according to new SSTI analysis. Three data points are used to consider how R&D at institutions of higher education is impacting a region’s economy: NSF’s Higher Education R&D (HERD) data on expenditures at individual institutions; metro area Gross Domestic Product (GDP) data from the Bureau of Economic Analysis; and population estimates from the Census Bureau.

Given higher education’s role in generating the knowledge that catalyzes innovative new technologies developed by high-growth startups, R&D conducted at institutions of higher education is one of the most important metrics for evaluating an area’s innovation economy. This edition of Useful Stats examines NSF’s recently updated Higher Education R&D (HERD) survey, finding that most states, although not all, experienced growth in HERD expenditures from 2018 to 2019.

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.