Rosy Forecast for R&D Spending

Total research and development investment in the United States was strong in 2000, and is expected to increase about five percent in 2001, according to two separate reports recently released by Battelle Memorial Institute and the National Science Foundation.



Since 1994, spending on R&D in the United States has risen sharply, from $169.2 billion to a projected $264.2 billion in 2000, according to NSF, which issued Data Brief 01-310 Sixth Year of Unprecedented R&D Growth Expected in 2000 before the end of the year. That is the greatest single increase for any six-year period in the history of collecting R&D data, NSF said.



Battelle-R&D Magazine’s research and development forecast predicts that $277 billion will be spent on R&D in 2001. U.S. R&D investments remain largely driven by industry, which is anticipated to spend $190 billion this year, a 6.5 percent increase over the previous twelve months. Battelle cautioned that the unpredictable state of the dot-com world and stock market fluctuations could affect its forecast. Spending by the federal government will increase slightly by 1.3 percent to $72 billion, and academic institutions and other non-profit organizations will spend about $15 billion in 2001, which is about 6.2 percent more than last year.



NSF reported that federal R & D support in 2000 was about $71.2 billion, just a one percent real increase per year since 1994, and the government’s share of support for the nation’s R & D has dropped steadily since 1979 when it fell below 50 percent for the first time. NSF estimates that in 2000 the figure was 26.9 percent.



Battelle predicts that industry will continue to emphasize various forms of partnering and collaborations, including relationships with other industry, federal laboratories and international facilities. Many of these partnerships will most likely continue to concentrate on those aspects of basic and applied research, which are far from commercialization, but which are necessary for the establishment of stronger platforms for future technology growth.



Excellent business conditions, a strong economy and enhanced tax revenues continue to fuel a federal budget surplus, thus potentially easing some past pressures on government support of R&D. Factoring in the change in administration, continued modest growth of federal commitment to a broad range of R&D programs is expected, if the economy remains strong and the revenue stream continues to flow, Battelle said.



Recent significant gains in biomedical and health-related R&D will continue. Federal government commitment to health-related R&D has been instrumental in spurring the growth of private industry funding in this area, according to Battelle.



The complete Battelle and R&D Magazine forecast is published annually in the January issue of R&D Magazine. It can be accessed online at http://www.rdmag.com/home.htm

The NSF Data Brief, Sixth Year of Unprecedented R&D Growth Expected in 2000, can be downloaded at http://nsf.gov/sbe/srs/databrf/nsf01310/sdb01310.htm