Useful Stats: U.S. Research and Development Expenditures by Stage of Work, 2002-12

U.S. R&D spending began to rebound in 2011 and 2012 after several years of stagnation, according to new survey data released by the National Science Foundation. During the economic crisis of 2008-10, R&D expenditures froze at just over $400 billion. Newly revised data for 2011 and preliminary data for 2012 indicate that R&D spending began to recover in those years, outpacing U.S. GDP growth. This resurgence, however, has not materialized for all stages of research. While spending on applied research and development have bounced back, basic research spending decreased in 2011 and grew only slightly in 2012. The long-term U.S. shift in focus away from basic research appears to have accelerated in the aftermath of the economic crisis.

In an InfoBrief accompanying the survey data, NSF notes that in six out of eight years during the period from 2000-08, R&D spending grew at a higher rate than GDP. That trend stopped over the next three years as current dollar spending hovered around $406 billion. Both R&D spending and GDP actually declined in 2009, but as GDP began to recover in 2010, R&D remained static.

In 2011-12, however, R&D growth again overtook GDP growth. Total R&D spending, in current dollars, jumped from $407.7 billion in 2010 to $428.2 billion in 2011 and $452.6 billion in 2012. While GDP grew by 1.8 percent in 2011 and 2.2 percent in 2012 (according to preliminary figures), R&D spending grew by 2.8 percent in 2011 and 3.8 percent in 2012.

The longer-term trend illustrated by the survey data reveals that while expenditures have grown by a relatively meager 10 percent (in constant 2005 dollars) over the past five years due to the economic crisis, growth over the past 10 years has been more robust. Between 2002 and 2012, constant R&D spending grew by nearly 30 percent.

As of 2011, the U.S. remains first among all countries in total funding for R&D ($428.2 billion), but tenth in R&D intensity, according to the InfoBrief. China, the second largest performer of global R&D, spent less than half ($208 billion) of what the U.S. spent on R&D in 2011. Smaller, tech-focused countries, including Israel, South Korea and Finland, lead in R&D intensity.

While the overall resurgence in R&D spending is encouraging news for the U.S. economy, funding for basic research appears to remain stagnant. Basic research spending actually grew more during the 2008-10 period than during the ensuing recovery. Preliminary numbers indicate that basic research spending fell by 4.2 percent in 2011 and rose by only 0.9 percent in 2012. In constant dollars, basic research spending fell during both years.

The current NSF release includes data on annual R&D expenditures dating back to the 1950s. Over time however, many of the rules about how spending data is reported have changed, making historical comparisons less accurate. While the data on spending by stage of research begins in 1953, NSF notes that a number of definitional changes were made in 1998. For that reason, spending figures for basic research, applied research and development from 1997 and earlier cannot be precisely compared to figures from 1998 and after.

From the available data, it appears that basic research spending as a share of overall R&D spending in 2012 fell to its lowest point in a decade. Basic research represented 16.5 percent of expenditures in 2012, compared to 19.2 percent for applied research and 64.3 percent for development.

The NSF InfoBrief notes that universities and colleges remain the leading performers of basic research, with the federal government providing a majority of financial support for that stage of activity. The business sector continues to perform and financially support a majority of both applied research and development.

Access the National Patterns of R&D Research: 2011-12 Data Update at: http://www.nsf.gov/statistics/nsf14304/.

Download the following table in Excel format (xslx): http://ssti.org/sites/default/files/010813_0.xlsx.

U.S. Research and Development Expenditures by Stage of Work, 2002-12 (in USD millions)

* Figures for 2012 are preliminary