SSTI Digest

Last week (Jan. 3), Maryland’s state comptroller released the state’s first State of the Economy report. The 110-page document uses publicly available data, academic research, and government studies to analyze relevant economic indicators within the state. It compares that data across neighboring states and nationally to better understand the current economic climate and to help Maryland policymakers understand the sources of weakness, as well as identify the strengths and opportunities available, and to leverage those resources for more sustained, long-term economic growth. The report found that, despite Maryland’s advantages (high median household income, low unemployment, a diverse economy, and proximity to academic research universities and federal agencies), the state’s economic growth has been slowing since 2017, with the state’s population growth sputtering years before the economic and wage growth stalled (all of which happened well before the COVID-19 pandemic), and remains stagnant today. The analysis also reveals that Maryland substantially lost lower- and middle-income workers to other areas with cheaper housing, and a larger number of working women left the…

With the start of the new year, governors have begun to deliver their State of the State addresses, laying out proposals for new programs and discussing the conditions of their states. As states’ revenue levels return to more typical levels, lawmakers, with a few exceptions, are taking a more cautious, or constrained, view of their funding priorities and proposed initiatives. Many governors also appear to be more restrained in their addresses this year, speaking more to the previous year’s successes, suggesting lawmakers tighten their state’s fiscal belts while providing targeted investments into key or signature programs, as well as previously proposed initiatives, rather than rolling out new programs, except in the innovation space related to semiconductors and recently announced tech hubs.   Every year, SSTI reviews the State of State and budget addresses for any newsworthy developments or initiatives that governors may discuss or propose as they relate to the innovation economy. The following highlights have been excerpted from State of the States or budget addresses given between December 2023 and January 9, 2024, by governors from Arizona, Florida, Idaho,…

The U.S. Small Business Administration (SBA) announced the 2024 Growth Accelerator Fund Competition (GAFC) on January 8. The competition offers $50,000 to $200,000 in prize awards “for impactful and inclusive approaches to foster a thriving, collaborative national innovation support ecosystem to advance research and development (R&D) from ideas to impact.” The competition is not intended to provide capital directly to companies for R&D projects. The prizes will be awarded in two stages. The stage one application portal opens on January 8 for a five-week window. This stage offers $50,000 in cash prizes awarded to organizations for ecosystem-building activities, including recruiting new partners and strengthening existing alliances among stakeholders, including public, private, non-profit, and academic partners. Contestants work collaboratively with chosen partners to bring additional resources, deepen network connections, and develop strategies to support STEM/R&D-focused entrepreneurs and small businesses. SBA welcomes stage one submissions from organizations with a collaborative vision to nurture a national ecosystem for equitable access to entrepreneurship…

In 2021, U.S. microbusinesses reported $8.1 billion in research and development (R&D) expenditures, of which the microbusinesses themselves performed 75% ($6.1 billion) The $6.1 billion in microbusiness-performed R&D represents an increase of 9% over the prior year and 17% since 2019. Microbusinesses are those with nine or fewer employees. The Annual Business Survey (ABS), cosponsored by the National Center for Science and Engineering Statistics (NCSES) and the Census Bureau, collects data on U.S. microbusinesses that perform or fund R&D. ABS is a fairly new survey, with the first data year dating back to 2017, and has experienced changes to its methodology between certain data releases. Refer to the ABS methodology for more information. The data used in this article should be interpreted cautiously, as some company count and R&D performance values may be excluded for certain years, and not others. This practice is often done to protect the identities of microbusinesses, but may cause the values calculated in this article to be higher or lower than reality. Please refer to ABS for more information. This edition of Useful Stats will…

The U.S. Department of Commerce's Economic Development Administration (EDA) recently announced the 22 finalists of the Distressed Area Recompete Pilot Program (Recompete) and 24 Strategy Development Grants. Recompete, authorized through the CHIPS and Science Act, targets the hardest-hit and most economically distressed areas of the country, specifically ones where prime-age (25-54 years) employment is significantly lower than the national average. Projects that are ultimately selected for funding connect workers to good jobs in geographically diverse and persistently distressed communities nationwide. The finalists will now submit proposals for $20-50 million. The Strategy Development Grants will be used to help communities significantly increase local coordination and planning activities. Such development could make selected grantees more competitive for future Recompete funding. The Recompete finalists are located across 20 states and territories and represent a cross section of urban and rural regions. According to a press release from EDA, of the 22 finalists, seven are focused exclusively on rural American communities, and five are led by or involve tribal…

The United States is home to some of the world's most prestigious universities, each performing critical research that helps advance the country’s innovation economy. However, these universities are not evenly distributed across the country; many are concentrated within large cities in states where their spillover further impacts the local economies. This edition of Useful Stats explores Higher Education Research and Development (HERD) Survey data from the newest fiscal year (FY) 2022 data release. Specifically, a state and institution-level look at HERD expenditures over the last decade of available data will be conducted to explore any trends.   State-level trends in HERD Research and development (R&D) expenditures neared $100 billion across the U.S. in FY 2022, a 9% increase from FY 2021’s $89.8 billion and a 46% increase from FY 2013’s $67.1 billion. Twenty-seven states had higher education R&D expenditures totaling over $1 billion in FY 2022, while an additional nine states and Washington, D.C. had less than a billion but more than half a million. The remaining 14 states and Puerto Rico had between $100-500 million in HERD…

The National Science Foundation recently announced awarding more than $100 million to 18 teams at academic institutions across the nation through the Accelerating Research Translation (ART) program. An NSF press release states, “NSF's investment will enable academic institutions to accelerate the pace and scale of translational research that will grow the nation's economy.” Each ART awardee will receive up to $6 million over four years to identify and build upon academic research with the potential for technology transfer and societal and economic impacts, to ensure the availability of staff with technology transfer expertise, and to support the education and training of entrepreneurial faculty and students. Each ART awardee institution partners with a mentoring institution of higher education with a robust ecosystem for translational research. At least 15 universities are among the partner mentoring institutions that are part of the ART network formed by this cohort of awardees. The complete award list can be found here. NSF estimates that there will be up to 10 awards per round of this solicitation. The next deadline date is September 18, 2024. Thereafter, the…

A bipartisan report from the House Select Committee on the Chinese Communist Party says the People’s Republic of China (PRC) has failed to live up to the foundational principles of the World Trade Organization—open, market-oriented, non-discriminatory treatment. In its report, "Reset, Prevent, Build: A Strategy to Win America's Economic Competition with the Chinese Communist Party," the committee calls for resetting the U.S.'s economic relationship with China. They propose to do so, in part, through new research security measures and controls on technology exports. The report is organized under three pillars: Reset the terms of our economic relationship with the PRC. Stem the flow of U.S. capital and technology fueling the PRC's military modernization and human rights abuses, and Invest in technological leadership and build collective economic resilience in concert with allies. The report authors note that the first two pillars focus on defensive actions against the CCP’s economic warfare campaign.But the final pillar goes on the offensive, calling for the U.S. to invest in technological leadership and build economic resilience. Reset our economic…

The U.S. Department of Energy (DOE) recently announced the Office of Critical and Emerging Technology launch. A DOE press release explains that the office has been created “to ensure U.S. investments in areas such as artificial intelligence (AI), biotechnology, quantum computing, and semiconductors leverage the department’s wide range of assets and expertise to accelerate progress in these critical sectors.” Critical and emerging technologies, such as clean energy, national defense, and pandemic preparedness, have broad applications throughout DOE. According to the press release, “(m)ajor advances in critical and emerging technologies hold extraordinary potential for the economy and national security but also pose significant risks, and DOE’s new office will focus the department’s efforts ensuring that its capabilities are helping to solve critical science, energy, and security challenges.” Helena Fu, who was senior advisor to the undersecretary for science and innovation after serving as director for technology and national security at the National Security Council, was named director of the new office. Fu will also serve as DOE’s chief artificial intelligence…

The National Defense Authorization Act for FY 2024, signed in late December, ultimately contained fewer provisions related to research, technology, and entrepreneurship than the draft versions of the legislation initially proposed. Nonetheless, the final bill made some changes that could stabilize some of the department’s innovation activities in recent years and add some flexibility for companies and organizations engaging in technology transfer activities with defense institutions. Specifically, four sections worth noting in the FY 2024 NDAA are the following: Codification of the Office of Strategic Capital, which was launched in 2022, and a loan program to support emerging technology needs. Formalization of the Defense Innovation Unit (DIU), which includes making the director a principal staff assistant to the Secretary of Defense, allowing DIU to use federal “other transaction authority” (OTA) agreements, and requiring DIU to provide support to multi-stakeholder research and commercialization partnerships. Requirement that each military department designate a principal technology transition advisor to advise on technology transfer and acquisition opportunities.…

Activity to build the U.S. semiconductor industry picked up steam on Monday, December 11. On that day, New York State, Gov. Kathy Hochul announced the state was committing $1 billion to what her office described as “a $10 billion partnership with leaders from the semiconductor industry such as IBM, Micron, Applied Materials, Tokyo Electron, and others to establish a next-generation semiconductor research and development center at NY CREATES’ Albany NanoTech Complex.” Also on that day, the U.S. Department of Commerce announced the U.S. Department of Commerce and BAE Systems Electronic Systems, a business unit of BAE Systems, Inc., have signed a non-binding preliminary memorandum of terms (PMT) to provide approximately $35 million in federal incentives under the CHIPS and Science Act to support the modernization of the company’s Microelectronics Center in Nashua, New Hampshire. The newly announced partnership in New York State will, according to a statement from the governor’s office, “fund the construction of a cutting-edge High NA Extreme Ultraviolet Lithography Center … that will support the research and development of the world’s most complex and powerful…

Research and Development (R&D) is an essential component of innovation and economic growth, where higher education institutions play a key role. However, with these institutions being responsible for funding just a quarter of all HERD expenditures, it is important to see the influence of outside funding sources on the fields of R&D. For example, Health and Human Services (HHS) has long been the largest contributor of funding into higher education R&D, which is reflected in life sciences being the R&D field with the most significant funding levels. This edition of Useful Stats uses higher education research and development (HERD) survey data at the R&D field level to explore where the nearly $100 billion in R&D expenditures is going.   HERD expenditures in science, engineering, and non-S&E by source of funds Science and engineering (S&E) fields have historically accounted for most higher education R&D expenditures and continue to do so with a 94% share of HERD expenditures in FY 2022. However, the proportion of science, engineering, and non-S&E fields differs depending on the source of funds; federally…