Useful Stats: Gross R&D Expenditures and Intensity for Select Countries, 2006-11

The U.S. remains the global leader in research and development (R&D) spending, but its share of global research is on the decline, according to the National Science Board’s (NSB) Science and Engineering Indicators 2014 report. U.S. R&D expenditures, including government, private and academic spending, reached about $428 billion in 2011 (see our previous Digest article on U.S. R&D spending), representing a 21.4 percent increase over 2006. Over the past decade, however, the U.S. share of global spending has fallen from 37 to 30 percent. Much of the decline is due to growing research activity in East, Southeast and South Asia.

While much of the coverage of the NSB release has focused on projections that China may one day overtake the U.S. in research spending, the U.S. continues to lead the world in R&D expenditures by a large margin. Knowledge and technologies industries (KIT), as defined by NSB, play a vital role in the U.S. economy, representing about 40 percent of U.S. GDP. These industries include high-tech manufacturing, such as aviation and pharmaceuticals, and knowledge services, such as finance, communications and software. KIT industries play a more important role in the U.S. economy than any other large, developed country, with KIT intensity in peer nations averaging 30 percent.  The U.S. economy also ranks as one of the more R&D intensive economies. In 2011, U.S. R&D expenditures were equal to about 2.85 percent of the nation’s GDP. U.S. R&D intensity by state was discussed in a previous Digest article.

European Union (EU) countries, as a whole, represent the second largest share of global R&D, spending about 22 percent of the worldwide total. As in the U.S., this share has declined in recent years, falling from 26 percent in 2001. Among the larger EU countries highlighted in the NSB report, only Germany has an R&D intensity greater than the U.S., spending the equivalent of 2.88 percent of its GDP on R&D. A number of smaller EU states also have R&D intensities higher than the U.S., including Finland, Sweden, Denmark and Switzerland.

China has rapidly increased its share of global R&D spending over the past 10 years, but continues to lag well behind the U.S. In 2000, China represented only 2.2 percent of R&D, but now makes up 14.5 percent of global spending. Due to China’s impressive growth over the past decade, the combined R&D spending of East, Southeast and South Asian countries now exceeds that of the U.S. Together, China, India, Japan, Malaysia, Singapore, South Korea and Taiwan represent about 34 percent of global R&D spending.

The NSB attributes China’s rise to increased research activity in high-tech manufacturing. Between 2003 and 2012, China’s global share of high-tech manufacturing activity grew more than five-fold, from 8 percent to 24 percent. China’s growth in manufacturing has put the U.S. lead in that sector in jeopardy. The U.S. remains the largest single source of global high-tech manufacturing, with 27 percent, but likely will be overtaken by China in the near future.  Knowledge industries, however, continue to be an area of strength for the U.S., which provides 32 percent of commercial knowledge-intensive services.

Access NSB’s Science and Engineering Indicators 2014…

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