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Support for small companies has long been a pillar of federal and state policies meant to drive business formation, job creation, and the resulting spillover economic benefits for regional economies. The debate remains, however, about whether smaller or larger businesses play an outsized role in the nation’s economy.

Innovations are often born from small businesses, operating with few employees, if any at all, to bring new technologies and processes to market. However, new small businesses frequently fail and are not the only source of innovation.

Understanding the industry-level dynamics of business and job creation can help pinpoint which industries in regional economies may be hotspots for innovation activity.

Higher levels of business creation can be linked to the presence of innovation in a state through entrepreneurial activity and transitioning to new industries, and this edition of Useful Stats examines data from the Census Bureau’s recently updated Business Dynamics Statistics (BDS) on net establishment formation and the job creation stemming from those establishments in 2019. While figures vary widely among the states, most saw growth in both net establishment creation and net job creation in 2019; this data is prior to the onset of the pandemic in early 2020.

Understanding how federal funding for the science and engineering (S&E) activities of the nation’s institutions of higher education (IHEs) is distributed locally within states can help innovation leaders develop programs and policies tailored more carefully to the varying conditions of regional innovation economies.

Federal funding is a major source of support for the science and engineering (S&E) activities of the nation’s institutions of higher education (IHEs). This week’s edition of Useful Stats shows that in 2019 (the most recent year for which data is available), the vast majority — 87.6 percent or $33.4 billion— of that federal support came from only three agencies: the Department of Health and Human Services (HHS), the National Science Foundation (NSF), and the Department of Defense (DoD).

While rankings and annual indices are catnip for some looking to gain attention for their latest rankings, SSTI has always argued that it’s long-term trends that give the best sense of where a state or region stands. With recent release of income data, SSTI has examined the last 34 years data in median household income for each state. SSTI found that while median household income — adjusted to 2018 dollars — has risen in nearly every state and the U.S. since 1984 with an average annual rate of increase of 0.8 percent, the growth, not surprisingly, varies widely among individual states.

Business R&D activity has been historically concentrated in a few states and became even more so in 2017, according to a National Science Foundation issue brief on the latest Business Research & Development and Innovation Survey (BRDIS).

Developing local assets and nurturing local talent in science and engineering (S&E) is paramount to productive innovation economies. Institutions of higher education (IHEs) are arguably the most important elements of these local knowledge-capital assets — housing physical R&D infrastructure, training new scientists and engineers, and creating and disseminating new knowledge across the academic, public, and private sectors.

Editor's note: SSTI discovered that NASA updated their data which was used in this article after its publication. Specifically, the update included previously omitted 2020 application and awards data for Kentucky, Maine, Mississippi, and Nevada; and 2014 data for Iowa. While the changes to the data were minute, we strive to provide the most accurate and reliable data available. As such, the article and the interactive graphic below have been updated to reflect these changes.

Recession can drive increases in entrepreneurship as laid off workers look for other opportunities and start their own businesses. Increases in business startup activity throughout the 2020 recession were greater than any time in the 15 years prior. This edition of Useful Stats examines data from the Census Bureau’s Business Formation Statistics (BFS) series covering business initiation activity as indicated by applications for an Employer Identification Number (EIN).

Understanding enrollment trends at the nation’s institutions of higher education — an important indicator of the knowledge capital and skilled workforce available to local innovation economies — is paramount in developing appropriate strategies to bolster local and regional innovation and entrepreneurship. While many institutional reports cover only one or a few years’ worth of enrollment data, evaluating long-run trends can help policymakers and program designers identify issues that might otherwise be hidden, enabling the development of more effective policies and programs.

Enrollment in the nation’s institutions of higher education is an important indicator of the knowledge capital available to local innovation economies. This edition of Useful Stats explores enrollment data from the recently updated National Student Clearinghouse Research Center (NSCRC) report , Current Term Enrollment Estimates, covering spring term enrollment trends at degree-granting institutions of higher education.

This edition of Useful Stats explores data from the U.S. Patent and Trade Office (USPTO) on new utility and plant patents granted in the U.S. by state/territory for the five-year period from 2016 to 2020. This analysis includes only utility and plant patents as these types are those associated with the invention of new products and services, and excludes reissued patents and those issued for purely aesthetic designs.

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.

An SSTI data analysis finds that in FY 2020, small businesses were less successful in obtaining Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) funding from the Department of Health and Human Services (HHS) — particularly from the National Institutes of Health (NIH) — than they were in FY 2019.

The overall employment outlook for the recipients of doctorate degrees earned at U.S. institutions has improved from 2015 to 2019, while the research activities conducted by these highly trained and educated individuals has started to shift away from basic and applied research activities towards activities focused on design and development. Doctorate recipients play an essential role in developing the knowledge base leveraged in creating new technologies and companies in the innovation economy.

The R&D performed at colleges and universities is an important driver for the innovation economy — generating new knowledge, spurring invention, training STEM talent, and supporting economic development. This edition of SSTI’s Useful Stats analyzes metropolitan-level data for 2019 from the National Science Foundation on higher education R&D (HERD) expenditures and personnel. Nearly 981,000 individuals in higher education across the U.S. were classified as R&D personnel in 2019.

States often estimate their participation in the Small Business Innovation Research (SBIR) program by counting the number of awards made, total of award value, or (when available) the success rate of applications in their state. In this edition of SSTI Useful Stats, we attempt to go beyond these measures to estimate states’ untapped potential for capturing future SBIR awards. This creates a baseline proxy for tailoring and assessing a state’s outreach and support activities.

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.

This week’s edition of Useful Stats examines the contributions to county-level GDP in 2019 by industry group. Specifically, this analysis identifies the industries that contributed the most to the economic output of each county in 2019, finding that the real estate and rental and leasing; manufacturing; and government and government enterprises industry groups were vital economic drivers in terms of both their contributions to national GDP as well as the number of counties where they were the top contributor.