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.

It appears that innovation is contagious. Maps reveal that once there is a concentration of patents granted to inventors in one U.S. county, innovation starts to percolate in neighboring counties. And the phenomenon isn’t found only in established life sciences hubs like San Diego or Boston. SSTI observed this spillover effect in Washtenaw County, Michigan and Hennepin County, Minnesota, among other places. These data suggest that when a strong base is located, likely due to new companies and startups establishing themselves, innovation lays down its roots and spreads to other counties.

The 2021 BERD dataset reveals the highest level of business R&D spending on record. Since 2015, R&D expenditures have increased by 69% from $356 to $602 billion, representing an average annual growth of $41 billion or 9%. But what industries are contributing the most to this trend?

Graduate student enrollment and postdoctoral appointments have shifted in fields of study over the past decades, with many fields exploding in graduate enrollment and postdoctoral appointments. Computer and information sciences graduate students jumped from just 4% of all science enrollments in 1975 to nearly a quarter of the total by 2021, while engineering postdocs in biological, biomedical, and biosystems engineering jumped 5,671%– increasing from 3% in 1975 to 19% of all engineering postdocs by 2021.

The number of graduate students in science, engineering, and health has grown from approximately 328,000 to 760,000 from 1975 to 2021, a 132% increase, according to the National Science Foundation’s (NSF) Survey of Graduate Students and Postdoctorates in Science and Engineering (GSS).

Total postsecondary enrollment is down 5% from fall 2019 to fall 2023 due to a 6% drop in undergraduate students. While undergraduates are down, graduate students have surpassed pre-pandemic enrollment numbers by 4%. Enrollments in undergraduate and graduate certificates are up significantly from pre-pandemic values (16% and 21%), while enrollment in associate degrees are down more than any other undergraduate credential (-14%).

The real gross domestic product (GDP) of private industries has steadily increased nationwide from 2018-2022, with an average percentage increase of 2% each year, or 9% total, despite a drop from 2019-2020 due to the pandemic. However, the same cannot be said across all private industries; of the 14 broad industries captured by U.S. Bureau of Economic Analysis (BEA) data,[1] eight have grown while six decreased over the five-year period from 2018-2022.

Information on the geographic distribution of innovation and entrepreneurship is not easy to tease out of many federal statistical data sets, leading regional policy often to be based on trends in all business starts or life span and size—ignoring the fact that some firms have greater impact on regional economic growth than others. The U.S. Census Bureau is well aware of the challenge and, earlier this week, released an experimental data set that allows for an examination of state-level long-term trends in the change in high-growth firms and establishments across the nation.

This article, including the downloadable data sheet, visuals, and analysis, was updated on July 10th, 2024, to include new data from Treasury’s SSBCI Capital Program Summaries.

This article was edited on April 4th, 2024, to correct for an error in, and add to, the original data. Refer to the note at the bottom of this article for more detail.

High-growth firms are often conflated with all other firms. Unfortunately, this tendency makes it extremely difficult to differentiate those with a higher likelihood of significantly impacting the economy and innovation.

Shrinking shares of job-creating, high-growth firms across the country, the topic of SSTI’s Useful Stats column in last week’s Digest, is not being experienced within all sectors of the economy, according to analysis of the Business Dynamics Statistics of High Growth Firms (BDS-HG) experimental dataset from the Census Bureau.

Despite a $4.1 trillion increase in annual output since 1987, manufacturing industries in the United States have been declining in both their labor productivity and share of output. The Bureau of Labor Statistics’ labor productivity (output per hour) index, tied to 2012 values, for manufacturing industries has dropped by nearly five points since its all-time high of over 101 in Q2 2013.

United States venture capital activity not unexpectedly slowed down in 2023, cooling off after multiple years of record-high deals and values during 2021 and 2022, according to the PitchBook-NVCS Venture Monitor Q4 2023. Pitchbook-NVCS estimates a total deal count of 15,766 (13,608 actual + 2,158 estimated) for 2023– exceeding the values of 2020 and prior years but falling several thousand short of the last two years.

Income inequality in the U.S. has increased from 2006 to 2022, according to American Community Survey (ACS) data. While it’s increased in the nation as a whole, it decreased in North Dakota, Washington, Hawaii, Nebraska, and Montana from 2018 to 2022. New York and Washington, D.C. lead the nation in income inequality. This edition of Useful Stats explores state-level Gini index data from the U.S.

The United States has one of the most diversified economies of any nation, yet also the most dynamic; over the past five years, from 2018 through 2022, the U.S.’ agriculture, forestry, fishing, and hunting industry has grown 53%, while other industries such as manufacturing and construction have grown at a slower pace—17% and 23% respectively—compared to a 25% increase in overall gross domestic product.

The United States' 42 federally funded research and development centers (FFRDCs) received a record $26 billion in federal government funding in fiscal year 2022 — a nearly 6% increase compared to the previous year. FFRDCs expended $26.5 billion on R&D in FY 2022, marking the ninth consecutive year of nominal growth. On average, FFRDCs have increased R&D expenditures by 1.3% per annum since 2012.

With a GDP of over $23 trillion in 2021, the United States has the world's largest economy, according to the latest available data from the World Bank. Yet, the U.S. falls behind such countries as Israel and Korea when it comes to how much is spent on research and development (R&D) in proportion to GDP. For example, Israel and Korea spend 5.56% and 4.93% of their GDP on R&D compared to the U.S.’ 3.46%.

SSTI has released a new data tool that defines investment activity, one indicator of the vibrancy of a region’s innovation economy, in each of 18 technology areas.

Led by increases in retail trade and professional, scientific, and technical services, the number of annual business applications nationwide has increased 119%, or nearly three million, from 2005 to 2023. However, the share of applications classified as high-propensity, or those more likely to result in businesses with a payroll, has decreased in all but the health care and social assistance sector, leading to a 26-percent point drop (58% to 32%) over the same period.

Business applications have greatly increased over the last two decades, jumping 119% from 2005 to 2023. However, the rate of high-propensity business applications—applications identified by the Census Bureau as having higher likelihoods of turning into businesses with payroll—have decreased as a share of all applications every year since 2005, despite having grown 22% over the same period.

While the growth of female-founded and co-founded companies has increased at a faster rate than those of male-founded and co-founded and mixed gender founded companies, it is still a smaller amount than the other two. Additionally, these companies are more likely to receive a higher proportion of deals occurring earlier in the VC pipeline.

Coming out of the COVID-19 pandemic, the median net worth of Americans jumped an inflation-adjusted 37%, from approximately $141,000 to $192,000, representing the largest increase reported across available data from the Federal Reserve’s Survey of Consumer Finances (SCF). Breaking net worth down into its two main components, assets and debts, shows that while debts have increased, the sharp rise in assets—both financial and nonfinancial—has driven these numbers.

The measurements for success of female-founded and female-co-founded companies, while improving, remain lower than male-founded companies in number, deal count, and capital invested, according to PitchBook’s 2023 Annual US VC Valuations Report. PitchBook found that female-only-founded startups received just 2% of all venture capital (VC) dollars in 2023, while those female-co-founded reached 21% that year—a record high.

In 2000, the United States was among the global leaders in educational attainment, boasting the third-highest percentage of its 25- to-64-year-old population with a postsecondary degree across the 38 Organization for Economic Co-operation and Development (OECD) nations. However, over the past two decades, the U.S. has gradually slipped in the rankings, falling to ninth place by 2022 even as the percentage of the population with a postsecondary degree increased from 36% to 50%.

The educational landscape of the United States has undergone significant transformation over the past three decades, with the percentage of individuals 25 and older having earned a bachelor's degree steadily increasing since the 1990s. Nationwide, 20% of those aged at least 25 had a bachelor’s degree in 1990, while in 2021 this figure jumped to 38%. However, educational attainment varies greatly across states. Many states, such as Massachusetts, Maryland, Colorado, New Jersey, and Rhode Island, alongside 15 other states, fall above the national value of 38% in 2021.