The State of R&D Spending in the U.S.

An article in the September 3rd edition of the New York Times explains that while the U.S. remains the leader in the total R&D spending, accounting for the 34% of the world total, we rank only seventh in R&D spending as a percentage of GNP, trailing Sweden, Finland, Japan, Switzerland, Iceland and South Korea.

"The government is spending a smaller and smaller amount of our economy on R&D, and that comes at a time when other countries are dramatically increasing their investments. It raises big concerns for the future of U.S. innovation, " says Kei Koizumi, director of the research and development budget and policy program for the American Association for the Advancement of Science (AAAS). In the meantime, China and South Korea, for example, have substantially increased their research funding, by 10 percent or more anually in recent years. In terms of dollars invested in basic research as a percentage of R&D, the U.S. ranks 11th; in the amount invested in nondefense research as a percentage of the economy, we rank 22nd.

Government R&D investment has been a declining priority for the U.S.  Government for the last few decades. In the mid-sixties, the U.S. Government provided 67% of R&D spending; today, the number hovers around 30%. While much of the difference has been made up by an increase in corporate R&D investment, many businesses have strenghthened research relationships in foreign nations, most notably in Asia, raising concerns about how benefits will trickle back to the U.S.