38 R&DMagazine December 2013 www.rdmag.com
2014 GLOBAL R&D FUNDING FORECAST
U.S. R&D – Small Increase in 2014
In the United States, R&D spending is likely to increase in 2014,
turning the corner from near-zero growth in 2013. Federal funding
is difficult to forecast because of the breakdown of orderly budget
processes, but there are indications of bipartisan political support
for increases or reallocations that favor R&D. Historic post-recession economic data suggest that private-sector R&D spending will
also increase in 2014.
• U.S. R&D investment will increase by 1.0% (after inflation) to
• National research intensity will remain stable at 2.8% of GDP.
• While government R&D funding is forecast to increase, flat or
reduced spending are possibilities.
• The private sector continues to account for about three-quarters
of U.S. research activity.
Factors that Influence the 2014 Outlook for U.S. R&D
Except for a dip in the 1970s at the point where industry surpassed
government as the dominant research sponsor, the U.S. total commitment to R&D has ranged between 2.5% and 3% of GDP for
decades, according to historic data from the National Science Foundation. Research intensity has been correlated with macroeconomic
growth, and has been the foundation of U.S. technological innovation. This evidence of impact and economic return may account for
much of the stability in the portion of U.S. GDP which is devoted
to research. In addition, there may be a stabilizing portfolio effect
in the complementary roles of public and private research, as well
as the diversity of societal objectives and commercial markets they
The reliable trend in research intensity continued in 2013 ( 2.8%),
although multiple contemporary factors influence the prediction of
2014 activity. Among the most important are political and economic conditions in the U.S., as well as globalization of markets, companies, research capabilities and collaborations.
Four sources of R&D funding—the federal government, industry, academia
and non-profit organizations—also perform R&D.
Additional funding flows
to academia from state
and local governments.
R&D is also performed by
federally funded research
and development centers (FFRDCs), some of
which are operated for the
government by industrial
firms, non-profit research
institutes or universities.
The 2014 Source-Performer Matrix
Performer of R&D
d s Sou
Despite federal spending uncertainty, a case for optimism in research levels
US$ Billions (Percent Change from 2013)
(Gov't) Industry Academia Non- Profit Total
$35.7 16. 5 27. 8 37.1 6.0 123.0
1.0% 1.1% 1.1% 2.5% 1.1% 1.5%
0.3 302.5 3. 3 1.4 307.5
0.7% 4.1% 1.7% 0.5% 4.0%
0.1 13. 2 13. 3
0.1% 2.0% 1.9%
0.0 4.0 4.0
0.1% 1.1% 1.0%
0.1 5. 3 11. 3 16. 7
0.2% 2.2% 4.0% 3.4%
$35.7 17.0 330.3 62. 9 18. 7 464.5
1.0% 1.0% 3.8% 2.2% 2.7% 3.2%