Financial Resources for Academic R&D

R&D conducted by higher education institutions is a key component of the overall U.S. R&D system. In 2018, the higher education sector performed 12% ($74.9 billion) of the overall $606 billion in U.S. R&D, a proportion that has fluctuated within a narrow range for several decades (Figure URD-1; NCSES NP 2019: Table 2; for more detail on research performance by other sectors, see the forthcoming Indicators 2022 report “Research and Development: U.S. Trends and International Comparisons”). Although universities perform all types of R&D, they have long been the nation’s largest performers of basic research (for definitions of basic research, applied research, and experimental development, see the Glossary section). In 2018, they performed $47 billion in basic research, or 46% of the national total. After a period of increase beginning in the early 1990s, the proportion of U.S. basic research performed by the higher education sector declined over the last 10 years of available data. Higher education institutions also performed about 18% ($20.9 billion) of all U.S. applied research and less than 2% ($7 billion) of all U.S. experimental development in 2018; these percentages have increased over the last 10 years.

Academic R&D as a percentage of U.S. R&D, by type of R&D: 1953–2018

(Percent)
Year Basic research Applied research Experimental development All R&D
1953 26.74 10.40 0.47 5.29
1954 29.08 9.94 0.46 5.35
1955 31.58 9.45 0.51 5.53
1956 30.64 7.57 0.43 4.60
1957 32.10 6.09 0.39 4.37
1958 33.09 5.51 0.39 4.50
1959 35.69 5.68 0.37 4.69
1960 37.71 6.07 0.37 5.14
1961 39.58 6.37 0.37 5.73
1962 40.41 5.84 0.40 6.35
1963 42.98 5.95 0.35 6.72
1964 44.70 6.09 0.39 7.20
1965 45.83 6.95 0.54 7.88
1966 47.10 7.54 0.60 8.24
1967 49.05 8.02 0.61 8.72
1968 49.79 7.88 0.63 8.87
1969 50.24 7.65 0.65 8.77
1970 51.61 7.84 0.66 9.20
1971 52.90 8.55 0.56 9.52
1972 52.94 10.07 0.54 9.59
1973 51.31 10.89 0.62 9.54
1974 50.59 10.81 0.66 9.64
1975 50.87 11.54 0.69 10.01
1976 49.79 11.61 0.73 9.89
1977 49.38 11.65 0.92 10.03
1978 48.51 11.65 1.20 10.25
1979 48.85 11.72 1.32 10.32
1980 49.33 11.81 1.27 10.21
1981 49.05 10.91 1.23 9.80
1982 47.80 10.51 1.15 9.42
1983 46.45 10.42 1.07 9.17
1984 46.09 10.39 1.02 8.95
1985 47.63 9.95 1.01 8.99
1986 46.30 10.21 1.08 9.60
1987 46.77 11.52 1.18 10.14
1988 47.22 12.80 1.30 10.62
1989 46.68 12.98 1.40 11.02
1990 48.31 12.63 1.50 11.14
1991 44.44 11.94 1.61 11.32
1992 46.77 12.87 1.60 11.73
1993 47.48 13.81 1.71 12.37
1994 48.57 14.72 1.76 12.77
1995 51.15 13.82 1.60 12.32
1996 48.91 13.63 1.48 12.02
1997 47.52 11.79 1.32 11.62
1998 54.22 11.05 1.09 11.33
1999 53.45 10.90 0.88 11.24
2000 53.03 11.26 0.75 11.16
2001 52.21 10.77 0.84 11.76
2002 54.23 15.18 0.83 13.20
2003 55.12 14.02 1.03 13.93
2004 57.20 12.89 1.21 14.30
2005 57.17 13.13 1.07 13.98
2006 58.38 12.43 0.89 13.50
2007 58.15 11.66 0.84 13.08
2008 57.08 14.30 0.76 12.86
2009 53.15 17.32 1.30 13.63
2010 50.59 18.41 1.95 14.29
2011 53.79 18.76 1.91 14.10
2012 53.89 18.05 2.00 14.04
2013 50.57 18.02 1.97 13.55
2014 48.65 17.64 1.96 13.10
2015 49.05 17.68 1.95 13.07
2016 47.37 17.56 1.97 12.99
2017 47.63 17.86 1.93 12.81
2018 46.46 17.97 1.81 12.36
Note(s):

The absolute numbers on which the percentages in this figure are based can be found in the original data source, linked to from the text. Before 2003, higher education R&D covered only S&E fields; in 2003 and later years, R&D in non-S&E fields is also included. In 1998 and later years, the higher education R&D data have been adjusted to eliminate double counting of R&D funds passed through from academic institutions to other academic and nonacademic (business, nonprofit, other) subrecipients.

Source(s):

National Center for Science and Engineering Statistics, National Patterns of R&D Resources.

Science and Engineering Indicators

The federal government provided more R&D funding to higher education than to any other sector, including federal intramural R&D (NCSES NP 2019: Table 6). In 2018, the higher education sector performed around 29% ($37.7 billion) of all federally funded R&D, a proportion that has generally increased over time (Figure URD-2; NCSES NP 2019: Table 6). Academic institutions performed around 58% ($24.3 billion) of federally funded basic research, 27% ($10.7 billion) of federally funded applied research, and 6% ($2.8 billion) of federally funded experimental development. The share of federally funded basic research performed by universities has remained relatively flat for the last 10 years, while the shares of applied research and of experimental development have increased.

Federally funded academic R&D as a percentage of U.S. federally funded R&D, by type of R&D: 1953–2018

(Percent)
Year Basic research Applied research Experimental development All R&D
1953 30.94 7.80 0.51 5.35
1954 33.33 7.64 0.44 5.32
1955 36.79 7.52 0.51 5.45
1956 36.48 6.34 0.39 4.44
1957 37.03 4.83 0.27 3.88
1958 37.62 4.41 0.26 4.01
1959 39.55 4.79 0.27 4.36
1960 42.95 5.37 0.30 5.08
1961 44.44 5.74 0.33 5.87
1962 44.83 5.67 0.34 6.78
1963 47.65 5.70 0.28 7.20
1964 48.67 5.77 0.35 7.79
1965 49.68 6.89 0.55 8.84
1966 51.37 7.92 0.64 9.42
1967 52.11 8.61 0.69 10.24
1968 52.73 8.89 0.74 10.60
1969 52.42 8.79 0.81 10.66
1970 52.90 9.03 0.90 11.25
1971 54.12 9.90 0.72 11.57
1972 54.10 12.06 0.62 11.78
1973 52.30 13.12 0.69 12.11
1974 51.14 13.13 0.71 12.49
1975 51.77 13.33 0.76 12.95
1976 50.73 13.35 0.83 12.91
1977 49.92 13.37 1.16 13.11
1978 48.46 13.31 1.77 13.64
1979 48.92 14.16 2.09 14.13
1980 49.80 14.59 2.06 14.46
1981 50.54 13.80 1.91 13.84
1982 48.80 13.10 1.78 13.14
1983 46.98 12.84 1.61 12.57
1984 47.24 12.91 1.54 12.37
1985 48.96 11.86 1.50 12.14
1986 50.12 13.38 1.51 12.87
1987 49.84 15.17 1.63 13.25
1988 49.08 18.22 1.87 14.29
1989 47.95 18.05 2.19 15.41
1990 49.01 15.63 2.69 16.13
1991 48.57 15.63 3.24 17.55
1992 51.29 17.64 3.35 18.92
1993 52.67 18.06 3.75 20.33
1994 54.50 19.16 4.02 21.38
1995 56.70 20.52 3.64 21.59
1996 55.87 20.52 3.60 22.22
1997 55.87 19.59 3.23 22.24
1998 56.50 17.17 2.89 22.30
1999 55.70 18.54 2.24 23.52
2000 55.44 19.94 1.98 25.42
2001 55.66 18.34 2.27 25.72
2002 56.86 20.42 2.15 27.46
2003 58.44 20.01 2.99 28.86
2004 60.72 20.89 3.54 29.32
2005 61.26 20.62 3.14 29.08
2006 61.22 20.43 2.40 28.29
2007 62.46 17.95 2.26 27.32
2008 63.91 21.52 1.54 25.20
2009 60.93 22.49 2.73 25.24
2010 58.92 29.22 4.26 27.39
2011 61.23 31.06 4.43 28.14
2012 61.15 30.04 4.69 28.24
2013 62.16 27.10 4.99 28.17
2014 59.49 25.82 5.29 27.98
2015 59.44 25.96 5.27 28.07
2016 59.07 27.06 5.97 29.67
2017 59.70 26.79 5.94 29.59
2018 58.44 26.81 5.78 29.12
Note(s):

The absolute numbers on which the percentages in this figure are based can be found in the original data source, linked to from the text. Before 2003, higher education R&D covered only S&E fields; in 2003 and later years, R&D in non-S&E fields is also included. In 1998 and later years, the higher education R&D data have been adjusted to eliminate double counting of R&D funds passed through from academic institutions to other academic and nonacademic (business, nonprofit, other) subrecipients.

Source(s):

National Center for Science and Engineering Statistics, National Patterns of R&D Resources.

Science and Engineering Indicators

Type of R&D Performed by Academic Institutions

In 2019, academic institutions performed $83.7 billion in R&D (NCSES HERD 2019: Table 1). Nearly two-thirds (63% in 2019, or around $52 billion) of the R&D performed by academic institutions was basic research, a percentage that has declined slightly in recent years (NCSES HERD 2019: Table 7). After a long period of increase from the 1980s through 2011, federal support for basic research at academic institutions declined over the last decade, although it has made up some of the loss since 2016 (Figure URD-3; note that the federal amounts in this figure from 2010 to 2014 include funds from the American Recovery and Reinvestment Act of 2009). Basic research support from nonfederal sources has increased steadily over time.

Federally funded and nonfederally funded higher education R&D expenditures, by type of R&D: FY 1980–2019

(Millions of constant 2012 dollars)
Fiscal year Federal: Basic research Federal: Applied research and experimental development Nonfederal: Basic research Nonfederal: Applied research and experimental development
1980 6,768.39 2,926.43 2,779.75 1,866.57
1981 7,045.60 2,833.37 2,883.08 2,035.88
1982 6,924.49 2,782.41 3,006.31 2,194.18
1983 6,946.73 2,824.13 3,439.09 2,226.79
1984 7,240.08 3,026.47 3,597.35 2,431.00
1985 7,958.59 3,155.58 4,055.34 2,582.00
1986 8,744.39 3,312.38 4,713.49 2,857.91
1987 9,421.56 3,449.61 5,290.10 3,141.10
1988 9,613.95 4,258.38 5,445.31 3,477.82
1989 10,094.51 4,557.60 5,862.80 3,892.78
1990 10,442.91 4,697.66 6,276.11 4,168.37
1991 10,829.54 4,725.01 6,804.92 4,363.42
1992 11,464.65 5,016.34 7,127.15 4,349.38
1993 12,185.14 5,168.31 7,116.95 4,482.01
1994 12,612.59 5,362.98 7,260.97 4,646.97
1995 13,077.78 5,479.34 7,531.65 4,771.11
1996 13,484.56 5,435.91 7,670.13 4,913.91
1997 13,856.28 5,380.79 8,443.25 5,066.49
1998 15,757.17 4,380.98 9,558.98 4,665.25
1999 16,689.80 4,406.18 10,087.73 4,882.81
2000 17,848.36 4,624.74 11,028.43 5,028.18
2001 18,846.97 5,248.78 11,723.27 5,290.14
2002 21,297.96 5,666.87 12,462.68 5,460.83
2003 23,773.01 6,208.82 12,691.38 5,870.88
2004 25,186.36 7,400.33 12,507.67 5,905.87
2005 26,178.22 7,208.88 13,118.28 5,855.64
2006 26,309.54 7,143.33 13,750.42 5,821.03
2007 25,949.83 6,951.02 14,839.44 5,773.60
2008 25,912.18 7,257.11 15,795.50 6,054.31
2009 26,342.11 7,948.42 16,724.21 6,735.79
2010 26,619.50 12,375.40 15,866.19 8,905.42
2011 28,061.56 13,487.57 16,047.70 8,927.84
2012 26,674.00 13,469.00 16,223.00 9,363.00
2013 25,804.83 12,958.92 17,226.81 9,863.40
2014 24,202.05 12,426.67 17,710.34 10,500.77
2015 23,997.32 12,177.40 18,244.12 11,104.00
2016 23,762.77 12,911.46 19,230.99 11,949.49
2017 23,955.99 13,387.80 19,545.07 12,866.96
2018 24,368.99 13,561.20 20,596.55 13,108.79
2019 25,387.49 14,212.54 21,166.93 13,610.37
Note(s):

The type-of-R&D estimation procedure was revised for FY 1998 and later years; hence, these data are not directly comparable with data for FY 1997 and earlier years. Before FY 2010, R&D expenditures by type of R&D were based on percentage estimates of basic research provided by universities and colleges. Beginning in FY 2010, institutions were asked for dollar amounts of federally funded and nonfederally funded R&D expenditures for basic research, applied research, and experimental development. For inflation adjustment, gross domestic product–implicit price deflators based on calendar year were used. Gross domestic product deflators come from the U.S. Bureau of Economic Analysis and are available at https://www.bea.gov/national (accessed August 2020). Federal figures include funds from the American Recovery and Reinvestment Act of 2009 (ARRA). ARRA was an important source of federal expenditures for academic R&D during the economic downturn and recovery from 2010 through 2012 and continued to contribute to such spending, although in smaller amounts, in 2013 and 2014. By 2015, all ARRA funds had been spent.

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Around a quarter of university R&D ($23.5 billion) was applied research and around a tenth ($7.7 billion) was experimental development (NCSES HERD 2019: Table 8). As percentages of overall academic R&D, applied research and experimental development have increased slightly since 2010. Both federal and nonfederal support for applied research and experimental development increased overall since 2010 (Figure URD-3).

Support for Academic R&D

Most academic R&D is funded by a few sources (Figure URD-4 and Figure URD-5). The federal government is by far the largest funder of academic R&D, although its share of total academic R&D has declined over time. Academic institutions themselves are the second-largest funder, and their share of total academic R&D has grown. Nonprofit organizations and businesses contribute small but slowly growing shares, while the share from state and local governments has declined.

Higher education R&D expenditures, by source of funds: FY 1972–2019

(Millions of constant 2012 dollars)
Fiscal year Federal government State and local government Institution funds Business All other sources
1972 7,554.71 1,136.36 1,283.67 311.45 787.04
1973 7,920.99 1,177.17 1,268.95 335.20 806.07
1974 7,437.77 1,123.72 1,354.32 351.39 797.95
1975 7,664.99 1,112.23 1,396.98 378.56 867.67
1976 7,977.14 1,155.92 1,416.32 390.60 905.05
1977 8,149.48 1,118.09 1,536.62 415.55 938.71
1978 8,544.69 1,156.42 1,740.22 474.86 1,002.79
1979 9,280.37 1,217.44 1,895.80 497.81 949.19
1980 9,694.82 1,161.58 1,975.40 558.32 953.39
1981 9,878.97 1,180.03 2,169.87 628.92 940.13
1982 9,704.86 1,253.82 2,261.35 685.94 999.39
1983 9,770.86 1,226.01 2,549.94 761.85 1,128.08
1984 10,266.54 1,304.35 2,667.30 897.92 1,158.79
1985 11,112.33 1,378.05 2,963.17 1,026.20 1,271.76
1986 12,056.76 1,643.61 3,357.28 1,257.41 1,314.89
1987 12,871.17 1,793.16 3,800.18 1,384.75 1,451.36
1988 13,872.33 1,872.67 3,989.16 1,476.46 1,583.14
1989 14,653.74 1,994.46 4,396.28 1,619.68 1,745.15
1990 15,140.57 2,079.47 4,721.22 1,770.06 1,870.58
1991 15,554.54 2,239.44 5,115.47 1,829.23 1,985.72
1992 16,480.99 2,214.80 5,270.35 1,899.88 2,092.99
1993 17,353.45 2,262.04 5,207.49 1,973.30 2,156.12
1994 17,976.99 2,209.12 5,438.27 2,021.59 2,237.53
1995 18,557.12 2,351.47 5,632.39 2,071.80 2,245.72
1996 18,921.84 2,476.09 5,701.01 2,194.59 2,212.35
1997 19,235.73 2,565.48 6,311.62 2,333.11 2,299.53
1998 20,136.82 2,583.69 6,647.18 2,509.30 2,485.39
1999 21,097.29 2,647.64 7,047.27 2,662.04 2,612.28
2000 22,474.39 2,817.62 7,588.37 2,761.27 2,888.06
2001 24,097.00 2,907.63 8,289.26 2,779.80 3,035.47
2002 26,966.07 3,089.45 8,800.74 2,703.27 3,328.81
2003 30,652.86 3,203.73 9,281.73 2,617.49 3,459.30
2004 33,385.23 3,395.85 9,143.67 2,511.21 3,362.82
2005 34,267.90 3,363.07 9,454.36 2,620.68 3,536.95
2006 34,316.64 3,292.99 10,061.06 2,665.70 3,550.57
2007 33,777.71 3,406.85 10,507.08 2,892.20 3,806.90
2008 34,048.58 3,646.58 11,007.64 3,043.06 4,153.59
2009 35,203.16 3,838.95 11,734.74 3,365.26 4,520.00
2010 36,202.14 4,044.32 12,426.39 3,331.60 4,970.35
2011 37,295.72 3,924.79 12,821.04 3,243.99 4,985.73
2012 37,781.26 3,744.00 13,625.00 3,279.00 5,007.00
2013 37,383.50 3,641.90 14,715.02 3,454.21 5,345.91
2014 36,174.65 3,778.46 15,226.75 3,602.86 5,682.17
2015 36,236.86 3,693.37 15,903.27 3,831.96 5,995.99
2016 36,738.55 3,821.42 16,976.92 3,988.84 6,464.25
2017 37,410.64 3,875.22 17,561.97 4,114.75 6,926.01
2018 37,996.37 3,908.43 18,362.65 4,280.15 7,224.84
2019 39,670.41 4,013.01 18,843.76 4,505.61 7,485.30
Note(s):

FY 1978 data are estimated based on data collected from doctorate-granting institutions only. Totals for FY 1972–2002 represent R&D expenditures in S&E fields only. From FY 2003 through FY 2009, some institution totals for all R&D expenditures may be lower-bound estimates because the National Center for Science and Engineering Statistics did not attempt to estimate for nonresponse on non-S&E R&D expenditure items before FY 2010. Source of fund detail data do not sum to total for FY 2003–09 because data by source were collected for S&E fields only. Total non-S&E expenditures were collected in a separate item. For inflation adjustment, gross domestic product–implicit price deflators based on calendar year were used. Gross domestic product deflators come from the U.S. Bureau of Economic Analysis and are available at https://www.bea.gov/national (accessed August 2020). Federal figures do not include funds from the American Recovery and Reinvestment Act of 2009 (ARRA). ARRA was an important source of federal expenditures for academic R&D during the economic downturn and recovery from 2010 through 2012 and continued to contribute to such spending, although in smaller amounts, in 2013 and 2014. By 2015, all ARRA funds had been spent. In this figure, the All other sources category includes nonprofits.

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Academic R&D expenditures, by source of support: FY 2019

(Billions of dollars)
Source of support Academic R&D expenditures
Federal government 44.5
Academic institutions 21.2
Nonprofit organizations 5.7
Business 5.1
State and local government 4.5
All other sources 2.7
Note(s):

Numbers may not add to totals in other figures because of rounding.

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Federal Support

The federal government is the largest funder of academic R&D and provided more than half (53%, or around $45 billion) of total funds in 2019 (Figure URD-5). When adjusted for inflation, federal funding for higher education R&D increased by 4.4% between 2018 and 2019 (Figure URD-6; NCSES HERD 2019: Table 1). After several years of declining funding levels during a period of global recession, federal funding for academic R&D increased by 9.5% between 2015 and 2019.

Federal funding for academic R&D expenditures: 2004–19

(Billions of constant 2012 dollars)
Year Federal funding (excluding ARRA) ARRA funding
2004 33.39 NA
2005 34.27 NA
2006 34.32 NA
2007 33.78 NA
2008 34.05 NA
2009 35.20 NA
2010 36.20 2.79
2011 37.30 4.25
2012 37.78 2.44
2013 37.38 1.44
2014 36.17 0.52
2015 36.24 NA
2016 36.74 NA
2017 37.41 NA
2018 38.00 NA
2019 39.67 NA

ARRA = American Recovery and Reinvestment Act of 2009.

Note(s):

ARRA was an important source of federal expenditures for academic R&D during the economic downturn and recovery from 2010 through 2012 and continued to contribute to such spending, although in smaller amounts, in 2013 and 2014. By 2015, all ARRA funds had been spent. For inflation adjustment, gross domestic product implicit–price deflators based on calendar year were used. Gross domestic product deflators come from the U.S. Bureau of Economic Analysis and are available at https://www.bea.gov/national (accessed August 2020).

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

In the federal government, six agencies provided more than 90% of support for academic R&D (Figure URD-7; NCSES HERD 2019: Table 13). The Department of Health and Human Services (HHS), largely through the National Institutes of Health (NIH), is by far the largest, providing more than half (55%, or $24.4 billion) of federal support in 2019. The Department of Defense (DOD) (15%, or $6.7 billion) and the National Science Foundation (NSF) (12%, or $5.3 billion) are next, followed by the Department of Energy (DOE) (4%, or $1.9 billion), the National Aeronautics and Space Administration (NASA) (4%, or $1.6 billion), and the Department of Agriculture (USDA) (3%, or $1.2 billion). The percentage of total federal academic R&D funding provided by each of these agencies has changed little over the last 10 years.

Federally financed academic R&D expenditures, by agency: FY 2019

(Billions of dollars)
Agency Academic R&D expenditures
HHS 24.4
DOD 6.7
NSF 5.3
DOE 1.9
NASA 1.6
USDA 1.2
Other agencies 3.3

DOD = Department of Defense; DOE = Department of Energy; HHS = Department of Health and Human Services; NASA = National Aeronautics and Space Administration; NSF = National Science Foundation; USDA = Department of Agriculture.

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Institutional Support

Institutional support, which is funding provided by academic institutions themselves, has represented an increasingly larger share of total academic R&D over time, although its share has changed little since 2016 (Figure URD-8: see NCSES HERD 2019: Table 2). Institutions provided more than $21 billion of academic R&D funding in 2019 (Figure URD-5), and institutional funds constituted a quarter of university R&D, up from a fifth in 2010. When adjusted for inflation, institutional funding for higher education R&D increased by more than 50% between 2010 and 2019. The increase over this period, while faster than in the past, continues a longer-term trend of a rising share of institutional funding; for comparison, institutions contributed 11%–12% of academic R&D funds in the early to mid-1970s. Precise accounting of institutionally financed R&D is difficult, and the trends described here represent increased institutional contributions to R&D as well as improved measurement of those contributions over time.

Nonfederal funding sources as a percentage of total academic R&D expenditures: 2010–19

(Percent)
Year Institutional funds Nonprofit organizations Business State and local government All other sources
2010 19.5 6.1 5.2 6.3 1.7
2011 19.3 5.9 4.9 5.9 1.6
2012 20.7 6.1 5.0 5.7 1.5
2013 22.3 5.8 5.2 5.5 2.3
2014 23.4 5.9 5.5 5.8 2.8
2015 24.2 6.2 5.8 5.6 3.0
2016 25.0 6.4 5.9 5.6 3.1
2017 25.1 6.8 5.9 5.5 3.1
2018 25.6 6.9 6.0 5.4 3.2
2019 25.3 6.8 6.0 5.4 3.2
Note(s):

Percentages are based on total academic R&D expenditures as reported in the Higher Education Research and Development Survey, which for 2010–14 include funds from the American Recovery and Reinvestment Act of 2009.

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Institutionally funded R&D expenditures include three main components: direct funding for R&D, cost sharing, and unrecovered indirect costs. Each has increased consistently since 2011, with the largest increase in direct funding for R&D (NCSES HERD 2019: Table 2; also see Gibbons 2019: Figure 2 for details of this trend). These institutional investments may cover many types of costs, including, for example, startup packages for new faculty (see AAMC 2015).

Institutionally financed research includes organized research projects fully supported with internal funding and all other separately accounted-for institutional funds for research. It does not include funds spent on research that are not separately accounted for, such as estimates of faculty time budgeted for instruction that is spent on research. Funds for institutionally financed R&D may derive from sources including general-purpose state or local government appropriations; general-purpose awards from industry, foundations, or other outside sources; endowment income; and gifts. Universities may also use income from patents and licenses or revenue from patient care to support R&D. For more on the topic of institutional funding sources, see Council on Governmental Relations (2019).

Other Sources of Support

Nonprofit Organizations

Nonprofit organizations provided $5.7 billion (about 7%) of academic R&D funding in 2019 (Figure URD-5). When adjusted for inflation, nonprofit funding for higher education R&D increased by about 31% between 2010 and 2019, representing a big rise from a small base (NCSES HERD 2019: Table 2).

Businesses (Industry)

Businesses provided $5.1 billion (around 6%) of academic R&D funding in 2019 (Figure URD-5). When adjusted for inflation, business funding for higher education R&D increased by about 35% between 2010 and 2019.

State and Local Governments

State and local governments provided $4.5 billion (around 5%) of academic R&D funding in 2019 (Figure URD-5). When adjusted for inflation, state and local government funding for higher education R&D in 2019 was within 1% of its level in 2010.

Other Sources

In 2019, all other sources of support—such as foreign businesses, other universities, or gifts designated for research—collectively accounted for $2.7 billion (3%) of academic R&D funding (Figure URD-5). About half ($1.3 billion) of these funds come from foreign sources. More detail on funding from foreign sources is available in NCSES HERD 2019: Table 14.

Performance of Academic R&D

Most academic R&D is performed by a small percentage of U.S. higher education institutions. Out of approximately 4,400 postsecondary degree-granting institutions in the United States (as reported in the forthcoming Indicators 2022 report "Higher Education in Science and Engineering"), fewer than 1,000 reported R&D expenditures in 2019. An even smaller number of universities, the doctoral universities with very high research activity, performed over three-quarters of all academic R&D. Public and private institutions showed different patterns of support, as did institutions with medical schools. When universities perform R&D and spend research dollars, that spending has an immediate economic impact. Aggregated data from a subset of universities show that research dollars support a wide range of businesses, including minority- or woman-owned and small businesses, in different states and industries (IRIS 2021).

Academic R&D at Research Universities

Academic R&D and doctoral training often occur at the same higher education institutions. The 131 doctoral universities with very high research activity, based on the Carnegie classification, performed 78% ($65.6 billion) of all U.S. academic R&D in 2019. These institutions also awarded around three-quarters of U.S. S&E doctoral degrees in 2019 (NCSES SED 2019: Table 11: see also the forthcoming Indicators 2022 report "Higher Education in Science and Engineering") and enrolled more than 80% of S&E doctoral students (NCSES GSS 2019: Table 5-3).

Even within this group of research-intensive universities, R&D activity was concentrated in relatively few institutions: the top 25 R&D performers among the very high research activity doctoral universities were responsible for nearly half ($30.3 billion, or 46%) of total R&D performed by this group of institutions and more than one-third of total academic R&D. The concentration of most R&D activity in a small number of institutions is a long-standing trend (see Indicators 2018: Figure 5-5 for illustration).

Academic R&D at Public and Private Institutions

Although only about a third of doctoral-granting institutions are public universities (Indicators 2020: Table 2-1), they performed two-thirds ($54.6 billion) of academic R&D in 2019 (NCSES HERD 2019: Table 69). Additionally, more public universities than private universities reported R&D expenditures. The top 25 public universities performed $25.1 billion in R&D, around 46% of the public university total (NCSES HERD 2019: Table 36). The concentration of R&D performance in a few institutions was greater in private universities: the top 25 performed $22.3 billion in R&D, more than three-quarters of the total performed by private universities (NCSES HERD 2019: Table 37).

The relative shares of funding sources differed between public and private institutions (Figure URD-9: see also NCSES HERD 2019: Table 69). Private universities received a higher proportion of their academic R&D funding from the federal government (nearly 60%) compared with public universities (50%). Public universities derived a higher percentage from their own institutional funds and from state and local governments.

Academic R&D expenditures, by institutional control and source of support: FY 2019

(Percent)
Institutional control Federal government Academic institutions Nonprofit organizations Business State and local government All other sources
Public 50.0 27.5 5.9 5.5 7.5 3.6
Private 59.3 21.1 8.5 7.1 1.4 2.6
Note(s):

"Institutional control" is a classification of whether an institution is operated by publicly elected or appointed officials (public control) or by privately elected or appointed officials and derives its major source of funds from private sources (private control).

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Public and private institutions also differed in the relative importance of particular federal agencies as funding sources (Figure URD-10: see also NCSES HERD 2019: Table 25). For example, private universities derived more than a third of their R&D funding from HHS, compared with about a quarter for public universities. Although USDA provided a relatively small amount of academic R&D funding, public universities, primarily land-grant universities, derived a much higher proportion of funds from this agency.

Federally financed academic R&D expenditures as a percentage of total academic R&D expenditures, by institutional control and agency: FY 2018

(Percent)
Institutional control HHS DOD NSF DOE NASA USDA All other agencies
Public 25.0 7.2 6.7 2.6 1.8 2.1 4.6
Private 37.3 9.3 5.7 1.8 2.2 0.3 2.6

DOD = Department of Defense; DOE = Department of Energy; HHS = Department of Health and Human Services; NASA = National Aeronautics and Space Administration; NSF = National Science Foundation; USDA = Department of Agriculture.

Note(s):

"Institutional control" is a classification of whether an institution is operated by publicly elected or appointed officials (public control) or by privately elected or appointed officials and derives its major source of funds from private sources (private control).

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Academic R&D at Institutions with Medical Schools

In 2019, 159 institutions with medical schools reported R&D expenditures (NCSES HERD 2019: Table 18 and Table 71). These institutions performed $60.6 billion of academic R&D, or 72% of total academic R&D. Roughly half of these expenditures ($30 billion) were associated with the medical schools themselves, whereas the other half were associated with other parts of these same institutions.

Institutions with medical schools received nearly $33.5 billion from the federal government (three-quarters of all federal funding for academic R&D), including $21.6 billion from HHS, or about 88% of the HHS total. The remainder of R&D funding for these institutions came from nonfederal sources and constituted more than two-thirds of nonfederal funding for academic R&D. Institutions with medical schools received more than half the funding from each federal agency except USDA and from each main type of nonfederal funding source (Figure URD-11).

Academic R&D expenditures at institutions with and without medical schools, by source of funding: FY 2019

(Billions of dollars)
Source Institutions with medical schools Institutions without medical schools
HHS 21.57 2.84
Academic institutions 14.86 6.25
Nonprofit organizations 4.45 1.23
DOD 4.31 2.34
Business 3.55 1.50
NSF 3.05 2.28
State and local government 2.28 2.21
DOE 1.19 0.75
NASA 0.93 0.71
USDA 0.60 0.62

DOD = Department of Defense; DOE = Department of Energy; HHS = Department of Health and Human Services; NASA = National Aeronautics and Space Administration; NSF = National Science Foundation; USDA = Department of Agriculture.

Note(s):

In FY 2019, HERD included 488 institutions without medical schools and 159 institutions with medical schools with expenditures over $1 million. This figure excludes other federal and nonfederal sources of funding.

Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Academic R&D at Minority-Serving Institutions

As discussed in the forthcoming Indicators 2022 report "Higher Education in Science and Engineering," minority-serving institutions (MSIs) include a diverse assemblage of more than 700 federally designated institutions of seven types (see also NASEM 2019). Historically Black colleges and universities (HBCUs) are one type of MSI defined by legislation. In 2019, the 49 HBCUs reporting expenditures in the NCSES Higher Education Research and Development (HERD) survey performed a total of around $500 million in academic R&D (NCSES HERD 2019: Table 31). The federal government provided around $370 million (about three-quarters) of this funding, a higher percentage than across institutions overall. The relative amounts of academic R&D performed across fields at HBCUs was very similar to that for all institutions (NCSES HERD 2019: Table 12 compared to Table 32).

High-Hispanic-enrollment institutions (HHE) are defined by the percentage of enrolled Hispanic or Latino students. In 2019, the 78 HHEs reporting expenditures in the HERD survey performed a total of around $6.4 billion in academic R&D (NCSES HERD 2019: Table 33). The federal government provided around $1.8 billion (about 40%) of this funding, a lower percentage than across institutions overall. The relative amounts of academic R&D performed across fields at HHEs was also similar to that for all institutions (NCSES HERD 2019: Table 12 compared to Table 34).

Academic R&D, by Field

The relative amount of resources provided to different fields has changed little since 2010 (NCSES HERD 2019: Table 9). The life sciences—primarily biological and biomedical sciences and health sciences—have long accounted for the bulk of academic R&D: $48.2 billion in 2019, more than half the total (58%). Life sciences plus engineering ($13.2 billion, or 16%) together constituted nearly three-quarters (74%) of academic R&D, with other fields each making up smaller shares of 7% or less. Consistent with the overall pattern, academic R&D funding across broad S&E fields (with the exception of the social sciences) came primarily from the federal government, with academic institutions themselves as the second-largest source (NCSES HERD 2019: Table 12). In the federal government, each federal agency funded a portfolio across fields that is consistent with its mission.

Federal Support for Academic R&D, by Field

The percentage of total academic R&D funding provided by the federal government varied across broad S&E fields, from around a third for social sciences (33%) to nearly 70% for computer and information sciences in 2019 (Figure URD-12: see also NCSES HERD 2019: Table 12). Although life sciences received the most resources, funding for academic R&D in this field was split nearly evenly between federal government and nonfederal sources.

Federal and nonfederal support for academic R&D, by field: FY 2019

(Percent)
Field Federal Nonfederal
All S&E fields 55 45
Computer and information sciences 68 32
Earth and physical sciences 66 33
Mathematics and statistics 61 39
Psychology 59 41
Engineering 58 42
Life sciences 53 47
Social sciences 33 67
Non-S&E fields 25 75
Source(s):

National Center for Science and Engineering Statistics, Higher Education Research and Development Survey (HERD).

Science and Engineering Indicators

Each of the six primary federal agencies that sponsor academic R&D funded a portfolio across fields consistent with its mission (Figure URD-13; NCSES HERD 2019: Table 13). For example, the vast majority ($21 billion, or nearly 90%) of the academic R&D funded by HHS was in life sciences. Around 85% ($1.6 billion) of DOE’s academic R&D funding was in earth and physical sciences and engineering. NSF supported substantial amounts of academic R&D across a range of S&E fields. Unsurprisingly, agencies’ academic R&D support patterns across S&E fields bear many similarities to their support patterns for graduate students and postdocs (see the section Education, Training, and Academic R&D).

Federally financed academic R&D expenditures, by agency and field: FY 2019

(Billions of dollars)
Agency Life sciences Engineering Earth and physical sciences Computer and information sciences Social sciences Psychology Mathematics and statistics Non-S&E fields
HHS 21.37 0.89 0.66 0.12 0.37 0.55 0.07 0.27
DOD 1.32 3.27 0.83 0.85 0.08 0.05 0.12 0.07
NSF 0.76 1.35 1.75 0.63 0.15 0.08 0.22 0.29
DOE 0.23 0.79 0.84 0.05 0.00 0.00 0.01 0.01
NASA 0.10 0.46 1.00 0.02 0.02 0.02 0.00 0.01
USDA 0.99 0.08 0.05 0.01 0.03<