U.S. Nonprofits Spent $28 Billion on R&D Activities in FY 2020

The largest funding source for nonprofit R&D performance was the federal government, contributing $12.3 billion, or 44%, of the total. Nonprofit organizations’ own internal funds were the next largest source at $6.0 billion, or 22%, of the total. For-profit businesses funded $3.1 billion (11%), and nonprofit foundations contributed an additional $2.3 billion (8%). The remaining sources each contributed less than 5% to total nonprofit R&D performance.^{​The remaining sources include state and local government funding, funding from individual donors, and all other sources not included in the named categories.The remaining sources include state and local government funding, funding from individual donors, and all other sources not included in the named categories.}

There was variation in the distribution of funding sources across the different types of nonprofits (figure 1). Science and technology organizations reported a much smaller proportion of internally funded R&D than healthcare organizations and other nonprofits. Science and technology organizations reported 14% ($1.4 billion) of their R&D performance was funded with their own dollars, whereas healthcare organizations reported 27% ($4.0 billion) and other nonprofits reported nearly a quarter ($554 million) of their respective R&D performance was funded internally. On the other hand, science and technology organizations reported a much larger proportion of R&D funded by the federal government ($6.1 billion or 59%) than healthcare organizations ($5.7 billion or 37%) or all other nonprofits ($461 million or 19%).

Historic estimates of nonprofit organization R&D from 1953–2020 and details about their creation are available in the National Patterns of R&D Resources: 2019–20 Data Update, available at https://ncses.nsf.gov/pubs/nsf22320.

Nonprofits reported that just under half (45%) of their FY 2020 R&D performance was categorized as basic research ($12.7 billion) and 39% ($10.8 billion) was applied research (table 2). The remaining 16% ($4.5 billion) was categorized as experimental development. These distributions remained stable regardless of whether the funding source was federal or nonfederal.

Similar to the higher education sector,^{​For higher education R&D expenditures by field, see table 3 in National Center for Science and Engineering Statistics (NCSES). 2021. Higher Education Research and Development: Fiscal Year 2020. NSF 22-311. Alexandria, VA: National Science Foundation. Available at https://ncses.nsf.gov/pubs/nsf22311.For higher education R&D expenditures by field, see table 3 in National Center for Science and Engineering Statistics (NCSES). 2021. Higher Education Research and Development: Fiscal Year 2020. NSF 22-311. Alexandria, VA: National Science Foundation. Available at https://ncses.nsf.gov/pubs/nsf22311.} nonprofit R&D is concentrated in the health and medical fields. The vast majority (75%, or $21 billion) of FY 2020 nonprofit R&D spending was in biological, biomedical, and health sciences (figure 2). Nonprofits also spent 7% ($1.9 billion) in psychology and social sciences. Another 6% of total R&D was reported in engineering in FY 2020 ($1.6 billion). The remaining fields accounted for nearly 13% ($3.5 billion).^{​See table 4 in the FY 2020 data tables at https://ncses.nsf.gov/pubs/nsf23317 for the full breakdown of R&D expenditures by field.See table 4 in the FY 2020 data tables at https://ncses.nsf.gov/pubs/nsf23317 for the full breakdown of R&D expenditures by field.}

An estimated total of 213,794 employees worked on R&D within U.S. nonprofit organizations in FY 2020, including 152,596 full-time equivalent (FTE) employees.^{​Employee numbers were reported both as total headcounts and as full-time equivalents (FTE). Headcounts represent every individual employed by the organization during FY 2020 regardless of their total hours worked. The FTE counts convert the headcounts to a total of full-time equivalent employees using the following calculation: 1 FTE equals 40 hours per week for 52 weeks per year. If an employee works 20 hours per week, they count as half of an FTE. See tables 8 and 9 in the FY 2020 data tables for more details on headcounts (https://ncses.nsf.gov/pubs/nsf23317).Employee numbers were reported both as total headcounts and as full-time equivalents (FTE). Headcounts represent every individual employed by the organization during FY 2020 regardless of their total hours worked. The FTE counts convert the headcounts to a total of full-time equivalent employees using the following calculation: 1 FTE equals 40 hours per week for 52 weeks per year. If an employee works 20 hours per week, they count as half of an FTE. See tables 8 and 9 in the FY 2020 data tables for more details on headcounts (https://ncses.nsf.gov/pubs/nsf23317).} Of this FTE total, 38% (58,657) were classified as researchers, 38% (57,510) were classified as technicians, and the remaining 24% (36,429)​ were other support personnel (figure 3). Healthcare organizations accounted for over half of the FTE totals and had a higher proportion of other support personnel (28% of their total) compared to science and technology and all other organizations (18% and 21%, respectively).

The NPRA FY 2020 module of the 2021 Annual Business Survey was conducted in 2021 with a sample of 8,000 nonprofit organizations representing 48,500 total eligible nonprofit organizations in the United States.^{​See the Technical Notes to the FY 2020 data tables at for details on the survey frame and exclusions (https://ncses.nsf.gov/pubs/nsf23317).See the Technical Notes to the FY 2020 data tables at for details on the survey frame and exclusions (https://ncses.nsf.gov/pubs/nsf23317).} Higher education institutions and nonprofit-administered federally funded research and development centers (FFRDCs) are not included in this survey, as these populations are already included in NCSES’s Higher Education R&D Survey and FFRDC R&D Survey. The fiscal year referred to throughout this report was the nonprofit organizations’ fiscal year; for the majority (62%) of organizations reporting R&D performance, this fiscal year ended in either September or December of 2020.

The response rate was 83%. The estimates in this InfoBrief are based on responses from a sample of the population and may differ from actual values because of sampling variability or other factors. As a result, apparent differences between the estimates for two or more groups may not be statistically significant. All comparative statements in this InfoBrief have undergone statistical testing and are significant at the 90% confidence level unless otherwise noted. The variances of estimates in this report were calculated using the successive difference replication method.

The full set of data tables for FY 2020 are available at https://ncses.nsf.gov/pubs/nsf23317. For more information, please contact the author.

Britt R; National Center for Science and Engineering Statistics (NCSES). 2022. U.S. Nonprofits Spent $28 Billion on R&D Activities in FY 2020. NSF 23-316. Alexandria, VA: National Science Foundation. Available at https://ncses.nsf.gov/pubs/nsf23316.

Ronda Britt
Survey Manager
NCSES
Tel: 703-292-7765
E-mail: rbritt@nsf.gov

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