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News Release 98-034

Upswing in Industrial R&D Creating Positive Economic Benefits

New Data Released in S&E Indicators

July 1, 1998

This material is available primarily for archival purposes. Telephone numbers or other contact information may be out of date; please see current contact information at media contacts.

Increases in industrial research and development (R&D) activities are the highest recorded since the early 1980s, according to a new National Science Board (NSB) report to Congress.

The importance of public research to industry is also stronger today than ever, as reported in the newest edition of Science and Engineering Indicators 1998.

According to the 800-page report, the rise in industrial R&D investments is due to intense international competition, the introduction of information technology (IT) and record profits. It also attributes a direct benefit to the economy from both publicly and privately funded research.

The volume says that U.S. industry has turned a corner in the last few years, increasing investments in its own research laboratories while at the same time accelerating connections to universities and colleges for fundamental and applied research.

Patents granted to U.S. inventors and those from a number of key industrialized nations have increasingly cited public research at academic and nonprofit institutions, and government research facilities. And, American inventors more frequently than ever cite articles in research journals written overwhelmingly by U.S. authors.

"These results are striking," said Neal Lane, outgoing director of the National Science Foundation. "We see a documented, direct connection between new knowledge and economic growth. Scientific research, especially that based at universities, is proving to be a major contributor to industrial innovation."

Meanwhile, the report cautions that the recent trends in rising industrial R&D combined with a receding federal government share of investments is slowly shifting the direction of the nation's R&D enterprise. While the health of R&D funding overall remains positive, "there is cause for concern that short-term R&D may be displacing the longer-term quest for new knowledge and breakthrough discoveries," says the book's U.S./international R&D chapter summary.

Other highlights in S&E Indicators 1998 include:

  • Cooperative R&D in the form of new joint research ventures between firms has been growing, with the largest increases occurring in 1995 and 1996.

  • Growing global cooperation is increasing as industrial firms are using global research partnerships. Since 1986, over 4,000 known multi-firm alliances have been formed to develop and share information technologies.

  • Information technologies have moved economic markets and business behavior far closer to "real-time" mode than has ever existed in the past.

NSB is the governing body for the National Science Foundation, which develops S&E Indicators for NSB through the Division of Science Resources Studies. The final report is submitted to the President, who transmits it to Congress.


The URL for the web version of Science and Engineering Indicators 1998 is:

For other press releases about S&E Indicators, see:

  • PR 98-35 Growth of Information Technology is Changing the Face of the Economy: S&E Indicators '98 says IT likened in scope to Industrial Revolution

  • PR 98-36 Science and Engineering Indicators '98 Survey Shows Americans' Interest in Science Grows: But actual understanding of scientific terms and concepts still lags

Media Contacts
William C. Noxon, NSF, (703) 292-8070, email:

Program Contacts
Jennifer Bond, NSF, (703) 292-8777, email:

The National Science Foundation (NSF) is an independent federal agency that supports fundamental research and education across all fields of science and engineering. In fiscal year (FY) 2018, its budget is $7.8 billion. NSF funds reach all 50 states through grants to nearly 2,000 colleges, universities and other institutions. Each year, NSF receives more than 50,000 competitive proposals for funding and makes about 12,000 new funding awards.

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