by Raymond M. Wolfe[1]

Companies spent $302 billion on research and development performed in the United States during 2012, 2.8% more than the $294 billion spent during 2011 (table 1). Funding from the companies’ own sources was $239 billion during 2011 and $247 billion during 2012, a 3.6% increase; funding from other sources was $55 billion in both years (table 1). Data for this InfoBrief are from the Business R&D and Innovation Survey (BRDIS), which was developed and cosponsored by the National Science Foundation and the U.S. Census Bureau.

TABLE 1. Funds spent for business R&D performed in the United States, by source of funds and size of company: 2011–12
(Millions of U.S. dollars)

i = more than 50% of value imputed.

a For companies located in the United States that performed or funded R&D.
b Includes companies located inside and outside the United States, U.S. state government agencies and laboratories, foreign government agencies and laboratories, and all other organizations located inside and outside the United States.

NOTES: Detail may not add to total because of rounding. Excludes data for federally funded research and development centers. The Business R&D and Innovation Survey does not include companies with fewer than five employees.

SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, Business R&D and Innovation Survey.

Table 1 Source Data: Excel file

Selected characteristic 2011 2012
Domestic R&D performancea 294,093 302,250
Source of funds
Paid for by the company 238,768 247,280
Paid for by others 55,324 54,970
Federal 31,309 i 30,621 i
Otherb 24,015 24,349
Size of company (number of domestic employees)
5–24 10,981 9,841
25–49 10,861 7,195
50–99 9,468 9,182
100–249 12,528 12,480
250–499 12,955 11,264
500–999 10,027 11,484
1,000–4,999 50,485 50,691
5,000–9,999 24,951 30,483
10,000–24,999 49,214 49,493
25,000 or more 102,623 110,138

R&D Performance, by Industrial Sector and Source of Funding

During 2012, companies in manufacturing industries performed $208 billion (69%) of domestic R&D, defined as R&D performed in the 50 states and Washington, D.C. (table 2). Most of the funding was from companies’ own funds (82%). Companies in nonmanufacturing industries performed $94 billion of domestic R&D (31% of total domestic R&D performance), 82% of which was paid for from companies’ own funds. The U.S. federal government was the chief source of outside funding (also referred to as R&D paid for by others) for R&D across all industries. Of the $55 billion paid for by others, the federal government contributed $31 billion, most of which came from the Department of Defense ($25 billion) (data not shown). Aerospace products and parts (North American Industry Classification System [NAICS] code 3364), professional, scientific, and technical services (NAICS 54), and computer and electronic products (NAICS 334) received 89% of federal government R&D funding. Next among outside funders were foreign companies ($12 billion), including foreign parent companies of U.S. subsidiaries, and other U.S. companies ($11 billion) (table 2) (see “Survey Information and Data Availability” for information on industry classification).

TABLE 2. Funds spent for business R&D performed in the United States, by source of funds and selected industry: 2011 and 2012
(Millions of U.S. dollars)

D = suppressed to avoid disclosure of confidential information; i = more than 50% of value imputed.

NAICS = North American Industry Classification System; nec = not elsewhere classified.

a Includes foreign parent companies of U.S. subsidiaries.
b Includes U.S. state government agencies and laboratories, foreign agencies and laboratories, and all other organizations located inside and outside the United States.
c Includes companies located in the United States that performed or funded R&D.

NOTES: Detail may not add to total because of rounding. Industry classification was based on dominant business code for domestic R&D performance, where available. For companies that did not report business codes, the classification used for sampling was assigned. Excludes data for federally funded research and development centers.

SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, Business R&D and Innovation Survey.

Table 2 Source Data: Excel file

Paid for by others
Industry and NAICS code All R&D Paid for by the company Total Federal Companies All other organizationsb
Domestic Foreigna
2011
All industries, 21–33, 42–81c 294,093 238,768 55,324 31,309 i 11,124 12,007 884
Manufacturing industries, 31–33 201,361 163,340 38,021 24,698 i 4,196 8,870 257
Chemicals, 325 55,324 49,988 5,337 110 1,320 3,867 40
Pharmaceuticals and medicines, 3254 45,949 41,111 4,838 52 1,285 3,474 27
Other 325 9,375 8,877 499 58 35 393 13
Machinery, 333 14,709 13,578 1,131 522 423 D D
Computer and electronic products, 334 62,704 53,664 9,040 5,161 1,087 2,726 66
Electrical equipment, appliance, and components, 335 3,595 3,417 178 76 24 74 4
Transportation equipment, 336 40,880 20,275 20,605 i D 1,086 D D
Automobiles, trailers, and parts, 3361–63 D 11,737 D D D D D
Aerospace products and parts, 3364 26,054 7,585 18,469 i 17,806 i 592 D D
Other 336 D D D D D D D
Manufacturing nec, other 31–33 24,149 22,418 1,730 D 256 D D
Nonmanufacturing industries, 21–23, 42–81 92,731 75,428 17,303 6,611 6,928 3,138 626
Information, 51 41,865 41,014 851 D 321 D D
Software publishers, 5112 27,965 27,280 685 136 D D D
Other 51 13,900 13,734 166 D D D D
Finance and insurance, 52 3,457 3,310 146 0 145 1 0
Professional, scientific, and technical services, 54 38,219 23,368 14,851 5,848 6,227 2,213 563
Computer systems design and related services, 5415 13,259 11,706 1,553 598 626 209 120
Scientific R&D services, 5417 15,301 6,170 9,131 3,226 3,834 1,833 238
Other 54 9,659 5,492 4,167 2,024 1,767 171 205
Nonmanufacturing nec, other 21–23, 42–81 9,190 7,736 1,455 D 235 D D
2012
All industries, 21–33, 42–81c 302,250 247,280 54,970 30,621 i 11,624 12,093 632
Manufacturing industries, 31–33 208,415 170,197 38,218 24,059 i 4,553 9,320 286
Chemicals, 325 57,225 50,867 6,359 369 i 1,374 4,605 11
Pharmaceuticals and medicines, 3254 48,146 42,594 5,552 57 1,337 4,153 5
Other 325 9,079 8,273 807 312 37 452 6
Machinery, 333 14,254 13,294 960 385 278 192 105
Computer and electronic products, 334 65,068 56,677 8,391 4,852 1,248 2,167 124
Electrical equipment, appliance, and components, 335 3,087 2,900 187 44 i 10 i 132 1
Transportation equipment, 336 42,305 21,344 20,961 i 18,268 i 1,312 1,359 22
Automobiles, trailers, and parts, 3361–63 D 13,191 D D 558 i D D
Aerospace products and parts, 3364 24,817 7,140 17,677 i 16,895 i 749 D D
Other 336 D 1,013 D D 5 D D
Manufacturing nec, other 31–33 26,476 25,115 1,360 141 331 865 23
Nonmanufacturing industries, 21–23, 42–81 93,835 77,083 16,752 6,562 7,071 2,773 346
Information, 51 46,805 45,851 954 142 351 419 42
Software publishers, 5112 28,745 28,012 733 103 256 367 7
Other 51 18,060 17,839 221 39 95 52 35
Finance and insurance, 52 3,519 3,507 12 0 11 2 0
Professional, scientific, and technical services, 54 34,309 20,166 14,143 5,606 6,333 1,947 257
Computer systems design and related services, 5415 11,251 i 9,163 i 2,088 1,449 435 i 180 24
Scientific R&D services, 5417 16,544 6,788 9,756 2,596 5,512 1,540 108
Other 54 6,514 4,215 2,299 1,561 386 227 125
Nonmanufacturing nec, other 21–23, 42–81 9,202 7,559 1,643 814 376 405 48

Sales, R&D Intensity, and Employment of R&D Performers

U.S. companies that performed or funded R&D reported domestic net sales of $9 trillion in 2012 (table 3).[2] For all industries, the R&D intensity (ratio of domestic R&D performance to domestic net sales) was 3.3%; for manufacturers, 3.8%; and for nonmanufacturers, 2.5%. Manufacturing industries with high levels of R&D intensity in 2012 were pharmaceuticals and medicines (NAICS 3254) (12.7%), aerospace products and parts (NAICS 3364) (10.1%), and computer and electronic products (NAICS 334) (9.8%). Among the nonmanufacturing industries, industries with high levels of R&D intensity were scientific R&D services (NAICS 5417) (23.2%), software publishers (NAICS 5112) (9.9%), and computer systems design and related services (NAICS 5415) (9.3%).

TABLE 3. Sales and employment for companies that performed or funded business R&D, by selected industry and company size: 2012

D = suppressed to avoid disclosure of confidential information; i = more than 50% of value imputed.

NAICS = North American Industry Classification System; nec = not elsewhere classified.

a Includes domestic net sales of companies that perform or fund R&D, transfers to foreign subsidiaries, and export sales to foreign companies; excludes intracompany transfers and sales by foreign subsidiaries.
b R&D intensity is domestic R&D paid for by the company and others and performed by the company divided by domestic net sales.
c Data recorded on 12 March represent employment figures for the year.
d Includes scientists and engineers and their managers and also technicians, technologists, and support staff.
e Includes companies located in the United States that performed or funded R&D.

NOTES: Detail may not add to total because of rounding. Industry classification was based on dominant business code for domestic R&D performance, where available. For companies that did not report business codes, classification used for sampling was assigned. Excludes data for federally funded research and development centers. The Business R&D and Innovation Survey does not include companies with fewer than five employees.

SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, Business R&D and Innovation Survey, 2012.

Table 3 Source Data: Excel file

Industry and NAICS code Domestic net sales (US$millions)a R&D intensity (%)b Domestic employment (thousands)c
Total R&Dd
All industries, 21–33, 42–81e 9,233,431 3.3 18,294 1,469
Manufacturing industries, 31–33 5,529,851 3.8 9,988 886
Chemicals, 325 1,345,922 4.3 1,473 162
Pharmaceuticals and medicines, 3254 380,151 12.7 539 114
Other 325 965,771 0.9 934 48
Machinery, 333 388,468 3.7 922 89
Computer and electronic products, 334 661,029 9.8 1,439 267
Electrical equipment, appliance, and components, 335 111,858 2.8 325 25
Transportation equipment, 336 910,357 4.6 1,611 147
Automobiles, trailers, and parts, 3361–63 598,284 D 794 64
Aerospace products and parts, 3364 246,598 10.1 615 73
Other 336 65,475 D 202 10
Manufacturing nec, other 31–33 2,112,217 1.3 4,218 196
Nonmanufacturing industries, 21–23, 42–81 3,703,580 2.5 8,306 583
Information, 51 1,054,016 4.4 2,050 225
Software publishers, 5112 291,711 9.9 470 146
Other 51 762,305 2.4 1,580 79
Finance and insurance, 52 939,993 0.4 1,323 26
Professional, scientific, and technical services, 54 341,527 10.0 1,269 248
Computer systems design and related services, 5415 120,944 9.3 i 509 101
Scientific R&D services, 5417 71,332 23.2 208 75
Other 54 149,251 4.4 552 72
Nonmanufacturing nec, other 21–23, 42–81 1,368,044 0.7 3,664 84
Size of company (number of domestic employees)
5–24 134,492 7.3 472 111
25–49 146,110 4.9 455 70
50–99 154,149 6.0 542 77
100–249 352,975 3.5 993 101
250–499 271,839 4.1 738 79
500–999 330,036 3.5 755 67
1,000–4,999 1,231,026 4.1 2,583 226
5,000–9,999 1,176,198 2.6 1,557 138
10,000–24,999 1,742,153 2.8 2,590 198
25,000 or more 3,694,455 3.0 7,608 401

Businesses that performed or funded R&D employed 18.3 million people in the United States during 2012. Some 1.5 million (8.0%) were R&D employees.[3] Not surprisingly, industries with high levels of R&D intensity also had high numbers of R&D employees in 2012: computer and electronic products (NAICS 334) (267,000 R&D employees), pharmaceuticals and medicines (NAICS 3254) (114,000), and aerospace products and parts (NAICS 3364) (73,000). Nonmanufacturing industries with high numbers of R&D employees were software publishers (NAICS 5112) (146,000), computer systems design and related services (NAICS 5415) (101,000), and scientific R&D services (NAICS 5417) (75,000) (table 3).

R&D Performance, by Company Size

Small companies (from 5 to 499 domestic employees) performed 17% of the nation’s total business R&D in 2012 (table 1). In these companies, the R&D intensity was 4.7%, compared with 3.1% for all other companies (tables 1 and 3). Small companies accounted for 11% of sales and employed 17% of 18.3 million who worked for R&D-performing or R&D-funding companies. Of the 1.5 million R&D employees engaged in business R&D in the United States, 30% worked for small companies. By contrast, mid-size companies (from 500 to 24,999 domestic employees) performed 47% of the nation’s total business R&D in 2012, and their R&D intensity was 3.2%. They accounted for 49% of sales and employed 41% of those who worked for R&D-performing or R&D-funding companies, including 43% of R&D employees in the United States. The largest companies (25,000 or more domestic employees) performed 36% of the nation’s total business R&D in 2012, and their R&D intensity was 3.0%. The largest companies employed 42% of those who worked for R&D-performing or R&D-funding companies, including 27% of R&D employees in the United States.

R&D Performance, by State

Business R&D is concentrated in a relatively small number of states. During 2012, companies reported $247 billion of domestic R&D paid for by the company. Businesses in California alone accounted for 28.1% of this amount in 2012 (table 4). Other states with large amounts of company-funded business R&D, as reflected by the percentages of the national total they accounted for in 2012, were Illinois (4.8%), Massachusetts (5.7%), Michigan (5.4%), New Jersey (5.6%), New York (3.6%), Pennsylvania (3.5%), Texas (5.2%), and Washington (5.5%).

TABLE 4. Funds spent for business R&D performed in the United States, by source of funds and state: 2012
(Millions of U.S. dollars)

e = more than 50% of the cell value is imputed due to raking of state data; i = more than 50% of value is imputed due to reasons other than ranking of state data.

a Includes companies located in the United States that performed or funded R&D.
b Includes data reported on Form BRDI-1 not allocated to a specific state. Data reported on Form BRD-1(S), the questionnaire sent to small companies or companies new to the survey, were allocated to the state in the address on the company's survey form, which is usually the company's headquarters.

NOTES: Detail may not add to totals because of rounding. Excludes data for federally funded research and development centers.

SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, Business R&D and Innovation Survey, 2012.

Table 4 Source Data: Excel file

State All R&D Paid for by the company Paid for by others
United Statesa 302,250 247,280 54,970
Alabama 1,284 779 505
Alaska 39 e 23 e 16 e
Arizona 4,962 3,864 1,098
Arkansas 305 275 30
California 81,689 69,493 12,196
Colorado 4,105 3,462 643
Connecticut 7,343 5,527 1,815
Delaware 2,415 1,866 549
District of Columbia 260 153 i 107
Florida 5,211 3,353 1,858 i
Georgia 3,875 3,295 580 i
Hawaii 188 130 58
Idaho 1,079 833 246
Illinois 13,001 11,769 1,232
Indiana 6,044 5,223 821
Iowa 1,763 1,186 577
Kansas 2,072 1,446 626
Kentucky 1,074 772 302
Louisiana 363 i 282 80 i
Maine 275 236 39
Maryland 4,028 1,929 2,099
Massachusetts 17,491 14,157 3,334
Michigan 14,912 13,460 1,452
Minnesota 6,216 5,616 600
Mississippi 273 219 54
Missouri 6,982 i 3,282 3,700 i
Montana 105 i 81 24 i
Nebraska 578 539 39
Nevada 634 552 83
New Hampshire 1,857 796 1,060
New Jersey 15,810 13,854 1,956
New Mexico 445 242 203
New York 11,732 8,831 2,900 i
North Carolina 6,254 5,143 1,111
North Dakota 222 202 20
Ohio 7,755 5,402 2,353 i
Oklahoma 463 406 57 i
Oregon 5,156 i 4,873 i 282
Pennsylvania 9,318 8,683 635
Rhode Island 450 408 42
South Carolina 1,615 1,206 409 i
South Dakota 112 94 18
Tennessee 1,437 1,118 320
Texas 15,163 12,859 2,305 i
Utah 2,134 1,546 588 i
Vermont 466 i 425 i 41
Virginia 4,756 2,356 2,400 i
Washington 14,494 13,678 815 i
West Virginia 305 257 48
Wisconsin 4,135 3,654 481
Wyoming 30 e 23 e 7 e
Undistributed fundsb 9,580 7,423 2,157

Survey Information and Data Availability

The sample for BRDIS was selected to represent all for-profit, nonfarm companies that are publicly or privately held and have five or more employees in the United States. Estimates produced from the survey and presented in this InfoBrief are restricted to companies that perform or fund R&D, either domestically or abroad. Because the statistics from the survey are based on a sample, they are subject to both sampling and nonsampling errors (see technical notes in the detailed statistical tables at http://www.nsf.gov/statistics/industry/).

In this InfoBrief, money amounts are expressed in current U.S. dollars and are not adjusted for inflation. Company is defined as a business organization located in the United States, either U.S. owned or a U.S. affiliate of a foreign parent, of one or more establishments under common ownership or control that performs or funds R&D.

For 2011, a total of 43,108 companies were sampled, representing 1,964,799 companies; for 2012, a total of 43,655 companies were sampled, representing 1,971,731 companies. The actual numbers of companies in the sample that remained within the scope of the survey between sample selection and tabulation were 39,624 for 2011 and 39,744 for 2012. These lower counts represent the number of companies that were determined to be within the scope of the survey after all data collected were processed. Reasons for the reduced counts include mergers, acquisitions, and instances where companies had gone out of business in the interim. Of these in-scope companies, 71.5% were considered to have met the criteria for a complete response to the 2011 survey; 77.1% met the 2012 survey response criteria. Industry classification was based on the dominant business activity for domestic R&D performance, where available. For reporting units that did not report business activity codes for R&D, the classification used for sampling was assigned.

The full set of detailed tables from this survey will be available in the report Business R&D and Innovation: 2012 (http://www.nsf.gov/statistics/industry/). Individual detailed tables and tables with relative standard errors and imputation rates from the 2012 survey may be available in advance of the full report. For further information, contact Raymond M. Wolfe.

Notes

[1] Raymond M. Wolfe, Research and Development Statistics Program, National Center for Science and Engineering Statistics, National Science Foundation, 4201 Wilson Boulevard, Suite 965, Arlington, VA 22230 (rwolfe@nsf.gov; 703-292-7789).

[2] Determining the amount of domestic net sales and operating revenues was left to the reporting company; however, guidance was given to exclude intracompany transfers and sales by foreign subsidiaries but to include transfers to foreign subsidiaries and export sales to foreign companies.

[3] Employment statistics in this InfoBrief are head counts. Full-time equivalent statistics are available in the detailed statistical tables. R&D employees include scientists and engineers, their managers, and the technicians, technologists, and support staff members who work on R&D or who provide direct support to R&D activities.