by Ronda Britt[1]

Federal funding of higher education research and development increased in both current and constant dollars for the first time in 5 years, according to data from the Higher Education Research and Development (HERD) Survey by the National Center for Science and Engineering Statistics (NCSES) within the National Science Foundation (NSF). When adjusted for inflation, federal funding for higher education R&D increased by 1.4% between FY 2015 and FY 2016 (figure 1).

NOTES: Because of rounding, detail may not add to total. Includes all institutions surveyed in the fiscal years shown. Prior to FY 2003, totals did not include R&D expenditures in non-science and engineering fields.

SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, Higher Education Research and Development Survey.

Figure 1 Source Data: Excel file

Overall, universities reported current dollar R&D expenditures of $72.0 billion in FY 2016 (table 1), a 4.8% increase from the FY 2015 total of $68.6 billion. This total represents the reported totals of 902 degree-granting institutions that spent at least $150,000 in R&D in the previous fiscal year. The remainder of this InfoBrief will focus on the 640 institutions included in the full version of the HERD Survey (standard form) that reported at least $1 million in R&D during their previous fiscal year and that accounted for 99.8% of the total R&D expenditures reported for FY 2016. For more information, see "Data Sources, Limitations, and Availability."

R&D Expenditures, by Source of Funding

In current dollars, federally funded R&D at universities increased 2.5% to $38.8 billion in FY 2016 (table 2). However, the share of higher education R&D supported by the federal government continued to decline. Since FY 2011, federally funded expenditures have dropped from 62.5% to 54.0% of total R&D expenditures.

Universities reported increases in expenditures funded by all the major R&D funding agencies except NSF. Expenditures funded by the National Aeronautics and Space Administration and the Departments of Agriculture, Defense, Energy, and Health and Human Services increased between about 2% and 8% over FY 2015, while NSF-funded expenditures remained flat. Expenditures funded by other federal agencies declined almost 5% in FY 2016.

All of the nonfederal funding sources showed increases from FY 2015 to FY 2016, in total rising 7.6% to $33.0 billion in FY 2016. Expenditures funded by nonprofit organizations had the largest increase, up 9.4% to $4.6 billion. Nonfederal funding reported as all other sources—such as foreign governments, other universities, or gifts designated by the donors for research—also rose nearly 9% to $2.2 billion in FY 2016.

The universities' own funding of R&D continued to rise in FY 2016, increasing 8.2% from the FY 2015 total to reach nearly $18 billion. Continuing the trend of recent years, the bulk of this growth has been in the institutions' direct funding of R&D activities, which has risen 49.1% since FY 2012 to $11.5 billion in FY 2016 (figure 2). Cost sharing on sponsored projects has stayed roughly stable at $1.4 billion since FY 2013. Unrecovered indirect costs, or the amount of indirect costs that are not reimbursed to the institution for externally funded R&D, has risen more slowly over the past 4 years, with a 4.7% increase between FY 2015 and FY 2016. Unrecovered indirect costs now total over $5 billion, or 7% of all R&D expenditures within the higher education sector.

SOURCE: National Science Foundation, National Center for Science and Engineering Statistics, Higher Education Research and Development Survey.

Figure 2 Source Data: Excel file

R&D Expenditures, by Field

Higher education R&D has long been heavily concentrated in three fields, which together accounted for 65.2% of the total spent in FY 2016: health sciences ($22.4 billion), biological and biomedical sciences ($13.0 billion), and engineering ($11.4 billion) (table 3). Among the broad fields, R&D expenditures within non-science and engineering fields saw the largest growth in FY 2016, increasing 14.9% to $4.1 billion.

Substantive changes were made to the field list and classification structure for the FY 2016 survey to modernize the list and harmonize the categories with other NCSES surveys. Several fields were renamed, such as medical sciences to health sciences, and some disciplines were moved to different subfields to achieve comparability across surveys. In particular, many of the disciplines listed under life sciences, not elsewhere classified (nec) were moved to health sciences. This is reflected in the 36.4% decline in life sciences, nec, for FY 2016. In addition, four new subfields were added: natural resources and conservation under life sciences, materials science under physical sciences, anthropology under social sciences, and industrial and manufacturing engineering under engineering. These changes primarily affect trends in the revised subfields and do not significantly affect the broad field trends. For complete details on the changes, see Technical Notes, Appendix A in the full set of data tables (https://ncsesdata.nsf.gov/herd/2016/).

Top University Research Performers

There remains remarkable stability in the year-to-year composition of the largest university R&D performers. Relative to FY 2015, there was only one institution change within the top 30 institutions in R&D spending in FY 2016 (table 4). New York University rose 12 spots from number 35 in FY 2015 to number 23 in FY 2016, with a 34% increase to $810 million. This increase was driven by a newfound ability to capture and report all institution funding of R&D within their medical school, as well as increased R&D expenditures at their Abu Dhabi campus. The University of Texas, Austin, which had ranked at number 30 in FY 2015, fell to number 34 in FY 2016 with $622 million in R&D expenditures. The University of Pennsylvania also rose substantially in the ranks, from number 17 in FY 2015 to number 3 in FY 2016. Their 50% increase in one year was also due to new reporting of institution funding of R&D within their medical school.

The number of universities reporting over $1 billion in R&D spending has increased from 1 institution in FY 2007 to 12 institutions in FY 2016. Combined, the top 30 institutions accounted for 42.0% of the total spent on R&D within the higher education sector in FY 2016.

Data Sources, Limitations, and Availability

The fiscal year referred to throughout this report is the academic fiscal year. For most institutions, FY 2016 represents 1 July 2015 through 30 June 2016. The higher education R&D expenditures data were collected from a census of 902 universities and colleges that grant a bachelor's degree or higher and expended at least $150,000 in R&D in FY 2016. To reduce respondent burden, the HERD Survey was revised beginning in FY 2012 to request abbreviated data from institutions reporting less than $1 million in R&D expenditures during the previous fiscal year. Except for figure 1 and table 1, the totals shown in this InfoBrief do not include expenditures reported by 262 institutions that completed a short-form version of the survey in FY 2016. These institutions accounted for $138 million (0.2%) of total higher education R&D expenditures in FY 2016.

The amounts reported include all funds expended for activities specifically organized to produce research outcomes and sponsored by an outside organization or separately accounted for using institution funds. R&D expenditures at university-administered federally funded research and development centers (FFRDCs) are collected in a separate survey, the FFRDC R&D Survey, and these data are available at https://www.nsf.gov/statistics/ffrdc/.

The full set of data tables from this survey is available at https://ncsesdata.nsf.gov/herd/2016/.

Note

[1] Ronda Britt, Research and Development Statistics Program, National Center for Science and Engineering Statistics, National Science Foundation, 2415 Eisenhower Avenue, Suite W14200, Alexandria, VA 22314 (rbritt@nsf.gov; 703-292-7765).