U.S. Research and Development Funding and
Performance: Fact Sheet
Updated October 4, 2021
Congressional Research Service
https://crsreports.congress.gov
R44307

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U.S. Research and Development Funding and Performance: Fact Sheet

esearch and development (R&D) in the United States is funded and performed by a
number of sectors—including the federal government, state governments, businesses,
R academia, and nonprofit organizations—for a variety of purposes. This fact sheet begins
by providing a profile of the U.S. R&D enterprise, including historical trends and current funding
by sector and by whether the R&D is basic research, applied research, or development. The final
section of this fact sheet includes data on R&D performance by sector.
Historical Trends in U.S. R&D Funding
The United States became a global leader in R&D in the 20th century, funding as much as 69% of
annual global R&D in the period following World War II.1 Figure 1 shows the growth in total
U.S. R&D expenditures from 1955 to 2019 in current dollars.2 U.S. R&D in 2019 was 105 times
higher than it was in 1955 in current dollars, and more than 13 times higher in constant dollars.3
By sector, business-funded R&D grew the most during this period. However, faster growth in
total R&D spending of other nations reduced the U.S. share of global R&D to approximately
29.9% in 2019.4
Figure 1. U.S. R&D Expenditures by Source of Funding, 1955-2019
Current dol ars, in bil ions

Source: CRS analysis of National Science Foundation, National Patterns of R&D Resources: 2018–19 Data Update,
NSF 21-325, Table 6, April 9, 2021, https://ncses.nsf.gov/pubs/nsf21325.
Notes: 2019 data are preliminary and may be revised.
Two sectors—business and the federal government—have together accounted for more than 90%
of U.S. R&D funding since 1955, though their combined share has fal en from a high of 98% in
1956 to 91% in 2016. Federal R&D expenditures as a share of total U.S. R&D expenditures
peaked in 1964 at 66.8%, the same year that business R&D expenditures reached a nadir of
30.8%. Between 1964 and 2000, the federal government’s share fel and business’s share rose. In
2000, business accounted for 69.4% of U.S. R&D expenditures and the federal government
25.1%. This shift in the composition of R&D funding resulted not from a reduction in federal

1 Office of T echnology Policy, U.S. Department of Commerce, The Global Context for U.S. Technology Policy, 1997.
2 Data for all years in this report are for fiscal years unless otherwise specified.
3 2019 is the latest year for which total U.S. R&D data are available.
4 Organisation for Economic Co-operation and Development, OECD.Stat, Main Science and Technology Indicators,
database, https://stats.oecd.org/Index.aspx?DataSetCode=MST I_PUB. 2017 is the latest year for which complete data
is available. For more information about global R&D, see CRS Report R44283, Global Research and Developm ent
Expenditures: Fact Sheet, by John F. Sargent Jr.
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U.S. Research and Development Funding and Performance: Fact Sheet

government R&D expenditures, but rather from faster growth in business R&D expenditures.
From 2000 to 2010, business R&D’s share declined from 69.4% to 61.0%, and has risen each
year since, reaching an al -time high of 70.7% in 2019; from 2010 to 2019, the federal share
declined from 31.1% to 21.2%.5 (See Figure 2.)
Trends in Federally Funded R&D
In current dollars, federal funding for R&D
grew from $3.5 bil ion in 1955 to $138.9
Figure 2. Federal and Business Shares of
bil ion in 2019, a compound annual growth
U.S. R&D Expenditures, 1955-2019
rate (CAGR) of 5.9%. In constant dollars,
federal R&D grew by a 2.6% CAGR during
this period. However between 2011 and 2014,
federal R&D funding, as measured in current
dollars, fel for three consecutive years for the
first time since such data has been collected;
the total decline in federal funding for these
years was $8.6 bil ion (6.8%). In constant
dollars, federal R&D declined seven from
2009 to 2016 by a total 16.5%; a similar drop

occurred from 1987 to 1994, when federal
Source: CRS analysis of National Science
R&D fel by 16.0%.6 In FY2017, FY2018,
Foundation, National Patterns of R&D Resources: 2018–
and FY2019, federal R&D grew by 2.1%,
19 Data Update, NSF 21-325, Table 6, April 9, 2021,
https://ncses.nsf.gov/pubs/nsf21325.
4.1%, and 5.3% respectively, in constant
Notes: 2019 data are preliminary and may be
dollars.Figure 3 shows federal R&D funding
by budget function in constant dollars from
revised.
1955 to 2020.
Figure 3. Federal R&D Funding by Budget Function, 1955-2020
Current dol ars, in bil ions

Source: CRS analysis of data from National Science Foundation, Federal R&D Funding, by Budget Function: Fiscal
Years 2019–21, (NSF 21-315), Table 23, February 22, 2021, https://ncses.nsf.gov/pubs/nsf21315.

5 CRS analysis of National Science Foundation, National Patterns of R&D Resources: 2018–19 Data Update, NSF 21-
325, T able 6, April 9, 2021, https://ncses.nsf.gov/pubs/nsf21325.
6 Ibid.
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Notes: Data for 1955–1977 are obligations; data for 1978–2020 are budget authority. 2009 data includes
supplemental R&D funding provided by the American Recovery and Reinvestment Act of 2009 (P.L. 111-5). Al
data are for fiscal years. Data for 2020 are preliminary and may be revised. p=preliminary.
Trends in U.S. Business-Funded R&D
Business funding of R&D, measured in current dollars, has grown nearly every year since 1955.
In current dollars, business-funded R&D grew from $2.2 bil ion in 1955 to $463.7 bil ion in
2019, a compound annual growth rate of 8.5%. In constant dollars, business-funded R&D grew
by a 5.1% CAGR during this period. In recent years, business-funded R&D has grown at a slower
pace. Between 2000 and 2019, business R&D grew by 4.9% CAGR in current dollars, and by
2.9% CAGR in constant dollars.7
Current Composition of U.S. R&D Funding
R&D funding can be categorized by the
Character of R&D: Definitions
character of the work that it supports: basic
Basic research. Experimental or theoretical work
research, applied research, and development.
undertaken primarily to acquire new knowledge of
(See text box for definitions.) Total estimated
the underlying foundations of phenomena and
U.S. R&D expenditures in 2019 (the most recent observable facts, without any particular application
or use in view.
year for which data are available) were $656.0
Applied research. Original investigation
bil ion. Of this amount, $107.8 bil ion (16.4%)
undertaken to acquire new knowledge; directed
was for basic research, $124.8 bil ion (19.0%)
primarily, however, toward a specific, practical aim
was for applied research, and $423.4 bil ion
or objective.
(64.5%) was for development.8
Development. Systematic work, drawing on
knowledge gained from research and practical
Table 1 shows total U.S. R&D expenditures in
experience and producing additional knowledge,
2018 by funding sector and character of work.
which is directed to producing new products or
Notably, federal R&D funding accounts for the
processes or to improving existing products or
largest share of basic research (40.7%) while
processes.
business accounts for the largest shares of
Source: National Science Board, Science and Engineering
applied research (55.0%) and development
Indicators 2018.
(85.5%). Figure 4 shows this information
graphical y.
Table 1. U.S. R&D Funding by Sector and Character, 2019
Current dol ars, in bil ions
Basic Research
Applied Research
Development
Total
Sector
Dol ars
Percent
Dol ars
Percent
Dol ars
Percent
Dol ars
Percent
Federal Government
43.9
40.7
41.8
33.5
53.2
12.6
138.9
21.2
Nonfederal Government
2.6
2.4
1.7
1.4
0.6
0.2
5.0
0.8
Business
33.0
30.6
68.7
55.0
362.1
85.5
463.7
70.7
Higher Education
13.6
12.6
5.9
4.7
2.3
0.5
21.8
3.3
Other Nonprofit
14.7
13.6
6.8
5.5
5.1
1.2
26.7
4.1
Organizations
Total
107.8
100.0
124.9
100.0
423.4
100.0
656.0
100.0

7 Ibid.
8 Ibid. Elements do not add to 100% due to rounding.
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U.S. Research and Development Funding and Performance: Fact Sheet

Source: CRS analysis of National Science Foundation, National Patterns of R&D Resources: 2018–19 Data Update,
NSF 21-325, Tables 6-9, April 9, 2021.
Note: Rows and columns may not add to totals due to rounding. 2019 data are preliminary and may be revised.
Figure 4. U.S. R&D Funding by Character and Sector, 2019

Source: CRS analysis of National Science Foundation, National Patterns of R&D Resources: 2018–19 Data Update,
NSF 21-325, Tables 6-9, April 9, 2021.
Notes 2019 data are preliminary and may be revised.
Current Composition of U.S. R&D Performance
R&D is often performed by sectors other than the one funding the R&D. For example, the federal
government performs some of the research it funds, but also funds research performed by
business, universities and colleges, and other organizations. Table 2 provides data on
performance of U.S. R&D by sector and character of the work (basic research, applied research,
and development).
Table 2. U.S. R&D Performance by Sector and Character, 2019
Current dol ars, in bil ions
Basic
Applied
Sector
Research
Research
Development
Total
Dol ars
Percent
Dol ars
Percent
Dol ars
Percent
Dol ars
Percent
Federal Government
12.0
11.1
20.5
16.4
30.6
7.2
63.1
9.6
Nonfederal Government
0.1
0.1
0.5
0.4
0.0
0.0
0.7
0.1
Business
32.0
29.7
72.7
58.2
381.1
90.0
485.8
74.1
Higher Education
49.3
45.7
22.1
17.7
7.3
1.7
78.7
12.0
Other Nonprofit
14.4
13.4
9.1
7.3
4.3
1.0
27.8
4.2
Organizations

Total
107.8
100.0
124.8
100.0
423.4
100.0
656.0
100.0
Source: CRS analysis of National Science Foundation, National Patterns of R&D Resources: 2018–19 Data Update,
NSF 21-325, Tables 2-5, April 9, 2021.
Note: Rows and columns may not add to totals due to rounding. 2019 data are preliminary and may be revised.


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U.S. Research and Development Funding and Performance: Fact Sheet


Author Information

John F. Sargent Jr.

Specialist in Science and Technology Policy



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Congressional Research Service
R44307 · VERSION 15 · UPDATED
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