R&D spending in America is increasing – NSF report reveals

Businesses spent more on research and development (R&D) in 2011 compared to 2010, according to a new study carried out by the National Science Foundation (NSF).

In 2011 companies spent a total of $294 billion on R&D, up from $279 billion in 2010.

The data comes from the Business and R&D and Innovation Survey (BRDIS).

Companies belonging to the manufacturing industry spent $201 billion in domestic R&D and companies in non-manufacturing spent $93 billion.

Manufacturing industries with the highest amount invested in R&D in 2011 were:

  • Aerospace products
  • Computer and electronic products
  • Pharmaceuticals and medicines

The majority of funding, for both industries, came from their own company funds (around 81 percent of total funding).

The main source of outside funding for R&D came from the U.S. federal government – a total of $31 billion – most of it coming from the Department of Defense.

Companies that participated in R&D in 2011 reported domestic net sales of $9 trillion.


Funds spent for business R&D performed in the United States, by source of funds and size of company: 2010–11
(Millions of U.S. dollars)
Selected characteristic20102011
Domestic R&D performancea278,977294,093
Source of funds
Paid for by the company221,706238,768
Paid for by others57,27155,324
Size of company (number of domestic employees)
25,000 or more99,133102,623

i = > 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.

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

States investing the most in R&D

Companies in California alone accounted for 26.8% of the $294 billion spent on R&D in 2011. Other states with large amounts of company-funded business R&D, included:

  • Washington (5.7%)
  • Texas (5.4%)
  • Massachusetts (5.3%)
  • Michigan (5.1%)
  • New Jersey (5.0%)
  • Illinois (4.5%)
  • New York (3.8%)
  • Pennsylvania (3.8%)
  • Connecticut (2.6%)