Industrial R&D Surging, Report Shows

Industrial research and development investment activity is at its highest level since the early 1980s, reaching a record-setting $205.7 billion in 1997, according to a new National Science Board (NSB) report to Congress. The newest edition of Science and Engineering Indicators 1998 attributes the rise in R&D investments to international competition, information technology, and record profits.

According to the 800-page report, U.S. industry is increasing investments in its own research facilities as well as increasing cooperation with colleges and universities. And patents are increasingly citing public research at academic and non-profit institutions, as well as government research facilities. "The results are striking," says Neal Lane, outgoing director of the National Science Foundation, which develops science and engineering indicators for NSB. "Scientific research, especially that based at universities, is proving to be a major contributor to industrial innovation."

However, the report also cautions that short-term R&D may be displacing "the longer term quest for new knowledge and breakthrough discoveries."

Additionally, the report states that joint research ventures between firms have been growing, with the largest increases occurring in 1995 and 1996, and global cooperation is increasing, with more than 4,000 multifirm alliances formed to develop information technologies since 1986.

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