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Science Resources Studies Division National Science Foundation DATA BRIEF by M. Marge Aachen Directorate for Social, Behavioral and Economic Sciences Vol. 1996, No. 1, February 2, 1996, Academic R&D

R&D expenditures for the sciences and engineering increased faster in the mid-'70s as well. But the rate of growth has slowed since then: In 1994 academic R&D expenditure was 17.6% higher than in 1993, and inflation adjusted inflation for R&D was 10.9%. This slowdown in growth in inflation adjusted academic S&E R&D in 1994 is due to a combination of decreasing inflation across all S&E industries, decreasing inflation in the sciences and higher inflation in other disciplines. The number of R&D institutions is also declining as more institutions focus primarily on basic science: only 3% of universities participated in S&E R&D in 1994 in comparison with 5% in the mid-'70s. The rate of growth in inflation-adjusted S&E research expenditure is very much slowed down by the aging of the population: the age distribution of S&E R&D has changed and is now becoming younger at all levels. The decline of the S&E population is not matched by a decrease in the share of the total population participating in research. As a result of this age and cohort effect, the overall rate of increase in inflation-adjusted S&E R&D expenditure is slowing down rapidly in the early stages of the growth slowdown. The share of S&E R&D expenditure going to basic science is also declining: in 1994, only 4.9% of S&E R&D in the United States went to basic science activities, compared with 5.1% of S&E R&D in the mid-'70s. This decline is in part due to improved productivity among the less productive scientists and is being reversed in the next decade. Some key S&E activities are also being outsourced: in the early 1970s, a large share of S&E R&D in the U.S. was performed by university and government labs. Most of the work was done outside the country that year. A much larger share is now done by private firms that conduct these projects in-house. A recent change in administration in one such firm, AT&T Bell Laboratories, has accelerated this trend. The company's business strategy for the next ten years () centers on new areas of research. A recent survey by the American Society for Engineering Education lists “cybersecurity, molecular biology, biotechnology, computer sciences and more” among the major research areas that it projects will grow rapidly in the next ten years.

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