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NSF  - July 30, 2004

Federal Funding for Activities Related to Research and Development (R&D) Rises in Fiscal Year 2004

Arlington, VA—According to preliminary data from the National Science Foundation (NSF), Federal obligations are expected to reach over $105 billion in fiscal year (FY) 2004 for activities related to research and development (R&D). The new InfoBrief provides preliminary estimates in advance of the detailed statistical report Federal Funds for Research and Development: Fiscal Years 2002, 2003, and 2004, which will be released this fall.

The estimated $105 billion for R&D and R&D plant (costs related to equipment, facilities, and the like) represents a 4 percent increase over the FY 2003 level. Research (both basic and applied) accounts for $54 billion, about half of the total. Development, which comprises design, development, and improvement of prototypes and new processes, accounts for $47 billion, or 45 percent of the total. This reverses a decreasing share of development funding, which fell from 64 percent in FY 1990 to an estimated 43 percent in FY 2003.

These estimates are collected and disseminated as part of NSF’s legislative mandate to “provide a central clearinghouse for the collection, interpretation, and analysis of data on scientific and engineering resources, and to provide a source of information for policy formulation by other agencies of the Federal Government. . ..”

Six federal agencies continue to be the major sponsors of R&D (93 percent of research dollars in FY 2004): the Departments of Health and Human Services (HHS), Defense (DoD), Energy (DOE), and Agriculture; the National Aeronautics and Space Administration (NASA); and the National Science Foundation (NSF). HHS is expected to provide the largest share (52 percent), followed by DoD (11 percent), and DOE and NASA (10 percent each).

The shares of basic and applied research are about equal—25 and 26 percent of the total, respectively. Shares of both grew between 1990 and 2000 and have remained steady since then.

In both basic and applied research, the life sciences account for over half the federal funding. Life sciences include agricultural sciences, biological sciences, environmental biology, and medical sciences. HHS, mostly from the National Institutes of Health, is expected to provide 85 percent of this support.

Federal agencies estimate a 9 percent increase in funding for development, led by DoD, which will provide $39.9 billion, or 85 percent, of the development total, up 11 percent from FY 2003.

The data for this InfoBrief come from NSF’s annual Survey of Federal Funds for Research and Development. The InfoBrief is available on the webpage of the Division of Science Resources Statistics.


The National Science Foundation (NSF) is an independent federal agency that supports fundamental research and education across all fields of science and engineering, with an annual budget of nearly $5.58 billion. NSF funds reach all 50 states through grants to nearly 2,000 universities and institutions. Each year, NSF receives about 40,000 competitive requests for funding, and makes about 11,000 new funding awards. The NSF also awards over $200 million in professional and service contracts yearly.


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