Forecast: Slowing Economy Dampens Research and Development Spending

Total funding for research and development (R&D) is expected to increase just 3.3 percent in 2008 from the $355 billion funded in 2007 to the $367 billion expected to be funded in 2008, according to the annual Battelle R&D Magazine forecast.

The generally sluggish movement of R&D funding and performance continues the enterprise's pattern of small year-to-year changes. The dampening of overall spending on R&D can be attributed to some developing
trends including:

-- Restructuring of the major corporate R&D approaches in industry
-- Significant growth of the practice of off-shore out-sourcing of R&D
-- Shift in federal government priorities as a result of world events
-- Growth of the federal deficit.

"There is little doubt that there are some basic problems facing the U.S. research environment, not the least of which include consideration of energy, environment, and the economy," says Battelle senior researcher and
study co-author Jules Duga. "And to a degree not seen in recent years, the average person on the
street is calling for long-term relief from high energy costs, improved (but non-intrusive) security, and resolution of environmental problems."


Funding By Sector

-- The federal government is expected to spend $25.2 billion funding R&D efforts in 2008, a 1.16 percent increase over the $24.9 billion spent in 2007
-- Industrial investments in R&D are expected to reach $258.7 billion in 2008, an increase of 3.4 percent over 2007 levels of $250.3 billion
-- Academia and other non-profits are expected to expend $70.5 billion on R&D in 2008. Academia is forecasted to increase by 5.3 percent from $51.9 billion in 2007 to $54.6 billion in 2008. Non-profit expenditures on
R&D are expected to increase by 4.3 percent from $15.3 billion in 2007 to $16 billion in 2008
-- Federally Funded Research & Development Centers (FFRDC) is a new category to the annual R&D Forecast. The 36 centers are established by various government agencies and are designed to carry out special long-term
research programs on behalf of their parent agencies. Funding for 2007 was $12.7 billion which is expected to drop by 2.3 percent to $12.4 percent in 2008.

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Weather Service Changes In Trouble, Gov't Investigators Find

A planned new operations prototype for the National Weather Service (NWS) is in trouble, according to a new U.S. government report.

To improve the efficiency of its operations, in November 2006, NWS approved an effort to develop a prototype of an alternative way of operating. Under the prototype, weather forecasting offices would share selected responsibilities.

NWS’s prototype is currently on hold pending a reevaluation of the agency’s approach, according to the recent report by the Government Accountability Office (GAO). GAO is the nonpartisan investigative arm of Congress.

The agency had just begun the first phase of its three-phased prototype to demonstrate a new concept of operations over a two-year period when, in late March, a top Department of Commerce official suspended the prototype because of concerns about the agency’s approach, GAO says.

In the first phase, NWS established a program manager and began planning for the next two phases. During the remaining phases, NWS planned to have 20 weather forecasting offices share responsibilities in two-office pairs and then in four-office clusters. NWS then planned to decide whether to implement the new concept of operations on a national basis.

"The justification for the prototype was not sufficient," GAO says. "Before the prototype was suspended, the agency had approved moving forward with its prototype without conducting a cost-benefit analysis. NWS estimated that the prototype would cost approximately $9.3 million and would offer qualitative benefits, such as increased efficiency and an improved ability to focus on severe weather events, but did not quantify benefits or the expected return on its investment. If NWS were to proceed with the prototype without a cost-benefit analysis, it would lack assurance that its approach would be a cost-effective investment for the agency."

The National Weather Service provides storm and flood warnings and weather forecasts nationwide using advanced systems and trained specialists located in 122 weather forecast offices throughout the United States.

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