A thriving innovation economy requires a robust research and development expenditure with participation by the private sector, government, academia and other nonprofits.
For Memphis to grow we need to grow research and development expenditures.
A study in 2019 of higher education research and development in the United States showed that Memphis conducted only $155M dollars that year, placing the metropolitan area at a rank of 99th out of the top 100 metropolitan areas. On GDP rankings by metropolitan area Memphis ranks 49 out of the top 100 metro areas. To match up our higher education research and development with our ranking of 49th in GDP a total of $477MM or greater would be needed in expenditures in higher educational institutions.
In corporate research and development, Memphis does not fare any better. Out of the top 100 metro areas, Memphis ranks 91st with only $369MM of spending in 2017 according to the National Science Foundation and Census Bureau. To be 49th would take the Memphis metro area spending $1.08B or more in corporate research and development.
Research and development expenditures turn into employment expenditures.
At present in higher education research and development Memphis is employing just 2621 personnel according to the National Science Foundation 2018 survey. Assuming the metro could jump up to a rank of 49th it would be 5524. That’s more than double the high paying, high quality jobs. Stacking up the ideal amount of corporate research and development ($1.08B) and the ideal higher education expenditure ($477MM) should yield over 1000 patents a year according to National Science Foundation statistics instead of the 326 produced in 2015 in the Memphis Metropolitan area.
Dynamic growing economies have higher research and development expenditures, greater amounts of high quality jobs, more patents, and even more startup activity.
The Brookings Institution found that metropolitan areas with higher levels of research and development expenditure tended to have more startup activity, as measured by the number of new business establishments per capita. The study also found that research and development expenditure had a strong relationship with startup activity in high-tech industries such as software and biotechnology.
By increasing research and development expenditures, Memphis can unlock its full potential, driving innovation, creating high-quality jobs, and fostering a dynamic economy that attracts and sustains startup activity.
Sources:
- SSTI https://ssti.org/blog/useful-stats-higher-ed-rd-intensity-metro-2019
- NSF https://ncses.nsf.gov/pubs/nsf21331
- SSTI https://ssti.org/blog/useful-stats-rd-personnel-state-and-metro-area
- USPTO https://www.uspto.gov/web/offices/ac/ido/oeip/taf/cls_cbsa/allcbsa_gd.htm
- Muro, M., Rothwell, J., & Saha, D. (2017). The Metropolitan Business Plan: A Framework for Growing Jobs and Businesses in American Metropolitan Areas. Brookings Institution. https://www.brookings.edu/research/the-metropolitan-business-plan-a-framework-for-growing-jobs-and-businesses-in-american-metropolitan-areas/