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Infographic – Private R&D Outpacing Defense Contractors

Private sector and defense R&D

Click on image for full-size view (Statista)

5 Oct. 2019. If you grew up during the Cold War like I did, you’ll recall national defense and security needs were paramount, with a lot of tax dollars going into research to keep us ahead of the Soviet threat. During that time, big defense contractors like Boeing and Lockheed regularly rolled out products of that R&D — their latest military aircraft and defense-related systems, which in some cases eventually filtered down to civilian goods like commercial aircraft or microwave ovens.

National security threats changed since then, and so have research spending patterns in the U.S. Our friends at Statista this week offer a stark illustration of how private companies have surpassed defense contractors in R&D spending, this weekend’s infographic. Statista took the data from a report on innovation and national security published last month by the Council on Foreign Relations.

Those data show in 2018, information technology companies invested far more in R&D than defense contractors. Amazon leads the pack with $23 billion in R&D spending, followed by Alphabet, the parent company of Google, with $16 billion. Intel, Microsoft, and Apple each invested from $12 to $13 billion in R&D last year. The largest R&D investments by defense contractors were Boeing and United Technologies, with $2 to $3 billion each.

Keep in mind that the IT companies shown on the chart actively pursue business from the Pentagon, and defense contractors have commercial divisions as well.

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