R&D
According to the National Science Foundation, US R&D spending fell 13.1% to $233.92 billion in 2008. The drop during the previous, milder recession was only 0.5%. For the 232 companies in the Standard & Poor’s 500 index, aggregate R&D expenditures increased from $163.37 billion in 2008 to $166.42 billion in 2009. One reason is because technology is now more integral to new products. Furthermore, reduced R&D spending does not signal less innovation. Declines may be due to reductions in employee bonuses. Also, R&D spending is shifting from innovation to incremental alterations to current products to accommodate the changing needs of the customer base. US patent filings for new inventions have remained flat since 2002. Companies are also focusing more on external collaborations for R&D.
Source: BusinessWeek