RESEARCH & DEVELOPMENT

2024 R&D Report

Illinois’ Capacity for Innovation & Economic Growth

Why R&D Matters to us

The Illinois Science and Technology Coalition (ISTC) recognizes research and development (R&D) as the cornerstone of innovation. The Organisation for Economic Co-operation and Development (OECD) defines R&D as “creative work undertaken on a systematic basis to increase the stock of human knowledge, and the use of this knowledge to devise new applications.” Every dollar invested has the power to transform lives and economies—advancing cancer treatments, improving child safety in vehicles, and creating adaptable educational tools.

The COVID-19 pandemic underscored the importance of R&D, highlighting unprecedented global collaboration among companies, higher education, and governments to develop vaccines, treatments, and diagnostics. It demonstrated how urgent challenges can be overcome when resources, expertise, and motivation align.

ISTC’s 2024 R&D Report will explore Illinois’ leadership across vital sectors, emphasizing how R&D drives economic growth, sparks innovation, and addresses critical societal challenges, reinforcing Illinois’ role as a hub for progress.

Key Findings

Total R&D Activity

While Illinois ranks 10th nationally in Total R&D with $21.6B spent in 2021, the state’s 4.43% five-year growth rate ranks 41st among all states (and D.C) and falls significantly below the national average of 9.55%. Additionally, Illinois’ R&D intensity of 2.28% lags behind the national average of 3.4%, suggesting the state is underperforming relative to its economic size despite maintaining a position among the top R&D performing states.

Business R&D

Illinois ranks 9th nationally in Business R&D with $16.485 billion spent in 2021, but the state’s 3.44% five-year growth rate falls significantly behind the national average of 10.78%. While Illinois demonstrates strength in certain sectors, ranking 1st in Food R&D, 2nd in Machinery R&D ($1.72B), and 3rd in Financial Technology R&D, federal support for business R&D in the state has dramatically declined from $768M in 2017 to just $60M in 2021.

Companies in Illinois are largely self-funding their R&D activities, with 93.4% of Business R&D financed internally compared to the national average of 87.6%, suggesting a heavier burden on Illinois companies to fund their own research and development efforts.

Higher Education R&D

Illinois colleges and universities invested $3.16 billion in research during FY2022, ranking 9th nationally, though the state’s 5.30% five-year growth rate falls slightly below the national average of 5.44%. The funding structure for Illinois academic research relies heavily on federal sources (61.5%) and institutional funds (24%), while state and local funding remains notably low at 1.3% compared to the national average of 5.02%. Illinois maintains a strong position in research outputs, ranking 6th nationally with 15,272 science and engineering publications, though licensing income has declined significantly from $294.7M in FY2018 to $73.9M in FY2022, largely due to the patent expiration of Lyrica.

The state has shown particular strength in social sciences, life sciences, and physics research, which all grew faster than national averages from 2018 to 2022, while mathematics research declined partially due to the phase-out of the Blue Waters Supercomputer at Urbana-Champaign.

University-Industry Collaboration

Illinois ranks 8th nationally in business-funded academic R&D with $198.2M in 2022, maintaining a growth rate close to the national average, while also ranking 8th in shared grants with 29 collaborative projects. Although co-assigned patents have declined both nationally (-4.41%) and in Illinois (-3.98%) between 2019 and 2023, with Illinois recording 51 such patents in 2023, the state has shown remarkable growth in co-authored research publications, achieving a 9.18% annual growth rate (compared to the national rate of 3.34%) and producing 729 collaborative publications in 2023.

These metrics collectively place Illinois in the top quartile of states for knowledge creation through university-industry partnerships, ranking 13th in co-assigned patents and 10th in co-authored publications.

Federally Funded Research and Development Centers R&D

Illinois is home to two major Federally Funded Research and Development Centers (FFRDCs): Argonne National Laboratory, which ranked 11th nationally with $963M in R&D expenditures in FY2022 and focuses on materials science, energy, and computing research, and Fermilab, which ranked 17th with $330.29M and specializes in high-energy particle physics. While Argonne has shown strong growth with a 5.50% five-year CAGR and impressive 12.42% one-year growth between FY2021-2022, Fermilab’s growth has been more modest with a 0.14% five-year CAGR and 3.52% one-year growth, both laboratories primarily conducting basic research with Argonne having a higher proportion of applied research (44.92%) compared to the national FFRDC average of 40.87%.

Looking Forward

Based on data shared in this report, ISTC recommends three critical strategies to pursue in order to promote economic growth in Illinois. The recommendations include:

Attract new businesses in emerging sectors like quantum, semiconductor manufacturing, and electric vehicle production.
Support collaborative research between academic institutions and businesses headquartered in Illinois.
Invest in computer science research opportunities at Illinois institutions of higher education.

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