Federal Stimulus Funding for Research: An Assessment of Employment Responses

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The American Recovery and Reinvestment Act (2009) includes substantial direct and indirect support for research in a number of scientific and social science fields through NSF, NIH, the Department of Energy, the Department of Education, and other federal agencies. The magnitude of this stimulus and the planned rapid infusion of resources into the academic-based scientific enterprise provide a unique opportunity to understand how the production of science research and the associated employment of scientists respond to large changes in funding. Stimulus funding may have a substantial impact on university hiring and staffing, though the magnitude of these impacts will depend on the underlying elasticity of supply in the labor market for high-skilled workers in science and engineering (S&E). To the extent that the international supply of doctorate-level workers in science and engineering is much greater than the domestic supply, a substantial share of the increase in S&E employment in response to the stimulus may come from foreign PhDs. Collection of data on stimulus-related funding allocations in the coming two-year period is critical to record and assess the impact of research funding on employment outcomes in science and engineering labor markets. This works tracks the projected employment changes as recorded in grant budgets as well as realized changes in employment, salary levels and enrollment available through institution-level data. As the pool of non-citizen PhDs may be an important source of temporary employment for university research projects, the project records the issuance of new H1-B visas by year at the level of the university and broad field. Further, as research funding in science and engineering fields often includes graduate student support, the interaction between graduate enrollment and the distribution of stimulus funding is measured and modelled. The empirical analysis of this project examines how a sudden and substantial increase in research funding affects employment, compensation and graduate enrollment in academic S&E research sectors. BROADER IMPACTSWhile it is often argued that the social return to federal R&D expenditures is quite high, empirical evaluations of how changes in funding of university research affect graduate attainment, the employment of scientists, and research output are rare. This research plan offers direct evidence on the link between research funding and labor market outcomes in science and engineering fields; in addition, this approach provides a window to study the link between research funding and other dimensions of university production including graduate education. Measuring these parameters in the setting of the increasingly globally integrated scientific and engineering labor markets of the 21st century will inform policy decisions on science funding and employment, framing the understanding of the distributional impacts of government funding of university-based research.