R&D spending leaps over recession

Research and development spending during the worst recession since the Great Depression has managed to avoid a downturn, according to a new survey. In its annual survey of the 1,000 largest corporate spenders on R&D, Booz & Company found--remarkably--that their budgets rose nearly 6 percent in 2008. Eight of the top 10 R&D spenders in the software and Internet sector increased their spending, the study said.

R&D certainly appears to be recession-proof. That rate of spending was less than in 2007 when R&D spending rose 10 percent. Nevertheless, the survey found that 70 percent of the companies intend to maintain or increase R&D outlays in 2009.

"The thing that surprised us was that R&D spending didn't actually drop," Barry Jaruzelski, a Booz partner, told the New York Times. "But innovation is a fundamental strategy for these companies to hold onto their markets and gain an edge on their competitors. So it's sort of an arms-race issue. They don't want to disarm, despite the short-term economics."

That doesn't mean that anything new will be coming from the high-tech sector anytime soon. It does means that the recession did not slow down the quest for new products and new ways to move ahead.

For more on high-tech R&D:
- see this New York Times article

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