178 



National Resources Planning Board 



laboratory was little more than a raw materials and 

 factor}' control proup, but has since developed into a 

 "research" prroiip of the highest caliber. There is an 

 unmistakable peak in the rate at wliirli industry became 

 research-conscious beginning with the war years, and 

 extending into the 1930's. That this rate of establish- 

 ment has dropped off in more recent years is equally 

 apparent." 



The reasons for this decrease in the rate of adoption 

 of research by new managements are not entirely clear. 

 They may relate to general business conditions, to a 

 saturation of the demand for research, or to entirely 

 different causes. The trend might possibly be inter- 

 preted as a saturation of the opportunities for research, 

 were it not for the small fraction of industry which is so 

 engaged. In any case, here is a possible opportunity 

 for constructive effort in broadening the base of 

 industrial research. 



Geographical Distribution of 

 Research Laboratories 



The map, figure 47, indicates very clearly the con- 

 centration of industrial research laboratories near the 

 large industrial centers, with special emphasis on the 

 Eastern seaboard. Each dot represents one laboratory. 

 Divisional laboratories of the same company are 

 shown individually wherever they are geographically 

 separate. 



Extent of Research in 

 Individual Industries 



Present Research Employment in 

 Various Industries 



A comparison of the relative amounts of research in 

 the various industries reveals some striking contrasts. 

 In figure 48, the individual bars represent the expendi- 

 tures for research measured in man-years by various 

 industrial groups." A rough estimate of the dollar 

 expenditures can be made by using $4,000 as an average 

 for the total cost of research per man-year. Outstand- 

 ing examples of research-minded industries are the 

 chemical, petroleum, and electrical groups. Motor 

 vehicles and rubber, considered together, also rank high . 



» As mentioned on page 176 the method of collectinp data for this survey tends to 

 underrate the number of small companies which have recently established research 

 laboratories. On the other hand, the 1940 survey ha-s pone far beyond any of the 

 previous surveys in an attempt to discover companies not previously reported. In 

 fact, an attempt was made to canvass all of the million-dollar (and larper) manufac- 

 turing companies in the country. Ilence, it Is reasonable to conclude that the small 

 number of recently established laboratories is not primarily duo to incomplete data, 

 except in the case of companies under a million dollars (capitalisation). 



'* The in<]ustrial groups follow, in penoral, the United States Census of Manufac- 

 tures classification (U. S. Department of Commerce. Bureau of the Census. Biennial 

 census of manufacturers. Washington, U. S. Government Printing Office). There 

 are, however, some difTerences. The exact composition of the groups is discussed in 

 Industrial Research and Changing Technology. See footnote 1. Some of the in- 

 dustrial groups might appropriately be consolidated, as for example, "radio apparatus 

 and phonographs" with "electrical communication." This was not done in order to 

 present the present data on a basis strictly comparable with that of the eailier and 

 more detailed report cited above. 



Comparative Research Employment in 

 Various Industries: 1927-1938 



The rate of growth of research in the various in- 

 dustrial groups is showTi by figure 49, which compares 

 research employment " for the 2 years 1927 and 1938. 

 This permits also an examination of the extent of 

 research in various industries at each of these two dates. 

 Of the industries prominent in research, petroleum 

 shows by far the most rapid growth during this eleven 

 year period. Radio and foods have also rapidly 

 expanded their research staffs. 



Both figures 48 and 49 represent the total research 

 expenditure by the industry, but without considering 

 disparity in size between industries. If one wishes to 

 compare one industry with another on the basis of 

 rcsearch-mindedness alone, the differences in size 

 should be taken into account. This has been at- 

 tempted in figure 50, wliere the bars represent research 

 expenditure '" as a percentage of the dollar value of the 

 products of the industry. This is perhaps a crude 

 method of adjusting all industries to the same base, 

 but the errors introduced in this way are small as com- 

 pared with the actual differences in the degree of 

 utilization of research. It is interesting that some of 

 the industries which lead in researcli employment drop 

 to somewhat lower ratings when the size of the industry 

 is taken into account, whereas other industries such as 

 radio and stone, clay and glass appear to better 

 advantage. 



Summarizing the above data on the distribution of 

 research by industries, the one outstanding fact is the 

 enormous discrepancies in the extent to which research 

 is utilized. Without question, the opportunities and 

 the needs differ from industrv to industrj', but it is 

 difficult to believe that the differences in opportunity 

 can be so large. Moreover, the examples of rapid re- 

 search expansion which have recently been set hj such 

 long established industries as food and paper indicate 

 that the industrial research technique is widely applica- 

 ble. It would appear that fertile fields for increasing 

 the Nation's wealth might well be developed by the 

 encouragement of research throughout the entire 

 industrial structure. 



"In comparing figures 48 and 49 the heights of the bars of figure 48 should be reduced 

 to the mark near the top of the bar. This Is because figure 48 represents total employ- 

 ment, whereas figure 49 shows the "comparable totals" referred to lo footnote 4. The 

 latter totals are indicated in figure 48 by the mark on the bat. 



i> Research expenditures were computed on the basis of $4.(X)0 total cost per man- 

 year. This is oiwn to the obvious objection that the figure used applies, strictly 

 speaking, to 1910 and not to either 1938 or 1927. Even (or 1910 It represents a rough 

 average for all industries, leveling the dillereneos between individual industries. 



The choice of the dollar value of output rather than the value added by manufac- 

 ture as a basis of comparison between industries is oix-n to the same objections as the 

 common method of expressing research in terms of sales, namely that certain indus- 

 tries handle large amounts of materials but perform only minor manufacturing 

 o|>eralions on these materials, whereas in other industries, the reverse is true. This 

 objection is valid only to the extent that research Is a more valuable tool for perfecting 

 manufacturing procedures than for eflecting economies and Improvements In 

 materials. 



