IndusirkU Research 



185 



Below sales of approximately $25,000,000 or net 

 income of approximately $2,500,000, other considera- 

 tions become the controlling factors. One does not 

 find, as might perhaps be expected, that the above 

 proportionality sets a rather sharp lower limit to the 

 size of company which can or does afford to do research. 

 Rather, there is a tendency for some companies whose 

 sales and net income are comparatively low to maintain 

 a small laboratory regardless of their volume of business. 

 This almost certainly does not represent the average 

 case for companies of restricted sales and income. 

 However, it is of interest that in the exceptional cases 

 where research is supported at all, the average labora- 

 tory staff remains approximately constant at S to 10 

 workers, and its size is independent of sales or income. 



For the more representative cases where the pro- 

 portionality holds between research expenditures and 

 sales or net income, the percentage spent for research 

 can be deduced on the assumption that the total cost 

 per man-year is $4,000. The results are as follows: 



Percent 



Research expenditure to sales 0. 6 



Research expenditure to net income 6. 



These are over-all ratios for industry in general. 



Summary and Conclusions 



1. A total of 2,350 companies have recently reported 

 70,033 persons engaged in technical research in industry 

 in the United States. 



2. This is a 41 percent increase over the personnel 

 reported 2 years ago. Slightly more than half of the 

 increase is a real growth, principally of the staffs of 

 laboratories established prior to 1938; the remainder is 

 an apparent growth, due to extended coverage of the 

 1940 survey. 



3. The rate of increase of research personnel in 

 industry during the last 2 years is twice the average 

 rate for the last 20 years. 



4. On the other hand, the rate at which research is 

 being adopted by new managements appears to have 

 fallen off substantially in recent years. 



RESEARCH STAFFS MAINTAINED BY CORPORATE UNITS 

 OF VARIOUS SIZES IN THE CHEMICAL INDUSTRY 



100,000 



100 1,000 lopoo 



DOLLARS IN THOUSANDS 



TANGIBLE NET WORTH OF INDIVIDUAL CORPORATE UNITS 



Figure 54. — Research Staffs Maintained by Corporate Units of Various Sizes in the Chemical Industry: 1940 



1.000,000 



