Fact of the Week: Between 2013 and 2015, 10 Percent of U.S. Firms Introduced a New or Significantly Improved Product

January 14, 2019

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Between 2013 and 2015, 10 percent of U.S. firms introduced a new or significantly improved product, ranging from 51 percent of computer products manufacturers to 4 percent of real estate firms.

Source: National Science Foundation, Business R&D and Innovation Survey 2015.

Commentary: One of the simplest measures of innovation is the rate at which firms change the goods or services they offer in response to market demands or to take advantage of new technologies. But as data from the Census Bureau shows, this phenomenon differs drastically by industry. From 2013 to 2015, 10.4 percent of all U.S. firms introduced new or significantly improved projects—but the figure was 24.3 percent for manufacturing firms versus 9.2 percent of nonmanufacturing firms.

Among manufacturing firms, the computer products (50.7 percent), electrical equipment (42.6 percent), and chemicals (36.0 percent) industries ranked as the most innovative, while the furniture (12.1 percent) and wood products (12.9 percent) industries were the least innovative. The worst-performing nonmanufacturing industries—real estate (4.2 percent), transportation (4.8 percent), and insurance (5.4 percent)—were drastically less innovative than any manufacturing industries, while the best-performing industries were technologically focused, in data processing (40.1 percent), computer services (38.4 percent), and research and development services (38.2 percent).