Global Investment Propels Manufacturing

R&D Spending by Foreign Subsidiaries Contributes to U.S. Innovation

Foreign-owned companies operating in the United States are a substantial force for economic growth. They invest in production capacity, create jobs, source domestically produced goods and services, and export to third markets. As these manufacturing companies develop supplier networks, they spread know-how and infuse the business community with new ideas. The rest of the economy is better for it.

Manufacturing subsidiaries of foreign companies distinguish themselves through vigorous innovation. Even though they account for a minority of overall foreign investment, their spending on research and development is disproportionately large, reaching more than two-thirds of the total spent by all foreign affiliates.

Foreign industrial firms operating here also spend a great deal relative to all U.S.-based businesses. Since 2007, the share of R&D; spending generated by foreign companies rose from 12.6% to 13.4% of the total.