NIH Funding Led to a 250 Percent Economic Return on Investment

Research funding does not just benefit the scientists who receive these grants. Instead, its economic benefits ripple through the community in the form of jobs and monetary exchanges. Despite a challenging year for biomedical research through funding freezes and grant cancellations, a recent report showed that this funding continued to power local economies in fiscal year (FY) 2025.

United for Medical Research (UMR), a coalition that promotes biomedical research funding, demonstrated how awards from the National Institutes of Health (NIH) increased economic activity through jobs and revenue. Using data from the NIH Research Portfolio Online Reporting Tools and the Bureau of Economic Analysis, they showed that for every one dollar the NIH spent on research funding, it generated more than $2.50 in economic activity. The report also highlighted how multi-year funding reduced the number of awarded grants from the agency, leading to fewer funded researchers per budget cycle.

Research Funding Promoted the US Economy in FY2025

In FY2025, which ran from October 1, 2024 to September 30, 2025, the NIH awarded more than $36 billion in research funds to US scientists. UMR estimated that these research dollars contributed more than $94 billion to the US economy through paychecks that employees used on goods and services, the purchase of lab supplies, and investments in research and technology infrastructure. Most states saw an increase of at least $100 million to their local economies, while some saw as much as a $5 billion increase in circulation.

Research funding also stimulated jobs in every state in the nation, creating anywhere from a couple hundred to tens of thousands of jobs. Across the country, NIH awards supported more than 390,000 positions.

“There is no investment more worthwhile than our nation’s investment in biomedical research,” said Senator Susan Collins, the chair of the Senate Appropriations Committee, in a social media post related to NIH funding.

Despite delays in grant reviews and fund disbursement, the NIH successfully spent its full budget for FY2025. To do this, though, the agency used multi-year funding, in which it pays out the full grant award in one year instead of in yearly increments for the full term of the grant.

When the agency sends more funds to a single grant, fewer researchers are funded overall. This led to a nearly nine percent decrease in the number of grants that received funding in FY2025 compared to FY2024. Similarly, the use of multi-year funding decreased the NIH funding rate, or the number of successfully funded researchers per grant cycle, to 17 percent, the lowest level in three decades. UMR expressed concerns about how these lower rates limit research progress.

The Outlook for Research Funding in 2026 Has Potential and Obstacles

“Even amid funding disruptions last year, NIH research continued to deliver extraordinary value for patients and communities across the country,” said Caitlin Leach, the president of UMR said in a press release on the report. “The return on investment is undeniable—but maintaining that return requires strong and stable NIH funding.”

In February, the US budget allocated $47.2 billion to the NIH. While many researchers expressed optimism at this support, others remained hesitant given previous challenges and new changes to grant funding mechanisms. Additionally, although Congress capped the amount of multi-year funding that could be allowed by the agency, the NIH will be able to use this funding mechanism in FY2026 to the same extent as in FY2025.

The impacts of these new policies and this budget are yet to be seen, but the value of NIH research funding to the economy is evident.