Economic uncertainty continues to crowd the headlines, given that 2024 is an election year across almost half the globe, and inflation continues to drive up consumer prices throughout North America.
Politics aside, however, there has been a consistent bright spot on the otherwise cloudy economic outlook in the United States: High demand for STEM and R&D jobs.
According to the Bureau of Labor Statistics, STEM—that is, Science, Technology, Engineering, and Mathematics— jobs are expected to see demand grow by almost 11 percent in the United States by 2032. This comes as non-STEM jobs are forecast to only see roughly 2 percent growth by 2032, and just 3 percent for all occupations—STEM or non-STEM—over the same period.
Another interesting stat for would-be STEM professionals? STEM salaries currently top $100,000 annual on average—more than double the average salary for non-STEM.
While this is obviously a boon for job seekers, it’s also a worthy investment for employers, who may be able to actually recoup a large share of the associated payroll costs for STEM talent if they staff these roles strategically.
Although STEM jobs run the gamut—as the Bureau states, “occupations include computer and mathematical, architecture and engineering, and life and physical science occupations” as well as “occupations requiring scientific or technical knowledge at the postsecondary level”—these jobs are generally the ones leading the most innovative R&D programs.
In this blog, we’ll unpack the amazing opportunity that this high demand paints for job seekers, why employers benefit from a robust and effective R&D organization, and how companies can build an R&D team that not only delivers on innovation, but unlocks new avenues for funding.
R&D to drive differentiation (and returns)
As the global economy continues to digitize, R&D will only become more critical to helping businesses stand apart and compete. This is especially true as the realities of artificial intelligence (AI) continue to shift, opening up opportunities for new products or processes that could unlock market-shifting innovation.
R&D departments are also critical to driving market differentiation, and have proven to help businesses unlock access to capital that covers some of the costs of both R&D talent and activities. (For proof-in-action, check out our recent podcast where Chris Hobbs of TTT Studios explains how SR&ED funding has helped him both avoid layoffs and develop groundbreaking products during down cycles).
Despite the pandemic-era rush to embrace remote work (and the associated leveling-of-the-playing-field that WFH unlocked by enabling distributed teams and processes), STEM opportunities continue to be centralized among a few leading Innovation Hubs.
Stateside, historical hot spots on both coasts continue to be the hottest job markets in 2024 for STEM and R&D work, according to recent research from R&D World that combined BLS data with job listings to derive a heat map of where STEM hiring has taken off.
Even in WFH world, STEM jobs are regional (sort of…)
The Greater Boston Market, for instance, is home to almost 1,000 biotech companies alone, thanks in no small part to the “talent pipeline” among the many universities and think tanks (ie. MIT, Harvard—even Greentown Labs) based within the metropolitan area. This is part of why the Northeast continues to be among the hottest markets globally for tech talent, according to the R&D World research.
The Silicon Valley continues to be a hub for software and “Big Tech” STEM hiring as well, the research finds. Apple and Google are both major employers in the region that are constantly jockeying for the best tech talent, despite news of layoffs frequently painting a different story.
San Diego, New York City and Chicago were other hubs touted as hubs for continued STEM opportunities.
But all of this poses a few larger questions for businesses looking to attract the best STEM talent, as well as optimize their R&D to maximize outcomes and opportunities for success.
R&D to drive innovation in any market
For starters, what’s the benefit of leaning into hiring STEM and R&D talent in the first place?
Aside from the obvious credentials and experience required to conduct technical R&D, building a team that’s regularly tackling Technological Uncertainty and accomplishing Technological Advancement could open you up to opportunities to recoup a share of the investments you’re already making to drive innovation.
In both the United States and Canada, there are R&D tax credit programs that reward businesses who do more than standard product development with their R&D and aim to accomplish genuinely unique outcomes.
This added financial coverage from government bodies can also be a boon during downtimes, allowing you to keep more teammates on to execute credit-worthy R&D even when revenue is lacking or capital is tight.
Beyond all of that, R&D uncovers white space in your market, opening up opportunities to ultimately solve more problems and acquire more customers down the line.
That then begs the question: How do teams capture the best talent from these geographically separated markets?
This calls back to the earlier point about prioritizing credit-worthy R&D: While you should never embark on R&D with the sole intention of recouping tax credits, you can only gain those tax credits if you’re driving really powerful innovation.
In that same vein, the leading STEM talent is going to want to work on projects that are rewarding and drive powerful outcomes—and at organizations that put faith and funding behind R&D teams regardless of the market.
This is the “virtuous cycle of R&D” that gets unlocked when teams are strategicc and concerted in creating product roadmaps that reward new ideas and acknowledge the bigger, corporate picture.
To learn how to set up an R&D organization that’s not just rewarding for your STEM talent but can even help inform your capital strategy, talk to one of the R&D tax credit experts at Boast today.
