Tech companies lead top U.S. companies in R&D spending.
That’s notable because spending on research and development is a key indicator for U.S. productivity, a measure of how well our economy is doing, and productivity has been decreasing lately. No one is really sure why, especially given all the advances in technology.
But spending on R&D is another factor in measuring productivity, and tech companies are certainly contributing in that area.
Led by Amazon, Alphabet, Intel, Microsoft and Apple, tech companies spent more on research and development than any other companies in the S&P 500 that reported such data, according to FactSet data from the most recent fiscal year.
Amazon spent $16.1 billion on R&D last year, a figure that should strike fear into its competitors, as these investments could make the online retailer even more dominant.
Amazon recently beat out the previous leader, Volkswagen, to become the biggest corporate spender on research and development in the world. It’s now ahead of pharmaceutical and car companies, the previous R&D leaders.
Back to productivity for a second: U.S. productivity has slowed since the recession, meaning that our gross domestic product is not keeping up with the amount of labor Americans are putting in. In other words, we’re working more but producing goods and services at a lower rate.
But the way productivity is measured could be discounting the impact of tech’s products. Many of the goods and services that tech companies produce — Google’s searches and Facebook’s social network, for example — don’t cost anything and by that measure don’t contribute to economic output.
This article originally appeared on Recode.net.