What a difference a few years (and an election) can make.
In FY 2023, U.S. colleges and universities reached a milestone in research and development (R&D) investment. An 11.2% year-over-year increase pushed funding for higher education research to $108.8 billion — the largest since 2003.
No more.
NIH funding cuts, caps on indirect research costs, and other threats to funding research for higher education are causing massive disruption. Just one area, the cap on research spending, would cost universities a collective $4.3 billion, according to an Inside Higher Ed analysis. On average, each affected institution would lose $9.6 million, with some seeing losses of $50 million or more. Such threats are already forcing reductions in research activities and requiring layoffs.
In this volatile environment, leaders must rethink what works and what doesn’t when it comes to funding research in higher education.
Some strategies have proven effective over the years in securing and sustaining funding for higher education research.
For some institutions, federal funding can make up half or more of total R&D funding. However, relying solely on federal funding is risky. Institutions with stronger foundations often build a mix of support from private foundations, philanthropic gifts, corporate R&D partnerships, and cooperative consortia.
Diversified funding helps institutions weather the changes in any one source without derailing research priorities.
Institutions with centralized grant development services often win more awards. These teams assist with compliance, budget design, and alignment with funding priorities.
Establishing centers that tackle nationally significant challenges, like public health, clean energy, or AI, makes institutions more competitive for large-scale funding. These initiatives also encourage cross-departmental collaboration, which many funders now seek.
However, institutions may need to adapt funding requests to current governmental priorities to continue funding for higher education research.
Cooperative contracts reduce administrative overhead and procurement timelines while achieving cost reductions. When faculty and labs get quicker access to specialized tools and services, research can start faster, scale more efficiently, and stay on budget.
Just as important as knowing what works is knowing what doesn’t. Institutions face significant risk when they fall into these traps:
Overdependence on Federal Grants
Federal support remains essential to funding research in higher education, but we’re seeing the impact on institutions that rely too heavily on federal funding. Left vulnerable to policy changes, diversification of funding sources has become a more strategic necessity.
When procurement and research offices don’t work together, inefficiencies grow. Long purchasing cycles and misaligned vendor processes can delay grant-funded projects and affect compliance, putting future funding at risk. They can also waste money.
Despite funding challenges, outdated labs, software, or administrative systems can disqualify institutions from competitive funding calls. Maintaining modern, scalable research environments is critical for success.
One-off purchases may work in the short term, but long-term research initiatives benefit from deeper, more collaborative vendor partnerships. Strong supplier relationships often produce innovative solutions that can help meet budgetary constraints while providing higher value.
In an era of constrained resources, procurement teams can play an increasingly strategic role in funding for higher education research. Cooperative purchasing through E&I Cooperative Services enables faster access to compliant, pre-negotiated contracts. This helps institutions reduce costs, minimize risk, and redirect savings into mission-critical research.
With faculty and administrators under pressure to make every research dollar count, leveraging smarter procurement practices can help offset funding cuts and make procurement teams the heroes that keep research flowing.
You can’t control government funding policies, but you can control how effectively you prepare for and respond to changes. Securing sustainable funding for higher education research requires a combination of forward-thinking strategy and operational efficiency. By avoiding common pitfalls and embracing smarter, more collaborative practices, colleges and universities can continue driving discovery and innovation despite the noise in Washington.
While you may not be able to offset significant losses and funding cuts, you can be proactive to maximize the value of every dollar you spend. Cooperative agreements leverage the aggregated purchasing power of hundreds or thousands of institutions to lower procurement costs and produce terms favorable to colleges and universities.
Explore E&I’s portfolio of cooperative contracts for research institutions. Whether you’re navigating NIH uncertainty or streamlining lab procurement, our solutions help you stretch every dollar—and drive discovery forward.
