Economic Loss due to Health Funding Cuts as Distributed Across Geospatial Units
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Importance
The National Institutes of Health (NIH) introduced a 15% cap on indirect research costs on February 7, 2025 and the Department of Health and Human Services (HHS) terminated over 2,500 grants as of June 30, 2025. We show that assessing the economic impacts of biomedical research funding cuts on local communities requires accounting for commuting flows.
Objective
To determine the annual economic impact of realized and proposed cuts to NIH research at local levels throughout the United States.
Design
We analyze terminated grants reported to Grant Witness as of June 30, 2025 and indirect cost reductions associated with grant awards documented in NIH RePORTER to identify the extent of realized and proposed cuts to research funding. Using commuter data, we estimate the distribution and magnitude of estimated economic losses across all 3,144 counties in the United States.
Main Outcome(s) and Measure(s)
Economic and job losses at the county level resulting from the proposed cap on indirect costs (what we term ‘future losses’) and terminated grants (‘current losses’).
Results
Nationally, we estimate $8.2 billion in current losses from terminated grants and $16.6 billion in future losses from the proposed indirect cost cap. Every U.S. county would experience some economic loss due to the proposed cap on indirect costs, and losses would exceed $100,000 in 2,136 counties. Losses from terminated grants exceed $100,000 in 1,185 counties. We anticipate that nearly half of losses would be experienced in counties other than those where the affected research institutions are located.
Conclusions and Relevance
This analysis demonstrates that accounting for commuter flows is critical for understanding the impact of realized and proposed cuts to biomedical research funded by NIH. This analysis suggests that biomedical research funding cuts will lead to substantial and widespread economic losses in communities throughout the U.S.
Key Points
Question
How will realized and proposed cuts to NIH biomedical research funding impact local economies?
Findings
By accounting for commuter flows, we estimate that 2,136 U.S. counties will experience over $100,000 in economic losses if indirect cost caps are implemented – far more widespread than the 376 counties where NIH-supported grantees are located. Similarly, 1,185 counties face economic losses exceeding $100,000 due to realized NIH grant terminations under a commuter model, exceeding the 191 counties where institutions with terminated grants are located.
Meaning
Integrating commuter flows is essential for assessing the substantial, widespread impacts of cuts to biomedical research funding.
