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A proposal by US President Joe Biden’s administration to boost funding for the National Institutes of Health (NIH) by US$9 billion in 2022 has won praise from researchers and science-policy analysts. But some observers worry that the windfall, which would raise the NIH budget by more than 20%, could lead to increased competition and career uncertainty among PhD students and postdoctoral researchers, a potential echo of past cycles of boom and bust.

Previous large increases in funding — notably the doubling of the NIH budget from 1998 to 2003 — created a glut of junior scientists who lacked long-term career prospects, says Navid Ghaffarzadegan, a science-policy researcher at Virginia Polytechnic Institute and State University in Falls Church. The proposed funding boost could be a “shock to the system”, he says. “We need to invest in science, but there are side effects that we have to watch out for.”

Although a budget increase of the magnitude seen in the early 2000s isn’t likely to occur any time soon, that experience still serves as a cautionary tale, says Michael Lauer, the NIH’s deputy director for extramural research. Lauer recalls that the budget doubling sent US universities into a state of “euphoria” marked by rapid expansion of facilities, increased grant applications and a surge in the hiring of early-career researchers. “The community responded exactly as you’d think it would,” he says. “There was an assumption that the growth would continue forever — and that assumption turned out to be incorrect.”

Extreme hangover

As NIH budgets stagnated and even declined in subsequent years, the expanded pool of researchers had to compete for dwindling resources, and the success rate of grant applications steadily plummeted. “There was an extreme hangover,” Lauer says. Before the doubling, more than 30% of applications to NIH for R01 grants — the agency’s oldest funding mechanism — were funded. By 2008, the success rate had dropped to 23%.

A sudden infusion of $9 billion could once again trigger a hiring spree of postdocs and graduate students, Ghaffarzadegan warns. In 2012, he and his colleagues reported that even small increases in funding can have an outsize impact on hiring1. Because much of the NIH budget for any given year is allocated to previously awarded grants, any fresh money tends to go disproportionately towards new grants, and those require new employees.

Ghaffarzadegan and his colleagues proposed a ‘rule of four’, meaning that any increase in the overall NIH budget would have four times as much impact in terms of new projects for that year. “A 20% increase could translate into something like an 80% increase in new funding,” Ghaffarzadegan says.

Ghaffarzadegan says shocks and disruptions could be avoided by increasing budgets slowly and predictably over time. “I’m a fan of incremental change, but I can see where that may not always be practical from a political perspective.”

Funding increases are welcome and helpful for science as a whole, but they don’t always improve the long-term career prospects of junior researchers, says Paula Stephan, an economist at Georgia State University in Atlanta. She noted in a 2010 report that there is little evidence of the doubling in NIH funding leading to an increase in the number of permanent jobs for new PhD holders2.

Stephan agrees that an additional $9 billion could shake up the system, but she sees several key differences between the current proposal and the doubling of the past. For one thing, she expects that the budget won’t keep climbing for several years in a row.

Restraining euphoria

The current career landscape should also keep any euphoria in check, Stephan says. “The labour markets in academe have been pretty frozen,” she says. She notes that only about 10–15% of newly minted US PhD holders can expect to land tenure-track positions, a reality that is forcing many junior scientists to rethink their hopes.

Another factor that is likely to blunt the impact of the NIH’s funding boost on postdocs, Stephan says, is that $6.5 billion of the increase is allocated to creation a body called the Advanced Research Project Agency for Health (ARPA-H). Biden has said that the proposed agency, modelled on the US military’s Defense Advanced Research Projects Agency (DARPA), will aim to “develop breakthroughs to prevent, detect and treat diseases like Alzheimer’s, diabetes and cancer”. Following the DARPA model, it would fund time-limited projects in industry as well as academia. Stephan says companies have historically been reluctant to hire postdocs, so any money that flows to industry through the new agency isn’t likely to drastically change the postdoctoral job landscape.

And postdocs aren’t as affordable as they used to be, notes Stephan. Over the past five years, the starting stipend for postdocs funded through the NIH’s National Research Service Awards has climbed to $53,760, up from less than $44,000 in 2016. “That’s appallingly low for how many hours they work, but it’s a marked increase,” she says. The probable upshot of that rise, she predicts, is that laboratories will be more hesitant to hire large numbers of fresh postdocs to work on new grants. “The price tag has gone up, and that makes you reconsider how you structure your lab,” she says.

Nicole Parker, a science-policy analyst with Future of Research, a group based in Pittsfield, Massachusetts, that advocates on behalf of early-career researchers, says that ARPA-H isn’t likely to lead to more competition for jobs and grants. “The problem is still there, but I don’t think the increase is going to make it worse,” she says.

First grants

Parker says the proposed NIH funding boost is a positive sign for US science. “There’s a stronger desire to trust science in this administration, and there’s a desire to put funds into research and development,” she says. In her view, any extra funding could be particularly helpful to early-career researchers if it went to programmes to help them get their first grants. “Just giving money to the same people who always get grants doesn’t leave any room for new people,” she says.

Lauer notes that in the 2020 fiscal year, the NIH’s Next Generation Researchers initiative funded an all-time high of more than 1,400 “early-stage investigators” — researchers who had earned their final degree within the past 10 years but hadn’t received a major NIH grant.

He says that the agency also pays particular attention to “at risk” researchers who have submitted high-quality applications for NIH funding but have no back-up if their application is denied. “Many of them were funded for the first time four or five years ago, and are trying to renew that grant or start a new one,” he says. “We’re bringing those people to the attention of our colleagues at our institutes and centres.”

Lauer declined to speculate on the specifics of next year’s budget, but says he doesn’t expect a repeat of the euphoria and turmoil seen two decades ago, largely because of lessons learnt. “We remember that experience,” he says.