Here’s how much in-house R&D the military services did in the 1960s

That was from a congressional hearing in July 1961.* I’m actually somewhat surprised that the Air Force performed upwards of 20 percent of their RDT&E using in-house laboratories. I’d guess that these figures include the personnel and facilities costs associated with managing contracted work as well. Army and Navy performed between 30-40 percent in-house, which corresponds with other figures I’ve seen. As late as 1970, the Navy still performed roughly 35 percent in-house.

Here are some additional notes from the hearing, which indicates the nuance and difficulty getting accurate figures on such things:

Regardless of the pros and cons, the result was the support of a broad research and development effort approximating $5 billion per year of which only about $1.6 billion was being supported by research and development appropriations. For example, in fiscal year 1957, support was estimated to be as follows: Research and development $1.6B; Procurement $2.8B; Military personnel and military construction $0.6B. Total = $5.0B.

 

… In the fiscal year 1960 budget estimates, with the establishment of the new research, development, test, and evaluation title, a start was made toward (1) the transfer of all development, test, and evaluation support costs from operation and maintenance and procurement accounts to the new research, development, test, and evaluation accounts, and (2) the separate identification under procurement accounts of the development, test, and evaluation support items remaining- in procurement appropriations…

 

SIGNIFICANT SUPPORT OF THE RESEARCH, DEVELOPMENT, TEST, AND EVALUTION PROGRAM PRESENTLY NOT INCLUDED UNDER RDT&E APPROPRIATION

1. Requirements included under ‘Military construction’ appropriations.
2. Pay and allowances of military personnel assigned to R.D.T. & E. activities included under Military Personnel appropriations.
3. Separately identified development, test, and evaluation support remaining under Air Force procurement appropriations.
4. Certain headquarters administrative costs included under other appropriations.
5. Contractor independent research and development effort provided for under procurement contract overhead arrangements.
6. Ships, aircraft, and other operational or standard military equipment, military facilities, and operational military unit, utilized in connection with test and evaluation effort.

While these and other minor items provide necessary and valuable support to the overall R.D.T. & E. effort, it is not practicable, and in most cases it is not possible without excessive administrative effort, to identify the related costs or to support such costs under R.D.T. & E. appropriations.

*Source: HEARINGS BEFORE THE SUBCOMMITTEE ON REORGANIZATION AND INTERNATIONAL ORGANIZATIONS OF THE COMMITTEE ON GOVERNMENT OPERATIONS UNITED STATES SENATE EIGHTY-SEVENTH CONGRESS FIRST SESSION AGENCY COORDINATION STUDY (PURSUANT TO S. RES. 26, 87TH CONG.) JULY 26 AND 27, 1961 PART 1