A while ago, I wondered whether to apply for funding if you knew the funding rate was only 3%. Back then, most people said to apply anyway (which I did by the way; didn't get the money though). However, today I came across this paper in PlosOne entitled: "To apply or not to apply; a survey analysis of grant writing costs and benefits" (which I found via naturejobs). The authors did a survey on 195 astronomers and social and personality psychologists who apply to three US federal agencies: NASA, the NIH, and the NSF. They found - according to naturejobs:
[They] found that applications took on average 116 hours to prepare for principal investigators and 55 hours for co-investigators. More submissions increased the chances of receiving funding, but time spent writing a proposal had little correlation with success.
Then, they calculate how much time it takes to write one or more grant applications per year and what the chances are of getting funded. They next come with the following recommendations (emphasis added by me):
Because a 20% funding rate will force at least half of all proposers to abandon federally funded research after multiple years of effort, we recommend that proposers, research mentors, and funding agencies compare current funding rates to this value. We suggest that individual investigators should consider avoiding proposing to programs with funding rates at or below 20% unless they are confident that their research program has a greater-than-baseline chance of success or they are willing to write two or more proposals per year.
They next suggest that perhaps institutions should decide who gets to apply for low-chance funding, so that the others can focus on something else and do not waste their time writing potentially unsuccessful grants.
This is very different advice than the "always apply" that I normally hear. I know that in some of the homecountry's institutions this is how it goes for personal grants from the homecountry scientific organization: that the institutions do a sort of pre-screening round to see who gets to submit (which I find doubtful: do the institutions know what reviewers will say about a grant? And are internal committees a good way to decide who gets to submit?). And where do 'the other' people get funding to do their research?