June 2025: 1.07% (B- grade)

Pennsylvania inventionINDEX June 2025: 1.07% (B- grade)

The inventionINDEX measures innovation output by comparing GDP growth with patent production growth. 

Anything over C grade is positive sentiment; anything under C is negative outlook/sentiment. Using that sentiment, it is possible to observe trends over time, and also compare states/countries. In doing so, we can predict which states have the best chance to recover economically from the pandemic (or any other economic incident that may occur).

The latest inventionINDEX Score for June 2025 stands at 1.07%, reflecting a modest dip compared to previous months. While this figure remains within the general range of the past year, it is notably lower than the 1.19% recorded in May 2025 and the 1.15% in April. This downward trend breaks a six-month period of relative stability and incremental growth, during which scores hovered consistently above 1.10%. Although the current figure does not suggest a sharp decline, it does indicate a potential softening in innovation output or activity within Pennsylvania during this period.

Looking at the broader context, the June 2025 score is slightly below the 12-month average, which calculates to approximately 1.13%. This places the current figure among the lowest of the year, just above the November 2024 trough of 1.00%. Historically, scores around or above 1.14%-as seen in October 2024, January 2025, and July 2024-have corresponded with periods of robust patent filings and technological development. The recent decrease could reflect delays in patent processing, seasonal shifts in R&D cycles, or broader economic headwinds impacting innovation-intensive sectors.

A higher inventionINDEX score generally signals a healthy rate of innovation, which can translate into a range of positive outcomes. These include increased intellectual property activity, greater investment attractiveness, and stronger prospects for tech-based job creation and economic diversification. For research institutions, startups, and established industries alike, a rising score often correlates with momentum in commercialization efforts and a competitive edge in securing funding or partnerships.

A lower score-particularly if sustained over multiple months-may raise concerns about stagnation or reduced innovation output. It could point to barriers in the innovation pipeline, such as funding constraints, talent shortages, or shifts in policy environments. For policymakers and stakeholders, a dip in the index may serve as an early indicator that targeted intervention or support measures are needed to maintain the region’s innovation trajectory and ensure long-term economic resilience.

Discussion:

In June, the Pennsylvania inventionINDEX scored a positive sentiment which was lower than the previous year’s average and underperformed the upward trend for the year. This is in contrast to the prior 12 months, which experienced a slight downward trend. 

As the economy continues to stabilize in the post-pandemic era, it remains uncertain whether any backlog of applications still exists or if the department has returned to normal processing timelines. The inventionINDEX could also be affected by lingering consequences from the pandemic, such as company closures, reduced workforces, and limited R&D capabilities, which may still be impacting current operations.

Learn More:

Are you thinking of patenting any of your bright ideas? Did you know your research work could be eligible for the R&D Tax Credit and you can receive up to 14% back on your expenses? To find out more, please check out our free online eligibility test.

Swanson Reed’s Pennsylvania office provides R&D tax credit consulting and advisory services to Philadelphia, Pittsburgh, Allentown, Erie, Reading, Scranton, Bethlehem, Lancaster, Harrisburg, Altoona, York, State College, Wilkes Barre, Chester, Williamsport, Easton, Lebanon, Hazleton, New Castle and Johnstown.

Feel free to book a quick teleconference with one of R&D tax specialists if you would like to learn more about R&D tax credit opportunities.

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