July 2025: 2.59% (A+ grade)

Minnesota inventionINDEX July 2025: 2.59% (A+ 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).

Minnesota inventionINDEX Scores – Last 12 months

The most recent Minnesota inventionINDEX Score for July 2025, at 2.59%, represents a significant upward trend and marks the highest score recorded in the last 60 months. This figure exceeds the historical average score of 1.68% by a considerable margin, demonstrating a period of exceptional innovative output. When compared to the previous month’s score of 1.39%, the recent score shows a robust increase, indicating a positive and energetic shift in the state’s invention landscape. This performance places the index at its peak for the entire five-year period, reflecting a remarkable surge in innovative activity.

A high inventionINDEX Score, such as the current A+ rating, is indicative of a flourishing and dynamic environment for innovators. This elevated score suggests that a high number of patents and creative ideas are being produced, which often correlates with economic vitality. A strong index score can attract investment, foster business growth, and create new job opportunities within technology and research sectors. Furthermore, a high rating signals that the state is a leader in innovation, which can boost its reputation and draw skilled professionals seeking to contribute to a forward-thinking ecosystem.

Conversely, a lower inventionINDEX Score, such as the C- rating seen in April 2023 with a score of 0.91%, implies a more stagnant period for new ideas and patented inventions. Such a decline can be a cause for concern as it may signal a slowdown in research and development, potentially leading to reduced economic competitiveness. A consistently low score can deter investors and companies that rely on innovation to drive their business, possibly causing a talent drain as inventors and entrepreneurs seek more favorable environments. A reduced index score therefore suggests that the state’s innovative engine may not be operating at its full potential.

Ultimately, the historical data highlights the cyclical nature of innovation and the importance of monitoring the inventionINDEX Score as a key economic indicator. While the index has experienced both peaks and troughs over the past five years, the current score and rating of 2.59% and A+ respectively, showcase a period of significant growth and achievement. Maintaining this momentum will be crucial for the state to sustain a competitive edge and continue to nurture a vibrant and successful ecosystem for inventors and entrepreneurs.

Discussion:

In July, the Minnesota inventionINDEX scored a positive sentiment which was higher than the previous year’s average and outperformed the downward trend for the year. This is similar 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 Minnesota office provides R&D tax credit consulting and advisory services to Minneapolis, Saint Paul, Rochester, Duluth, Bloomington, Brooklyn Park, Plymouth, Maple Grove, Woodbury, and St Cloud.

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.

Who We Are:

Swanson Reed is the largest Specialist R&D tax credit advisory firm in the United States. With offices nationwide, we are one of the only firms globally to exclusively provide R&D tax credit consulting services to our clients. We have been exclusively providing R&D tax credit claim preparation and audit compliance solutions for over 30 years. 

Swanson Reed hosts daily free webinars and provides free IRS CE and CPE credits for CPAs.  For more information please visit us at www.swansonreed.com/free-webinars or contact your usual Swanson Reed representative.

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