ALASKA INVENTIONINDEX | AUGUST 2025

August 2025: 1.17% (C+ grade)

Alaska inventionINDEX August 2025: 1.17% (C+ 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).

Alaska inventionINDEX Scores – Last 12 months

The Alaska inventionINDEX score for August 2025, at 1.17% with a C+ rating, indicates a moderate level of inventive activity. When compared to the historical data from the past 60 months, this score falls within a typical range of fluctuation. The data shows significant volatility, with scores varying from the lowest recorded 0.44% (rated F) to the highest at 2.65% (rated A+). This variation suggests that the state’s inventive output experiences cyclical peaks and troughs, rather than following a steady, predictable path. For example, the current C+ rating for August 2025 is a notable improvement over the D+ rating from the preceding two months, but it remains a considerable distance from the high marks achieved in periods like February 2024 or November 2021.

A higher inventionINDEX score, particularly one in the A+ or B+ range, is a strong indicator of a thriving and dynamic ecosystem of innovation. A rising index suggests an increase in the number of patents filed, a potential for new business formation, and heightened entrepreneurial activity. This robust inventive climate can lead to significant positive outcomes, including attracting private investment, creating high-skilled jobs, and enhancing the state’s overall economic competitiveness. For instance, the 2.65% A+ scores observed in November 2021 and March 2021 likely coincided with periods of significant technological breakthroughs or increased research and development spending within the region. Such periods of high performance can also elevate Alaska’s profile as a hub for innovation, drawing attention and resources from outside the state.

Conversely, a lower inventionINDEX score, such as the frequent 0.44% F ratings, signals a period of reduced inventive output. This decline can have negative implications for the state’s economic health and future prospects. A sustained low score may reflect a lack of investment in research, a decrease in the number of new inventions, or a challenging environment for innovators. This can lead to a decline in economic diversification, a slowdown in job creation in technology sectors, and a missed opportunity to leverage intellectual property for growth. The recurrent appearance of these lower scores across the 60-month period underscores the challenges and the need for continuous support of innovation to prevent long-term stagnation.

In conclusion, the historical data illustrates the cyclical nature of Alaska’s inventionINDEX, highlighting the importance of ongoing support for innovation. The August 2025 score represents a moment of moderate activity, but it is the broader trend that offers the most valuable insight. Analyzing both the peaks and troughs of the index provides a comprehensive view of the state’s capacity for invention and its potential for economic growth. The fluctuations in the score serve as a crucial barometer, reflecting the ebb and flow of creative and technological progress within the region over time.

Discussion:

In August, the Alaska inventionINDEX scored a positive sentiment which was higher than the previous year’s average and outperformed 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 Alaska office provides R&D tax credit consulting and advisory services to Anchorage, Fairbanks, Juneau, Sitka and Wasilla.

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.