VIRGINIA INVENTIONINDEX | SEPTEMBER 2025

September 2025: 1.97% (A+ grade)

Virginia inventionINDEX September 2025: 1.97% (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).

Virginia inventionINDEX Scores – Last 12 months

The Virginia inventionINDEX for September 2025 stands at 1.97%, earning an A+ grade. This score is consistent with the generally strong performance observed over the past 60 months, where the index has frequently maintained an A or A+ rating. While slightly lower than the peak of 2.21% in December 2020 and 2.16% in July 2025, it remains above the lowest recorded score of 1.29% in December 2021, indicating a sustained period of positive innovation output.

A consistently high inventionINDEX score, particularly an A+ grade, signifies robust economic health and a thriving environment for innovation within Virginia. A higher grade suggests that the state’s GDP growth is effectively supported by a strong increase in patent production, reflecting a dynamic and inventive economy. This positive sentiment can attract further investment, foster job creation in high-tech sectors, and contribute to long-term economic resilience, allowing the state to better navigate economic fluctuations.

Conversely, a lower inventionINDEX score, such as the B grade seen in December 2021 or the A- grades in various months, indicates a potential deceleration in innovation relative to economic growth. Such a trend could signal underlying challenges in research and development, reduced investment in new technologies, or a less favorable business climate for innovators. The implications of a sustained lower score could include slower economic recovery, a decrease in competitive advantage, and a potential brain drain as talent seeks more innovative environments.

Analyzing the historical data reveals that while the Virginia inventionINDEX has experienced minor fluctuations, it has largely remained in the positive sentiment range. The current September 2025 score, while not a peak, demonstrates a stable and healthy innovation landscape when viewed in the broader context of the past five years. Continuous monitoring of these trends is crucial for understanding the state’s economic trajectory and implementing policies that further stimulate innovation and maintain a high inventionINDEX.

Discussion:

In September, the Virginia inventionINDEX scored a positive sentiment which was higher than the previous year’s average but 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 Virginia office provides R&D tax credit consulting and advisory services to Virginia Beach, Norfolk, Chesapeake, Richmond, Newport News, Alexandria, Hampton, Roanoke, Portsmouth, and Suffolk.

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.