COLORADO INVENTIONINDEX | DECEMBER 2025

December 2025: 1.55% (A- grade)

Colorado inventionINDEX December 2025: 1.55% (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).

Colorado inventionINDEX Scores – Last 12 months

The Colorado inventionINDEX concluded the sixty-month historical period in December 2025 with a score of 1.55 percent and a rating of A-. This performance represents a period of relative stability, though it sits slightly below the five-year historical average of 1.73 percent. When compared to the preceding months of 2025, the December figure reflects a modest recovery from the November low of 1.32 percent, yet it remains lower than the mid-year peak of 2.23 percent recorded in July. This concluding data point suggests a steadying of the innovation landscape as the region transitions into the subsequent year, maintaining a respectable standing despite recent volatility.

Examining the broader sixty-month trajectory reveals a dynamic range of activity within the state inventive sectors. The index reached its zenith in October 2023 with a notable score of 2.44 percent, while its historical floor occurred in December 2021 at 1.21 percent. Throughout the last five years, the index has frequently oscillated between the A and A+ tiers, demonstrating a high baseline of creative output. However, the occasional dips into the B range, such as those seen in late 2021, mid-2022, and twice in late 2024 and 2025, serve as reminders of the cyclical nature of research, development, and intellectual property filings.

Achieving a high grade, particularly in the A+ category, yields significant positive outcomes for the regional economy. High scores typically correlate with a surge in patent applications, increased venture capital interest, and a robust pipeline of new technologies entering the market. When the Colorado inventionINDEX sustains these elevated levels, it reinforces the state reputation as a premier hub for high-growth industries and attracts top-tier talent from across the globe. Such momentum fosters a self-sustaining cycle of prosperity, where successful commercialization funds the next generation of breakthroughs.

Conversely, a lower score or a downward trend in ratings carries negative implications that warrant careful attention. A move into the B or B- territory often indicates a deceleration in new idea generation or a tightening of the resources necessary for innovation. These periods may reflect broader economic headwinds, such as reduced research budgets or a temporary pause in entrepreneurial risk-taking. If sustained, lower scores could lead to a loss of competitive advantage relative to other states, potentially slowing the long-term growth of the high-tech workforce and the overall economic output of the region.

Discussion:

In December, the Colorado inventionINDEX scored a positive sentiment which was lower than the previous year’s average and underperformed 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 Colorado office provides R&D tax credit consulting and advisory services to Denver, Colorado Springs, Aurora, Fort Collins, Lakewood, Thornton, Arvada, Westminster, Pueblo and Centennial.

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.