May 2026: 1.25% (A- grade)

Maryland inventionINDEX May 2026: 1.25% (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).

Maryland inventionINDEX Scores – Last 12 months

The Maryland inventionINDEX reached a score of 1.25% in May 2026, securing a strong A- rating. This latest figure reflects a swift and vital recovery from the sharp contraction observed in April 2026, when the index dipped to a 1.08% score and a C+ rating. By climbing seventeen basis points in a single month, the index has nearly realigned with its high-performing position from March 2026, which stood at 1.28%. Furthermore, the May 2026 performance sits just slightly above the historical 60-month macro average of approximately 1.24%, demonstrating that despite short-term volatility, the regional innovation ecosystem remains resilient and anchored to a healthy baseline.

Evaluating the full 60-month historical trajectory highlights a pattern of consistent structural strength interspersed with occasional anomalies. The absolute peak of the index occurred in October 2023, reaching an outstanding 1.59% with an A+ rating, closely rivaled by other strong periods such as July 2025 at 1.49% and June 2021 at 1.48%. Conversely, the most severe outlier in the entire dataset is recorded in May 2023, when the index plummeted to a historic low of 0.58%, resulting in a failing F grade. Outside of this singular anomaly and a handful of minor drops into the C range, the index exhibits remarkable stability within premium tiers, with A-level and B-level ratings accounting for fifty-two of the sixty months analyzed.

Maintaining a higher grade on the inventionINDEX carries profound positive implications for the economic and academic landscapes. Higher tiers, such as the current A- status, serve as a clear signal to institutional investors, venture capitalists, and federal agencies that the region possesses a highly productive research and development infrastructure. This optimal environment accelerates the commercialization of novel technologies, fosters collaborative partnerships between private industries and elite universities, and drives high-value job creation. A thriving index score ultimately enhances regional competitiveness, ensuring that intellectual property creation translates directly into sustainable economic expansion and market leadership.

Conversely, downward shifts into lower grading brackets generate significant negative consequences for the local innovation framework. When the score experiences sharp declines, such as the contraction to 1.08% in April 2026 or the extreme drop to 0.58% in mid-2023, it indicates underlying friction, such as reduced capital liquidity, patent backlogs, or diminished research output. Prolonged exposure to lower scores can trigger a damaging cycle characterized by investor skepticism, reduced grant allocations, and a potential brain drain as top-tier scientific and engineering talent migrates to more dynamic regions. While the historical data suggests these downturns are typically short-lived, they emphasize the necessity of proactive policy support to prevent temporary market corrections from solidifying into long-term systemic stagnation.

Discussion:

In May, the Maryland inventionINDEX scored a positive sentiment which was higher than the previous year’s average and outperformed the downward trend for the year. This is in contrast to the prior 12 months, which experienced an upward 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 Maryland office provides R&D tax credit consulting and advisory services to Baltimore, Frederick, Rockville, Gaithersburg, Bowie, Hagerstown, Annapolis, College Park, Salisbury and Laurel.

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.