Hawaii inventionINDEX July 2026: 1.01% (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).

Historical Hawaii inventionINDEX Scores

The Hawaii inventionINDEX score for the past 12 months is shown in the table below.

The Hawaii inventionINDEX score for July 2026 stands at 1.01% with a C rating, reflecting a noticeable pullback from the standout 2.86% (A+) registered in June 2026. Looking across the historical dataset spanning the past five years, the current score sits below the 60-month historical average of approximately 1.33% and slightly underneath the median benchmark of 1.17%. While July 2026 demonstrates a moderation in momentum, it remains safely above the historical floor of 0.50% recorded in June 2024. Comparing this result with previous years reveals a cyclical pattern where high-performing months are periodically followed by brief consolidation phases before regaining upward traction.

A multi-year examination of the dataset highlights recurring volatility alongside strong recovery capacity within the index. In 2026 alone, the index reached top-tier A+ ratings in January, March, April, and June, with three of those months posting identical 1.85% scores. Historical peaks, such as the all-time high of 3.03% in July 2024 and 2.19% in August 2023, demonstrate that the region regularly achieves exceptional periods of inventive output. Conversely, periods of compression, including D-level ratings in February 2025 (0.67%) and November 2023 (0.67%), underscore that dips below 1.00% occur periodically but are rarely sustained over extended durations.

Achieving a higher grade, such as an A- or A+ rating with scores exceeding 1.50%, carries substantial strategic and economic benefits for the regional innovation ecosystem. High ratings signal robust intellectual property generation, active research and development efforts, and strong commercialization prospects. Superior scores foster investor confidence, attract venture capital, and encourage cross-sector collaboration between institutions and private enterprises. Furthermore, sustained high ratings enhance overall market competitiveness, driving job creation in technology sectors and positioning the market as a resilient hub for vanguard technological advances.

In contrast, lower scores and degraded ratings, such as C, D, or F classifications, present notable challenges that require targeted intervention. Dropping below the historical mean indicates slowing patent activity, deferred research funding, or bottlenecks in the transition from concept to market application. Extended periods of depressed scores risk diminishing investor engagement, slowing intellectual property portfolio expansion, and exposing local industries to competitive displacement from more agile markets. Identifying the root causes of lower ratings enables stakeholders to realign capital allocation, streamline development pipelines, and restore long-term growth momentum.

Discussion:

In July, the Hawaii inventionINDEX scored a positive sentiment which was lower than the previous year’s average and 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 Hawaii office provides R&D tax credit consulting and advisory services to Honolulu, East Honolulu, Pearl City, Hilo and Kailua

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.

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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.

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