ARKANSAS INVENTIONINDEX | DECEMBER 2025

December 2025: 1.08% (C+ grade)

Arkansas inventionINDEX December 2025: 1.08% (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).

Arkansas inventionINDEX Scores – Last 12 months

 

Month	inventionINDEX Score
December 2025	1.08%
Nov 25	1.19%
Oct 25	1.13%
Sep 25	1.10%
Aug 25	1.08%
Jul 25	1.34%
Jun 25	1.04%
May 25	1.07%
Apr 25	1.12%
Mar 25	0.99%
Feb 25	1.07%
Jan 25	1.08%
Dec 24	1.20%

The December 2025 inventionINDEX for Arkansas reflects a period of measured stability, closing the year at 1.08% with a C+ rating. This performance indicates a slight cooling compared to the 1.19% peak reached in November 2025, yet it remains within the typical bounds observed throughout the latter half of the year. Throughout 2025, the index showed resilience, oscillating primarily between 1.00% and 1.15%, though the standout 1.34% recorded in July suggests that the state maintains the capacity for sudden bursts of high-level innovation. This recent data point serves as a benchmark for the state as it transitions into a new fiscal cycle, highlighting a consistent, if modest, output of inventive activity.

When placed in a broader historical context, the current score of 1.08% sits in the middle of a sixty-month spectrum characterized by notable highs and challenging lows. It remains considerably lower than the exceptional 1.94% high-water mark achieved in October 2023, a time when Arkansas consistently secured A+ ratings and demonstrated peak creative output. However, the current standing is a significant recovery from the five-year low of 0.76% seen in October 2022, which resulted in a D- rating. This trajectory suggests that while the state has moved away from its most volatile downward trends, it is currently seeking the necessary momentum to return to the prestigious A-range performance levels seen during the 2023 and 2024 surges.

The positive outcomes associated with a higher inventionINDEX grade, particularly those in the A and B tiers, are far-reaching for the Arkansas economy. Such scores typically signify a robust period of intellectual property generation, reflecting a successful alignment between entrepreneurial spirit and accessible capital. When the index rises, it often leads to increased interest from venture capitalists and a stronger reputation for the state as a hub for technological advancement. These elevated ratings suggest that research and development efforts are effectively transitioning into tangible assets, which in turn drives high-quality job creation and fosters a competitive environment that attracts top-tier talent from across the country.

Conversely, lower scores in the C and D ranges carry negative implications that warrant careful attention from policy makers and industry leaders. A depressed index score may indicate a bottleneck in the innovation pipeline or a reduction in the resources allocated toward creative development. Such dips can lead to a relative stagnation in industrial growth and may cause the state to lose ground to regional competitors who are more aggressively pursuing patent-heavy industries. Furthermore, a sustained period of lower ratings can dampen investor confidence and slow the pace of economic modernization. Addressing the factors that contribute to these lower scores is essential for maintaining the state’s long-term economic vitality and ensuring that the Arkansas innovation ecosystem remains resilient against broader market shifts.

 

Discussion:

In December, the Arkansas inventionINDEX scored a positive sentiment which was lower than the previous year’s average and underperformed the upward trend for the year. This is similar to the prior 12 months, which experienced a slight 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 Arkansas office provides R&D tax credit consulting and advisory services to Little Rock, Fort Smith, Fayetteville, Springdale, Jonesboro, North Little Rock, Conway, Rogers, Pine Bluff and Bentonville.

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.