Iowa inventionINDEX September 2026: 1.17% (B- 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 Iowa inventionINDEX Scores

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

The September 2026 Iowa inventionINDEX score of 1.17% with a B- rating reflects a stable, mid-tier positioning when evaluated against the broader 60-month historical trajectory. This figure represents a slight contraction from August 2026 (1.18%, B), yet marks a noticeable rebound from the summer trough in July 2026, where the score dipped to 1.07% (C+). When viewed against the extraordinary high-water marks of early 2026—such as January’s 1.87% (A+) and March’s 1.72% (A+)—or the overall 60-month peak of 1.96% recorded in April 2025, the current metric demonstrates a period of economic moderation rather than rapid expansion. However, maintaining a score well above historical lows, such as the 0.88% (D+) recorded in July 2022 or the 0.98% (C-) in March 2023, indicates that the underlying inventive capacity remains resilient.

Contextualizing the 60-month dataset reveals distinct cycles of innovation intensity, with significant shifts occurring between periods of heightened output and economic consolidation. The late 2025 through early 2026 sequence stands out as an exceptionally strong run, characterized by five consecutive months of A+ ratings between September 2025 and January 2026, peaking at 1.94% in December 2025. Similar surges occurred in spring 2025 and summer 2023, illustrating that peak inventionINDEX metrics typically coincide with accelerated capital deployment and robust patenting activity. Conversely, the market experienced sustained softer periods during late 2024, when scores hovered around 0.99% to 1.09%, and mid-2022, which saw the lowest recorded score in the dataset. The present score of 1.17% places Iowa squarely near its historical median, balancing past growth spikes with seasonal cooling.

Achieving higher inventionINDEX scores and top-tier ratings, such as the A+ grades frequent in late 2025, delivers multi-faceted benefits to the regional economic ecosystem. Elevated scores signal strong technological progress, robust research and development productivity, and heightened entrepreneurial activity across key sectors. These top ratings serve as a compelling indicator for venture capitalists, institutional investors, and corporate partners seeking high-growth opportunities, thereby driving capital inflows into Iowa. Furthermore, sustained high ratings foster workforce expansion by attracting specialized engineering and scientific talent, encouraging local universities to commercialize research, and bolstering regional tax revenues through high-value enterprise growth.

Conversely, prolonged periods of lower scores and diminished ratings—such as the C- and D+ metrics observed in mid-2022 and late 2024—carry notable economic risks. A lower grade points to decelerated innovation output, reduced patent filings, or tightening credit conditions that constrain start-up growth and technological development. These downturns can lead to reduced venture funding, potential talent flight to more dynamic markets, and a general slowdown in regional competitiveness. By monitoring these fluctuations against historical benchmarks, stakeholders can implement targeted policy interventions and research incentives during softer periods to steer the index back toward upper-tier performance.

Discussion:

In September, the Iowa inventionINDEX scored a positive sentiment which was lower than the previous year’s average but 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 Iowa office provides R&D tax credit consulting and advisory services to Des Moines, Cedar Rapids, Davenport, Sioux City, Iowa City, Waterloo, West Des Moines, Ames, Council Bluffs and Dubuque

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.