Minnesota inventionINDEX August 2026: 1.74% (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 Minnesota inventionINDEX Scores

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

The August 2026 Minnesota inventionINDEX score of 1.74% with a B+ rating marks a solid rebound from July 2026’s 1.39% (B-), positioning the region back into an above-average performance tier. Compared to the 60-month historical average of approximately 1.64%, the latest rating demonstrates healthy resilience in local innovation metrics. While it remains below the peak seen earlier in June 2026 (1.93%, A-), August 2026 outpaces the same month from the previous year (1.55%, B in August 2025). This upward shift signals renewed momentum in regional intellectual property generation and commercial development activities.

Examining the broader five-year historical trajectory reveals noticeable cyclical volatility, anchored around a core median score of 1.66%. The dataset highlights extraordinary highs, such as the peak of 2.59% (A+) achieved in July 2025, alongside notable troughs like April 2023’s score of 0.91% (C-). While top-tier A-range ratings have occurred periodically across sixteen of the recorded months, the index spends most of its duration in the reliable B-grade spectrum. The August 2026 result confirms that Minnesota continues to hover comfortably within its upper performance distribution rather than drifting toward historical low points.

Sustaining higher grades, such as B+ or A ratings, carries significant positive implications for Minnesota’s economic and research ecosystem. Stronger index figures reflect robust patent filing activity, heightened research and development expenditure, and increased venture capital interest across technology and healthcare sectors. High ratings serve as a valuable benchmark for institutional investors, helping to attract top-tier talent and foster private-public innovation partnerships. Ultimately, elevated scores indicate an expanding pipeline of commercializable ideas capable of driving long-term job growth and productivity gains.

Conversely, sustained declines into lower score tiers, particularly C-range ratings falling below 1.30%, highlight potential structural risks or macroeconomic headwinds. Lower ratings point toward reduced commercialization activity, tighter corporate budget allocations for research, or delays in regional patent processing. When the score trends downward, local startups may encounter challenges securing capital, while established enterprises might delay key product launches. Monitoring these lower dips is essential for policymakers and business leaders aiming to address regulatory or financial bottlenecks before short-term slowdowns turn into chronic innovation deficits.

Discussion:

In August, the Minnesota 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 Minnesota office provides R&D tax credit consulting and advisory services to Minneapolis, Saint Paul, Rochester, Duluth, Bloomington, Brooklyn Park, Plymouth, Maple Grove, Woodbury and St Cloud

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.