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).

New York inventionINDEX Scores – Last 12 months

The New York inventionINDEX for March 2026 currently stands at 1.03 percent, yielding a C rating. While this figure is technically an improvement over the 0.77 percent D rating seen at the start of the year, it remains a modest performance for a state with such significant intellectual capital. The score has shown marginal growth from February 2026, indicating a slow but steady climb out of the stagnation observed during the final quarter of 2025. This stabilization suggests that the local innovation environment is finding its footing, though it has yet to reclaim the momentum required for a more competitive grade.

When viewed against the historical backdrop of the past sixty months, the current index appears subdued. In March 2021, the state enjoyed an A+ rating at 1.70 percent, a stark contrast to the current 1.03 percent. Throughout 2021 and portions of 2022, the index frequently reached into the A and B ranges, peaking again in August 2023 at 1.57 percent. The current data reflects a departure from those high-performance periods, sitting closer to the troughs seen in December 2022. This long-term comparison reveals a general downward trend in New York’s inventive output relative to its peak potential, emphasizing a need for renewed focus on intellectual property development.

Achieving a higher grade, such as an A or B+, carries significant advantages for New York’s economic landscape. Higher inventionINDEX scores generally indicate a robust pipeline of new patents, a surge in research and development activities, and a healthier climate for venture capital investment. When the state reaches these elevated tiers, it signals to global markets that the region is a premier destination for technological advancement and creative talent. These periods of high ingenuity often lead to the creation of high-value jobs and a more resilient economy that can better withstand broader industrial shifts.

Conversely, the persistence of lower grades like the D+ and C- ratings seen throughout much of 2025 has sobering implications. A declining or stagnant index often points to a lack of new industrial development and a potential migration of creative talent to more supportive environments. If the index remains low, it suggests that the state’s competitive edge is dulling, which can discourage external investment and slow down the pace of commercialization for new technologies. Addressing the factors that contribute to these lower scores is essential to ensuring that New York remains a leader in the global race for innovation rather than settling into a state of industrial inertia.

Discussion:

In March, the New York inventionINDEX scored a positive sentiment which was higher than the previous year’s average and outperformed the downward trend for the year. This is similar 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 New York office provides R&D tax credit consulting and advisory services to New York City, Buffalo, Rochester, Yonkers, Syracuse, Albany, New Rochelle, Mount Vernon, Schenectady, Utica, White Plains, Troy, Niagara Falls, Binghamton, Rome, Long Beach, Poughkeepsie, North Tonawanda, Jamestown and Ithaca.

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. 

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