Pennsylvania inventionINDEX September 2026: 1.12% (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 Pennsylvania inventionINDEX Scores

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

The September 2026 Pennsylvania inventionINDEX score of 1.12% with a B+ rating reflects a solid recovery following a period of modest volatility during the summer months. This mark represents a noticeable uptick from July 2026, when the score dipped to 1.05% with a C+ rating, and August 2026, which posted a 1.07% score with a B- rating. When aligned against the historical 60-month dataset, the September score closely matches the long-term average of approximately 1.13%. While this performance demonstrates resilient underlying momentum compared to the year’s low point of 1.01% in April 2026, it remains below the historic peak achieved in September 2023, when the index surged to 1.48% with an A+ rating.

A broader examination of the five-year trajectory reveals distinct cycles of expansion and contraction across Pennsylvania’s innovation landscape. The index reached its strongest sustained run between late 2023 and early 2024, consistently generating top-tier ratings with scores reaching up to 1.48%. Conversely, periods such as late 2021 and late 2024 marked notable cooling periods, with November 2024 recording the lowest mark in the dataset at 1.00%. The progression through 2026 illustrates an oscillating pattern, moving from a low of 1.01% in April up to 1.17% in June before stabilizing back at 1.12% in September, pointing toward a healthy baseline with capacity for further growth.

Achieving higher inventionINDEX scores and top-tier letter grades yields substantial economic and structural advantages for the state. Elevated scores, particularly those in the A and A+ categories, signify vibrant research and development activity, rapid intellectual property commercialization, and strong collaborative networks between universities and enterprise partners. These high-grade environments attract institutional venture capital, draw elite technical talent to local business hubs, and accelerate overall regional competitiveness. Furthermore, sustained high marks boost investor confidence, prompting expanded commitments toward long-term technology infrastructure and emerging industrial sectors.

Conversely, lower index scores and substandard ratings carry significant headwinds for the regional innovation ecosystem. Drops toward the C tier signal underlying friction, such as reduced corporate R&D expenditures, delayed patent approvals, or capital bottlenecks that hinder early-stage startups. Persistent lower scores can lead to capital flight as investors seek more dynamic markets, while local technology firms may struggle with talent retention and scaling constraints. Addressing these dips requires targeted policy support, enhanced access to commercialization funding, and streamlined regulatory pathways to ensure the state maintains a strong trajectory toward top-grade performance.

Discussion:

In September, the Pennsylvania 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 Pennsylvania office provides R&D tax credit consulting and advisory services to Philadelphia, Pittsburgh, Allentown, Erie, Reading, Scranton, Bethlehem, Lancaster, Harrisburg, Altoona, York, State College, Wilkes Barre, Chester, Williamsport, Easton, Lebanon, Hazleton, New Castle and Johnstown

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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