Tennessee inventionINDEX September 2026: 1.57% (A+ 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 Tennessee inventionINDEX Scores

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

The Tennessee inventionINDEX score for September 2026 reached 1.57%, securing an elite A+ rating and continuing a period of exceptional stability across the state’s innovation ecosystem. When measured against the comprehensive 60-month dataset spanning from late 2021 through late 2026, this latest performance stands notably above the overall historical average of 1.48%. While slightly below the peak score of 1.72% recorded in August 2026, September matches the 1.57% mark established in May 2026, confirming that current creative and commercial outputs remain at a high caliber. Out of the 61 total monthly observations evaluated, over half achieved an A+ distinction, illustrating a resilient long-term trend where Tennessee consistently operates in upper-tier performance bands.

A broader multi-year perspective highlights a significant positive trajectory when contrasting recent results with earlier historical periods. In late 2021 and early 2022, the index experienced its lowest recorded valuation, dipping to 1.07% in December 2021 with a C+ grade, alongside several B-range scores throughout 2022 and 2023. By contrast, performance over the past twelve months has averaged 1.57%, driven by historical highs such as July 2025 at 1.87% and September 2025 at 1.84%. This evolution demonstrates that the region has largely moved past earlier volatility, establishing a higher baseline of innovation metrics compared to the foundational years of the index.

Maintaining high scores and top-tier grades generates several tangible advantages for the state’s economic and technological standing. Strong ratings, particularly those in the A and A+ categories, signify a thriving environment for patent generation, research deployment, and entrepreneurial scaling. Higher grades serve as a powerful beacon for external investment, reassuring venture capitalists, corporate partners, and institutional stakeholders that local intellectual property pipelines are active and productive. Furthermore, elevated index levels foster job creation within high-growth sectors, encourage university technology transfer, and bolster overall economic competitiveness on both national and global scales.

Conversely, a regression toward lower index scores carries notable drawbacks for long-term regional development. When the index drops into B or C tiers, as observed during prior cyclical troughs, it typically points to slowing commercialization cycles, reduced research funding efficiency, or broader macroeconomic headwinds affecting local inventors. Prolonged weakness in these metrics can diminish investor confidence, slow the conversion of novel research into viable commercial products, and potentially cause top talent to seek better opportunities elsewhere. Monitoring these score shifts allows policy makers and industry leaders to implement targeted interventions before minor dips transform into structural declines.

Discussion:

In September, the Tennessee inventionINDEX scored a positive sentiment which was higher than the previous year’s average but 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 Tennessee office provides R&D tax credit consulting and advisory services to Nashville, Memphis, Knoxville, Chattanooga, Clarksville, Murfreesboro, Franklin, Jackson, Johnson City and Bartlett

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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