June 2026: 1.13% (B- grade)

Vermont inventionINDEX June 2026: 1.13% (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 Vermont inventionINDEX Scores

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

The Vermont inventionINDEX for June 2026 holds steady at 1.13% with a B- rating, matching the performance of May 2026 and reflecting a period of relative stabilization. When evaluated against the broader 60-month historical spectrum, this score positions the region in a moderate growth phase, recovering from the minor contraction observed in February 2026 when the index dipped to 1.00% with a C- rating. While the current score indicates steady progress, it remains below the robust performance levels recorded during the opening months of 2025 and throughout much of 2023 and 2024, suggesting that while the immediate downward pressure has abated, the ecosystem is still gathering momentum to reach its historical peaks.

A deeper retrospective analysis reveals that the index has experienced significant fluctuations over the last five years, with the current 1.13% sitting comfortably above the historical troughs but well below its highest achievements. The pinnacle of the ecosystem’s performance occurred in February 2023, when the index reached an exceptional 3.00% with an A+ rating, capping off a remarkably strong consecutive run of high marks throughout that entire year. Conversely, the lowest point in the 60-month data set occurred in September 2022, when the index plummeted to 0.60%, receiving an F rating. The current mid-2026 metrics demonstrate that the innovation environment has successfully distanced itself from these historical lows, maintaining a sustainable middle ground that avoids extreme volatility.

Achieving a higher grade and score on the index yields substantial positive outcomes for the regional innovation landscape. Higher ratings, such as the consistent A+ grades observed during most of 2023 and the middle of 2024, signify a thriving environment characterized by robust patent activity, increased entrepreneurial confidence, and a strong influx of research and development funding. These elevated metrics often correlate with heightened economic vitality, as a surge in inventive output attracts venture capital, fosters public-private partnerships, and stimulates high-value job creation. A top-tier grade essentially validates the effectiveness of supportive state policies and academic research institutions, cementing the region’s reputation as a premier hub for technological and intellectual advancement.

In contrast, a decline in the score carries negative implications that can threaten long-term economic resilience. Lower marks, exemplified by the historical D and F grades or the more recent drop to a C- in early 2026, suggest underlying headwinds such as reduced funding, regulatory bottlenecks, or a slowdown in commercialization efforts. When the index falters, it can signal a loss of competitive advantage to neighboring regions, potentially leading to talent braindrain and diminished investor interest. These downward shifts serve as an early warning for stakeholders, highlighting the need for strategic intervention, infrastructural reinvestment, and renewed institutional support to prevent prolonged stagnation within the innovation pipeline.

Discussion:

In June, the Vermont inventionINDEX scored a positive sentiment which was lower than the previous year’s average but 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 Vermont office provides R&D tax credit consulting and advisory services to Burlington, South Burlington, Rutland, Barre and Montpelier

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.