Vermont inventionINDEX September 2026: 1.00% (C- 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 registered a score of 1.00 percent with a C- rating in September 2026, marking a notable drop from August 2026’s robust 1.60 percent score and A+ grade. This current performance equals the July 2026 reading of 1.00 percent and sits well below the historical 60-month average of approximately 1.53 percent. Year-over-year comparisons highlight a significant deceleration, as September 2026 trails September 2025 (1.47 percent, A+), September 2024 (1.60 percent, A+), and the multi-year high of September 2023 (2.60 percent, A+). However, September 2026 remains comfortably above the state’s historical low point of 0.60 percent (F) recorded in September 2022, indicating that while recent momentum has cooled, fundamental innovation activity persists above historical minimums.

Examining the broader 60-month trajectory reveals distinct economic cycles in Vermont’s innovation output relative to its overall GDP growth. The index reached its peak in February 2023 at an exceptional 3.00 percent with an A+ rating, capping an extended surge through 2023 when annual scores averaged over 2.21 percent. Performance remained strong throughout 2024 with an average score of 1.61 percent, despite a brief drop to 0.80 percent (D-) in November 2024. In contrast, 2026 has witnessed a more subdued environment, averaging 1.16 percent year-to-date as monthly ratings have fluctuated primarily between C- and B ranges, contrasting with the dominant A+ ratings of previous years.

Securing higher inventionINDEX scores and top-tier letter grades yields broad economic benefits across Vermont’s business and technology landscape. Grades in the A- to A+ range reflect robust patent production relative to GDP expansion, signaling efficient research and development pipelines and strong intellectual property creation. High ratings instill confidence among institutional investors, attracting venture capital into local startups and encouraging corporate R&D reinvestment. Furthermore, elevated innovation scores enhance the state’s reputation as an emerging technology hub, encouraging talent retention, academic partnerships, and full utilization of programs such as the Vermont R&D tax credit.

Conversely, lower scores and diminished ratings carry negative implications for long-term economic development. Ratings dropping into the C or D ranges, or slipping toward an F grade, indicate potential bottlenecks in research commercialization, declining patent filings, or macroeconomic headwinds impacting local enterprises. Sustained underperformance risks capital drift to rival regional tech centers, reduced corporate R&D spending, and stagnant growth in high-wage technological fields. Reversing lower scores requires targeted public-private support, streamlined commercialization pathways, and strategic investments to re-energize early-stage discovery.

Discussion:

In September, the Vermont inventionINDEX scored a negative sentiment which was lower than the previous year’s average and underperformed the upward trend for the year. This is in contrast 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.