MASSACHUSETTS INVENTIONINDEX | SEPTEMBER 2025

September 2025: 1.22% (B grade)

Massachusetts inventionINDEX September 2025: 1.22% (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).

Massachusetts inventionINDEX Scores – Last 12 months

The Massachusetts inventionINDEX for September 2025, at 1.22% with a B grade, indicates a generally positive sentiment, aligning closely with the previous month’s score of 1.21% in August 2025. While this September’s score is slightly lower than the 1.37% recorded in September 2024, it demonstrates a consistent performance within the “B” grade range over the last few months, suggesting a stable, albeit not rapidly accelerating, innovation output for the state. Observing the last 12 months, the index has fluctuated, reaching a high of 1.45% (A+) in December 2024 and a low of 1.10% (C+) in November 2024.

A higher inventionINDEX score and a corresponding higher grade, such as an A or A+, signify robust innovation output, which is generally a strong indicator of economic health and future growth potential. Positive sentiment, anything above a C grade, suggests that the state’s GDP growth is outpacing patent production growth, or at least keeping pace effectively. This can lead to increased investment, job creation, and a more dynamic economic environment, as innovation often drives new industries and enhances productivity across sectors. Such an environment fosters a cycle of progress, attracting talent and further stimulating research and development.

Conversely, a lower inventionINDEX score or a grade below C carries negative implications for the state’s economic outlook. A declining or consistently low score suggests that innovation output is not keeping pace with economic growth, potentially indicating stagnation or a slowdown in technological advancements. This could deter investors, lead to a decrease in R\&D spending, and ultimately impact job growth and overall economic resilience. Prolonged periods of negative sentiment could signal a need for policy interventions to stimulate innovation and ensure the state remains competitive.

Analyzing the 60-month historical data reveals both periods of strong performance, such as October 2023’s 1.92% (A+), and instances where the index dipped, like September 2023’s 1.07% (C+). These fluctuations underscore the dynamic nature of innovation and economic cycles. The current B grade for September 2025, while positive, suggests a steady state rather than a rapid acceleration. Understanding these trends allows for a more informed perspective on Massachusetts’s innovation landscape and its potential trajectory in the broader economic recovery.

Discussion:

In September, the Massachusetts 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 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 Massachusetts office provides R&D tax credit consulting and advisory services to Boston, Worcester, Springfield, Lowell, Cambridge, New Bedford, Brockton, Quincy, Lynn and Fall River.

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.