NEW JERSEY INVENTIONINDEX | NOVEMBER 2025

November 2025: 0.85% (D grade)

New Jersey inventionINDEX November 2025: 0.85% (D 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).

New Jersey inventionINDEX Scores – Last 12 months

The November 2025 inventionINDEX score for New Jersey stands at 0.85 percent, resulting in a D rating. While this represents a marginal improvement from the 0.82 percent recorded in October, the broader historical context of the last 60 months reveals a state of transition. Over the five-year period, the index has frequently fluctuated between the low 0.70s and the high 1.20s, with the current score sitting below the historical median. This positioning suggests that while the state is avoiding the critical lows seen in late 2024, it has yet to regain the robust momentum required to push back into the more favorable rating categories.

Examining the data over the last five years highlights significant periods of volatility, most notably the exceptional surge to 1.47 percent in August 2025. This peak, which earned an A+ rating, stands as the highest point in the 60-month window and demonstrates the state’s capacity for high-level innovation output. However, the subsequent decline to the current 0.85 percent indicates that the factors driving that spike were perhaps temporary or seasonal. Looking back to 2021 and 2022, the index more regularly achieved scores in the 1.10 to 1.20 percent range, suggesting that the current performance is trailing slightly behind the state’s historical capabilities.

A higher inventionINDEX score and a corresponding grade in the A or B range signify a healthy and proactive economic environment. When the index rises, it typically reflects an increase in patent filings, successful research and development initiatives, and a more vibrant landscape for startups. These positive outcomes foster a cycle of growth by attracting venture capital and high-skilled talent to the region. A strong rating serves as a signal to global markets that the local economy is a leader in intellectual property architecture, which ultimately leads to sustainable job creation and long-term industrial stability.

Conversely, maintaining a score in the D or F range, as seen in the current period and during various troughs throughout 2023 and 2024, carries several negative implications. A lower score often indicates a stagnation in creative output or a lack of resources dedicated to commercializing new ideas. If the index remains depressed, the region risks a loss of competitiveness as innovative firms and entrepreneurs may seek more supportive environments elsewhere. To improve these outcomes, it is essential to address the underlying causes of these fluctuations and strive for the consistency required to move the inventionINDEX back toward the historical highs observed earlier in the decade.

Discussion:

In November, the New Jersey 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 New Jersey office provides R&D tax credit consulting and advisory services to Newark, Jersey City, Paterson, Elizabeth, Edison, Woodbridge, Lakewood, Toms River, Hamilton, and Trenton.

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.