NORTH DAKOTA INVENTIONINDEX | AUGUST 2025

August 2025: 1.02% (C+ grade)

North Dakota inventionINDEX August 2025: 1.02% (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).

North Dakota inventionINDEX Scores – Last 12 months

The North Dakota inventionINDEX for August 2025 stands at 1.02%, earning a C+ grade. This score indicates a neutral to slightly positive sentiment regarding the state’s innovation output, which is measured by comparing GDP growth with patent production growth. When looking at the preceding months, August’s score represents a dip from July’s strong A+ grade of 1.16% and also falls below the A- grade of 1.06% seen in June. This suggests a recent deceleration in the state’s innovation performance compared to its immediate past.

A consistently higher inventionINDEX score and a corresponding A or B grade signify a robust innovation ecosystem. Such positive sentiment indicates that economic growth is effectively being translated into, or is accompanied by, a healthy increase in patent production. This scenario often correlates with a dynamic economy, attracting investment, fostering job creation in high-tech sectors, and signaling strong potential for future economic recovery and resilience, particularly in the face of economic challenges like a pandemic. States with consistently high grades are generally perceived as leaders in innovation.

Conversely, lower inventionINDEX scores, especially those dipping into the C or D grades, signal a potentially negative outlook for innovation. While August 2025’s C+ is still considered positive, a trend of declining scores or persistent lower grades implies that the relationship between GDP growth and patent production is weakening. This could suggest stagnation in innovation, reduced research and development activities, or a less favorable environment for new ideas to translate into tangible intellectual property. Such trends can be indicative of economic headwinds, reduced investment in innovation, or a less competitive landscape for new businesses and technological advancements.

Over the last 60 months, the North Dakota inventionINDEX has exhibited fluctuations, moving between strong A+ grades and more moderate C+ or B grades. While August 2025’s C+ is not the lowest observed, it is important to consider its position within the broader historical context. Observing these trends over time allows for a deeper understanding of the state’s long-term innovation trajectory and its capacity to adapt to economic shifts. Sustained improvement in the inventionINDEX reflects a thriving innovative climate, which is essential for continued economic progress and adaptability.

Discussion:

In August, the North Dakota inventionINDEX scored a positive sentiment which was lower than the previous year’s average and 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 North Dakota office provides R&D tax credit consulting and advisory services to Fargo, Bismarck, Grand Forks, Minot, and West Fargo.

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.