PENNSYLVANIA INVENTIONINDEX | AUGUST 2025
August 2025: 1.12% (B+ grade)
Pennsylvania inventionINDEX August 2025: 1.12% (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).
Pennsylvania inventionINDEX Scores – Last 12 months
| Month | inventionINDEX Score |
| August 2025 | 1.12% |
| Jul 25 | 1.21% |
| Jun 25 | 1.07% |
| May 25 | 1.19% |
| Apr 25 | 1.15% |
| Mar 25 | 1.10% |
| Feb 25 | 1.11% |
| Jan 25 | 1.13% |
| Dec 24 | 1.12% |
| Nov 24 | 1.00% |
| Oct 24 | 1.20% |
| Sep 24 | 1.14% |
| Aug 24 | 1.05% |
The Pennsylvania inventionINDEX for August 2025 stands at 1.12%, earning a B+ rating. This score, while indicative of positive sentiment as it is above the C grade threshold, shows a slight decrease compared to the previous month’s A+ rating of 1.21% in July 2025. When examining the scores over the last 12 months, August 2025’s score aligns with several months holding a B+ or similar rating, suggesting a consistent, though not always top-tier, performance within the recent year.
A higher inventionINDEX score and corresponding grade, such as an A or A+, signifies robust innovation output. This indicates that GDP growth is aligning favorably with patent production growth, a sign of a thriving innovative ecosystem. Such strong performance can attract investment, foster new businesses, and lead to job creation, contributing significantly to economic recovery and long-term prosperity. A consistently high score suggests a dynamic and inventive state economy, capable of adapting and growing.
Conversely, a lower inventionINDEX score, especially one falling below the C grade, signals negative sentiment and potential challenges in innovation output. This could imply that patent production growth is not keeping pace with GDP growth, or perhaps that both are lagging. A sustained period of lower scores might deter potential investors, slow down economic development, and could reflect underlying issues in research and development capabilities or a less conducive environment for innovation.
Observing the historical data, the Pennsylvania inventionINDEX has experienced fluctuations over the past 60 months, demonstrating periods of strong A+ ratings and times when it dipped to C+ or B- grades. This varied performance underscores the dynamic nature of innovation and economic indicators. Understanding these trends is crucial for predicting economic recovery and for assessing the overall health and innovative capacity of the state.
Discussion:
In August, the Pennsylvania inventionINDEX scored a positive 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 Pennsylvania office provides R&D tax credit consulting and advisory services to Philadelphia, Pittsburgh, Allentown, Erie, Reading, Scranton, Bethlehem, Lancaster, Harrisburg, Altoona, York, State College, Wilkes Barre, Chester, Williamsport, Easton, Lebanon, Hazleton, New Castle and Johnstown.
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.
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What is the R&D Tax Credit?
The Research & Experimentation Tax Credit (or R&D Tax Credit), is a general business tax credit under Internal Revenue Code section 41 for companies that incur research and development (R&D) costs in the United States. The credits are a tax incentive for performing qualified research in the United States, resulting in a credit to a tax return. For the first three years of R&D claims, 6% of the total qualified research expenses (QRE) form the gross credit. In the 4th year of claims and beyond, a base amount is calculated, and an adjusted expense line is multiplied times 14%. Click here to learn more.
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Swanson Reed is one of the only companies in the United States to exclusively focus on R&D tax credit preparation. Swanson Reed provides state and federal R&D tax credit preparation and audit services to all 50 states.
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