PENNSYLVANIA INVENTIONINDEX | SEPTEMBER 2025

September 2025: 1.15% (A- grade)

Pennsylvania inventionINDEX September 2025: 1.15% (A- 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

The Pennsylvania inventionINDEX for September 2025 stands at 1.15%, earning an A- grade. This score is consistent with the previous month’s A- rating in April 2025 and is slightly above the 1.14% recorded in September 2024. Over the last 60 months, the index has shown fluctuations, with notable highs such as 1.48% in September 2023 and 1.30% in January 2024, both achieving an A+ rating. Conversely, periods like November 2024 and December 2021 saw scores as low as 1.00% (C grade) and 1.03% (C+ grade) respectively, indicating variations in innovation output over time.

A higher inventionINDEX score and a corresponding higher grade, such as an A+ or A, signify robust innovation output and a positive economic sentiment for Pennsylvania. This indicates that the state’s GDP growth is favorably aligned with its patent production growth. Such positive trends are often associated with increased investment in research and development, a thriving entrepreneurial ecosystem, and a strong capacity for economic recovery and resilience, particularly in the face of broader economic challenges. These periods suggest a dynamic environment conducive to new ideas and technological advancements.

Conversely, a lower inventionINDEX score, particularly those falling into the C or B- range, suggests a less favorable outlook. A score below a C grade indicates negative sentiment. These periods may reflect slower economic growth, reduced patent activity, or challenges in translating innovative efforts into tangible economic benefits. Such implications could point to a need for policy interventions, increased support for innovation, or addressing underlying economic factors that might be hindering the state’s inventive capacity and overall economic health.

Analyzing the historical data reveals that while September 2025’s A- grade is positive, it is important to consider the broader trends. The index has demonstrated periods of strong performance, particularly in the earlier years of the 60-month span, with several A+ ratings. However, there have also been instances of moderation. Understanding these comparisons allows for a more nuanced perspective on Pennsylvania’s innovation landscape, highlighting both its strengths and areas where sustained focus on fostering innovation and economic growth may be beneficial.

Discussion:

In September, the Pennsylvania inventionINDEX scored a positive sentiment which was higher than the previous year’s average but 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.