TEXAS INVENTION INDEX – MARCH 2025

The Invention Index measures a country’s or state’s innovation output by comparing GDP growth with patent production growth. 

Texas Invention Index March 2025: 1.10% (B- grade)

Texas Invention Index over the last year:

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).

Analysis

Comparison with Previous Months:
The Invention Index score for March 2025 (1.10%) represents a decrease from February 2025 (1.15%) and a notable drop from January 2025 (1.27%). March’s score matches the November 2024 level, which also stood at 1.10%. This suggests a downward trend in the past two months following a brief peak in January.

Long-Term Trends:
Over the six-month period from September 2024 to March 2025, the scores fluctuate within a relatively narrow range (1.10% to 1.31%). The overall trajectory shows alternating increases and decreases without a strong consistent upward or downward trend. This indicates a somewhat stable but mildly volatile performance.

Significant Changes:
October 2024 saw the highest score (1.31%), marking a sharp increase from the prior month (1.15% in September). Another notable rise occurred in January 2025 (1.27%), following a slight dip in December. Conversely, March 2025’s score reflects a continued decline from the January peak, suggesting some potential loss in momentum.

Contextualizing the Data:
The March 2025 score is at the low end of the spectrum, matching November 2024’s figure. Given this repetition and the two-month decline, March’s figure may be part of a downward trend rather than an isolated fluctuation. However, due to prior rebounds seen after low months, it’s not definitive without further data.

Discussion:

In March, the Texas Invention Index scored a positive sentiment which was lower than the previous year’s average and underperformed the downward trend for the year. This is in contrast to the prior 12 months, which experienced an upward trend. As the world continues to recover from the height of the Covid-19 pandemic, it is unclear if there is any backlog of applications awaiting approval or if the department has fully caught up. If approvals are not yet caught up, we may see a decrease in approvals – and a reduced Invention Index – in the coming months/years as the state feels the full economic impact of companies closing and/or being forced to minimize their staffing and therefore minimize their R&D work hours.

Learn more about the Invention Index here.

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 contact a Swanson Reed R&D Specialist today or check out our free online eligibility test.

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Swanson Reed is one of the U.S.’ largest Specialist R&D tax advisory firms. We manage all facets of the R&D tax credit program, from claim preparation and audit compliance to claim disputes.

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