VERMONT INVENTIONINDEX | AUGUST 2025

August 2025: 1.47% (A+ grade)

Vermont inventionINDEX August 2025: 1.47% (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).

Vermont inventionINDEX Scores – Last 12 months

The Vermont inventionINDEX for August 2025, at 1.47% with an A+ grade, demonstrates a consistent positive sentiment when viewed against its recent history. This score aligns with July 2025, suggesting a stabilization in innovation output. While this current reading is lower than the average from the previous year, it indicates a strong foundation for continued innovation. This trend highlights Vermont’s sustained commitment to fostering an environment conducive to intellectual property growth, which is a key indicator of economic vitality.

A higher inventionINDEX score and a favorable grade like A+ signify robust innovation and a healthy economic outlook. A strong performance in this index suggests an increase in patent production relative to GDP growth, indicating that the state is effectively converting economic activity into tangible intellectual assets. This can lead to increased investment, job creation, and a more diversified economy, enhancing Vermont’s attractiveness for businesses and innovators. Such positive indicators also reflect well on the effectiveness of R\&D initiatives and the overall economic resilience of the state.

A lower inventionINDEX score or a poorer grade, such as the D- seen in November 2024 or the F in September 2022, would signal a decline in innovation output. This could imply a stagnation or reduction in research and development activities, potentially leading to a less competitive economic landscape. A sustained period of lower scores might suggest challenges in economic recovery, a decrease in new business ventures, or a reluctance to invest in innovative projects. These implications underscore the importance of monitoring the inventionINDEX as a barometer for economic health and future growth potential.

Observing the historical data for the last 60 months reveals fluctuations, yet Vermont has largely maintained a positive sentiment, with many months achieving an A+ grade. The periods of lower scores, such as the D grades in 2021 and 2022, serve as reminders of potential vulnerabilities to economic shifts or other external factors. The consistent return to higher grades, as seen in the latter part of the record, underscores Vermont’s capacity for recovery and sustained innovation. This continuous monitoring of the inventionINDEX provides valuable insights into the state’s economic trajectory and its ability to adapt and grow.

Discussion:

In August, the Vermont inventionINDEX scored a positive sentiment which was lower than the previous year’s average but outperformed the downward trend for the year. This is similar to the prior 12 months, which experienced a considerable 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 Vermont office provides R&D tax credit consulting and advisory services to Burlington, South Burlington, Rutland, Barre, and Montpelier.

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.