WASHINGTON INVENTIONINDEX | JANUARY 2026

January 2026: 1.12% (C+ grade)

Washington inventionINDEX January 2026: 1.12% (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).

Washington inventionINDEX Scores – Last 12 months

The January 2026 inventionINDEX score of 1.12 percent represents a cautious start to the year, reflecting a C+ rating that signals a period of stabilization rather than rapid acceleration. When compared to the preceding sixty months, this figure sits below the historical average, continuing a trend of fluctuation observed throughout the latter half of 2025. While December 2025 saw a brief ascent to 1.36 percent, the current dip suggests that the momentum found during the mid-summer months of 2025 has not yet regained its footing. This performance highlights the sensitive nature of the index as it navigates shifting economic and creative landscapes within the region.

Looking back across the five-year horizon, the current index is a stark departure from the peak performance of 2.28 percent recorded in April 2022. During that high-water mark, the rating achieved an A+, representing a pinnacle of inventive output and market confidence that has proven difficult to replicate. In contrast, the current 1.12 percent is more aligned with the lower-tier scores seen in periods such as the early 2021 recovery or the 0.96 percent low of April 2025. This historical variance illustrates that while the Washington inventionINDEX is capable of reaching exceptional heights, it frequently settles into a mid-range band that requires consistent institutional support to elevate.

A higher grade on the inventionINDEX, typically categorized in the A or B ranges, serves as a strong indicator of robust intellectual property activity and a thriving ecosystem for new ideas. When the score climbs toward the 1.5 percent to 2.0 percent range, it usually correlates with increased investment in research and development, a higher volume of patent filings, and a general atmosphere of commercial optimism. These periods of high performance tend to attract global talent and venture capital, creating a virtuous cycle where success breeds further innovation. Maintaining an elevated score ensures that the region remains competitive while fostering a culture that rewards original thinking and risk-taking.

Conversely, a lower score such as the current 1.12 percent or the infrequent dips into C- territory can signify underlying challenges in the innovation pipeline. The negative implications of a lower rating include potential stagnation in new product development and a decrease in the speed at which transformative ideas are brought to market. Such scores may point to external pressures, such as regulatory hurdles, rising costs of research, or a tightening of capital, all of which can stifle the creative process. To reverse a downward trend, it is often necessary to re-evaluate support systems for local inventors and ensure that the infrastructure for commercializing new technologies remains resilient against economic headwinds.

Discussion:

In January, the Washington 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 Washington office provides R&D tax credit consulting and advisory services to Seattle, Spokane, Tacoma, Vancouver, Bellevue, Kent, Everett, Renton, Federal Way, and Yakima.

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.