The Lardaro Report: Rhode Island’s economy was ‘back to neutral,’ showed positive signs out of recession

Rhode Island’s economic performance for September was a move back to neutral, however several signs point to the local economy being a bit better than they appear, according to University of Rhode Island economist Leonard Lardaro.

September’s CCI value, at 50, matched the marks set in July, April and January. Lardaro suggests there is some underlying momentum that could finally break Rhode Island out of the sub-par range the state found itself in this year. Lardaro’s overall assessment that Rhode Island is in a recession is unchanged. He notes the only question is how long it may last.

For September, six of the 12 economic indicators improved relative to a year ago. However, only two of the five leading economic indicators improved. Total Manufacturing Hours grew at 5%, which Lardaro considers very healthy as both employment and the workweek expanded. Manufacturing Wage also increased by 1.8%—Lardaro calls its recent performance “choppy but strengthening.â€

Employment Service Jobs, a leading labor market indicator, rose sharply in September by 3.5%. US Consumer Sentiment again declined by a double-digit rate, down by 21.4%—continuing its consistent monthly declines—Lardaro says.

Retail Sales, a critical economic indicator that has been a strength through almost the entire post-pandemic period, rose by only 2.2%, about half of August’s growth rate. New Claims, which is related to layoffs, increased by 3.5% and sustained its upper trend. Benefits Exhaustion, which indicates long-term unemployment, rose in September by 32.7%, sustaining accelerating increases since June, Lardaro says.

Despite declines in federal employment, Government Employment rose 0.5%. Private Service-Producing Employment, a proxy for service-sector employment, barely rose in September, 0.4%, Lardaro says.

Noted the First In – Last Out of recession compares Rhode Island with one other state – that being West Virginia.