RI Economist Report says State Continues to Climb Out of Economic Recession – Leonard Lardaro

R.I. continues to climb out of economic recession, says URI economist

Rhode Island’s economic performance for July has exceeded what aggregate numbers indicate, providing further evidence that the state is in the early stages of emerging from a shallow recession, according to University of Rhode Island economist Leonard Lardaro.

July’s Current Conditions Index value of 50 marks the fourth time in the last five months that a monthly CCI showed at least 50, which is a neutral value, or better.

Lardaro says the state finds itself in a period where economic indicators show substantial strength, while those that fail to improve are only doing so by a small amount.

While it is common for an improving economy to have moments of pause, such as what was seen in July, Lardaro says there is room for continued optimism for Rhode Island’s economic health if the underlying momentum continues.

Six of the CCI’s 12 economic indicators improved in July relative to a year ago.

Retail Sales, a critical economic indicator that has been a strength through the post-pandemic period, grew by 4.5%. Total Manufacturing Hours continued its growth, increasing by 7.5%. Manufacturing Wage also grew by 0.7%—showing increases in three straight months.

Single-Unit Permits, related to new home construction, saw another substantial increase, rising by 37.3%. Benefits Exhaustion, which indicates long-term unemployment, decreased by 5.1%—improving for the sixth time in the last seven months.

The Unemployment Rate dropped by 0.3% in July; however, Lardaro says data revisions in February are needed to see a more accurate picture on the true rate.

Employment Service Jobs, a leading labor market indicator, fell by 6.4% in July. U.S. Consumer Sentiment continued its consistent monthly declines, dropping by 10.8%, Lardaro says.

Government Employment also fell by 2.4%, attributed to declines in federal government employment, Lardaro says, while Private Service-Producing Employment, a proxy for service-sector employment, dropped by 0.1%.

Current Conditions Index-July 2026

The information included in the report has a summary and charts prepared by Lardaro, who will be blogging about the new labor data during the coming weeks.

The Current Conditions Index, created by Lardaro, measures the strength of the present economic climate in Rhode Island by following the behavior of 12 indicators.