SOUTH KINGSTOWN – Momentum in Rhode Island’s rate of economic growth continued a troublesome slowdown in November, according to the Current Conditions Index produced by University of Rhode Island economist Leonard Lardaro.
Released Monday, the index registered 67 in November, eight points below the October figure of 75 and 16 points below November 2012’s index reading of 83.
Eight of 12 indicators improved, however. These included single-unit housing permits, retail sales, private service-producing employment, total manufacturing hours (a continued bright spot), manufacturing wages, unemployment benefit exhaustions, new claims for unemployment and the unemployment rate.
The Current Conditions Index measures the state’s economic performance, or momentum, over a dozen metrics. A CCI greater than 50 indicates progress, while a value less than 50 signals setbacks. The economist seasonally adjusts each indicator, and then compares its monthly value with that of the same month a year ago to determine whether or not each one and the overall economic climate has improved.
Contrasting 2013 through November with the same period in 2012, Lardaro observed that, for a fourth consecutive month and the fifth time in six months, the index has failed to surpass its rate of growth in the previous year.
“What we are continuing to witness is a slowing in our rate of growth to the end of last year,” Lardaro reported. “The ultimate test of how robust this recovery proves to be will be defined by our ability to accelerate from current rates of growth.”
Among the good news, total manufacturing hours, which measure the strength in the sector, rose by 5.6 percent year over year in November, driven by an increase in the length of the work week – an improvement reflected over 11 of the past 13 months, he wrote. New claims for unemployment also fell 26.9 percent, and single-unit housing permits rose 30 percent year over year.
Less favorable were a sharp drop in U.S. consumer sentiment, down 9.4 percent, the third consecutive monthly decline, and employment service jobs, which dropped 1.3 percent, the second time in more than a year that it has decreased, he said.
“Our state’s recovery has become somewhat less broadly based,” Lardaro observed. The four-month slowdown is “not a very happy way to end the year,” he added, but in spite of that, the state should benefit from the accelerating pace of national economic activity in 2014.