CLICK HERE. / " title="LEONARD LARDARO'S Current Conditions Index was 67 in January. Lardaro also published revised values for his index for 2010 based on labor market rebenchmarking. For a larger version of this image, CLICK HERE. /"/>SOUTH KINGSTOWN – “Things are not always as they appear,” said University of Rhode Island economist Leonard Lardaro about his economic index in January, noting that values on the Current Conditions Index for all of 2010 were “substantially higher” due to labor market rebenchmarking.
Prior to the rebenchmarking, CCI values did not reach above 58 in 2010; following the rebenchmarking, the CCI exceeded 58 every month after February, reaching a high of 83 on three occasions.
Lardaro’s index uses a dozen national and local economic indicators to track the state’s economic performance. A reading below 50 indicates economy contraction while above it signifies expansion.
Lardaro cited two of the indicators as the primary reasons for the higher CCI revised values: employment-services jobs and private service-producing employment.
Employment service jobs had failed to improve throughout 2010; following the rebenchmarking, data showed that it improved in every month last year.
Private service-producing employment, which was previously thought to have risen only a few times, improved in 10 of the 12 months.
In January’s CCI reading of 67, eight of the 12 indicators improved. According to the revised numbers, a 67 is still an expansion value but much lower than in December (83) and November (75). It matched the values in September and October.
The four indicators that did not improve were: government employment, single-unit permits, retail sales and benefits exhaustions.
“The revised labor market data and CCI values point to the fact that Rhode Island actually had a fairly ‘typical’ recovery in terms of cyclical momentum,” said Lardaro.
“Our state’s sluggish job growth and stubbornly high jobless rate point to the sad reality that major structural impediments continue to counteract our state’s cyclical momentum, so overall, growth remains unacceptably low. Removing structural impediments should be out job No. 1,” he said.
