CCI value falls to lowest value in more than 2 years

SOUTH KINGSTON – Falling to its lowest point in 28 months, the October Current Conditions Index declined to a value of 42, shedding 25 points from a September measure, according to University of Rhode Island Economist Leonard Lardaro’s latest report Monday.

In his findings, Lardaro called it the “worst [value] in recent memory.”

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Released Monday, the October 2018 CCI value represents a 50-point fall from the October 2017 value and the eigth month this year in which the CCI value either matched or did not increase year-over-year.

Published monthly, the CCI measures 12 economic indicators that are representative of the economic climate of the state. A value above 50 implies economic expansion, while a value less than 50 indicates contraction.

October’s measure, which is equal to that of June 2016, marks the first time since August 2016 the CCI fell below 50.

“While the third quarter of 2018 was disappointing, the fourth quarter started out in a manner that can only be described as awful,” he said in his findings.

While labor markets between October and December are “most likely” subject to later revision, Lardaro explained, he feels that will not be the case with October 2018 given the slowing pace of European and Asian economies.

Reiterating Rhode Island’s “First In, Last Out” trend concerning recessions, Lardaro floated the question: “Are we in the FI stage?”

In October, five of the CCI’s 12 indicators saw improvement, nearly half of the eight which saw positive results in September.

• The timeliest measure of layoffs, new claims jumped by 11.3 percent in October – its third increase over the past five months.
• A 1.3 percent gain was witnessed by private-service producing employment in October.
• In its first decline since March, a 0.2 percent dip in total manufacturing hours was recorded in October.
• The manufacturing wage fell by 1.8 percent in October.
• Reflective of new home construction, in its fifth “recent” decline, said Lardaro, October saw single-unit permits fell by 1.9 percent.
• Employment service jobs fell by 0.9 percent in October after two consecutive gains in September and August.
• A 1.9 percent decline in U.S. consumer sentiment was measured in October.
• Retail sales jumped 3.6 percent in October.
• Government employment fell 0.5 percent in October.
• The most timely measure of longer-term unemployment, benefit exhaustions, fell by 8.3 percent in October.
• Rhode Island’s labor force dipped by 0.9 percent in October.
• The October seasonally adjusted unemployment rate was 3.8 percent, 0.7 percentage point dip year-over-year.

Emily Gowdey-Backus is a staff writer for PBN. You can follow her on Twitter @FlashGowdey or contact her via email, gowdey-backus@pbn.com.