PROVIDENCE – Rhode Island’s Current Conditions Index remained at a value of 58 in May, showing no change from the two previous months, but prompting tentative confidence in the state’s economy from University of Rhode Island economist Leonard Lardaro.
“As of May, I do not believe Rhode Island has entered into any stage of recession, but based on its recent tepid economic performance, we aren’t that far away from a recession either,” Lardaro said in a report released Monday. “So while we appear to have a reprieve for now at least, there remains cause for concern.”
Values have remained steady since March, when the CCI rebounded from a low of 33 in February to its current value of 58. A value above 50 indicates expansion, while a value below 50 indicates contraction.
Still, May’s CCI index dropped 42 points year over year. It is the 12th consecutive month to fail to exceed its CCI value of the year before.
Although seven of the 12 indicators that comprise the CCI have improved, the only sector that can claim significant strength is retail sales, which Lardaro calls the state’s “star” indicator. Retail shows a 7.7% year-over-year increase, down slightly from April’s 9.9% year-over-year increase.
Even so, Rhode Island’s economy has “largely been flat since 2015,” Lardaro says, noting that his assessment is not related to the state’s last-place ranking in CNBC’s recent 2019 America’s Top States for Business report.
Lardaro attributes Rhode Island’s fall from 45 last year Univeto 50 this year to “extremely discouraging data revisions we received recently” and takes issue with its criteria and weightings, including the state’s ranking 28th place ranking for quality of life.
“I refuse to believe that the quality of life in Rhode Island is below the national average,” he said.
CCI indicator changes year over year in May:
- Government employment decreased 0.2%
- U.S. consumer sentiment increased 2.1%
- Single-use permits decreased 8.2%
- Retail sales increased 7.1%
- Employment service jobs increased 0.1%
- Private service-producing employment increased 0.5%
- Total manufacturing hours decreased 7.8%
- Manufacturing wage increased 1.5%
- State labor force decreased 0.6%
- Benefit exhaustions increased 1.4%
- New claims decreased 4.3%
- Unemployment fell by 0.4%
