Home Economy Economic Activity Lardaro: January troubling for R.I.’s economy

Lardaro: January troubling for R.I.’s economy

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PBN Staff

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03/17/2025

Lardaro-1-1-1 — JANUARY's economic indicators were showing troubling signs for Rhode island, according to University of Rhode Island economist and professor Leonard Lardaro. / PBN FILE PHOTO/MICHAEL SALERNO

PROVIDENCE – January was troubling for Rhode Island’s economy, University of Rhode Island economist and professor Leonard Lardaro said Monday in his monthly Current Conditions Index report. The index, which Lardaro publishes each month, had a neutral value of 50 while half of its economic indicators failed to improve from December. A CCI value above 50

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PROVIDENCE – January was troubling for Rhode Island’s economy, University of Rhode Island economist and professor Leonard Lardaro said Monday in his monthly Current Conditions Index report. The index, which Lardaro publishes each month, had a neutral value of 50 while half of its economic indicators failed to improve from December. A CCI value above 50 indicates an economic expansion while a value below 50 indicates economic contraction. Lardaro said newly revised labor market data for 2024 also dropped most of the CCI's previously published values in the second half of 2024. “Last month I wrote that: ‘The Current Conditions Index … continues to perform fairly well.’” That assessment was based on the earlier labor market data, Lardaro said. “Recently, the revised data for 2024 and new 2025 data were released. While in the aggregate these revisions seemed fairly innocuous, certainly not as negative as had been the case in the recent past, several individual indicators were dramatically changed.” Lardaro explained that the revised CCI values showed Rhode Island peaked in June at 75 and fell off a bit through September when it plateaued at 67. Lower values followed after before hitting the neutral 50 in both December and January. (Before the revision, December had a value of 67.) “It’s still too soon to make this definitive conclusion, but things don’t look too promising right now," Lardaro said. Six of the 12 CCI indicators improved in January. The state’s labor force continued its upward trend; however, it stagnated on a monthly basis. Total manufacturing hours declined for the second consecutive month while manufacturing wages fell for the fourth straight month as well. Retail sales, which Lardaro said is a key indicator of the state’s economic health, rose 2.8% in January. “Should it weaken, that’s when we really have to begin worrying,” Lardaro said. New unemployment insurance claims fell in January but the indicator still lacks a defined trend in either direction, Lardaro said. Meanwhile, benefit exhaustions, which reflect long-term unemployment, improved for the first time since January 2024. “Given the upward revisions to our state's population 16 and older, the employment rate [percent of the population employed] declined annually for every month since last June, which is a very negative statistic,” Lardaro said. Year-over-year CCI indicators in January:

Employment service jobs decreased by 5.1%.

Government employment increased by 3.6%.

Labor force decreased by 0.7%.

Total manufacturing hours decreased by 0.7%.

Manufacturing wages decreased by 1.3%.

New unemployment claims decreased by 3.5%.

Private service-producing employment increased by 2%.

Retail sales increased by 2.8%.

Single-unit permits decreased by 1.3%.

Unemployment benefit exhaustions decreased by 2.5%.

Unemployment rate increased by 0.7%.