PROVIDENCE – Rhode Island’s economy expanded for the 16th consecutive month in July and there were hints of an accelerating pace of activity, University of Rhode Island economist and professor Leonard Lardaro said Tuesday.
The Current Conditions Index he produces each month had a year-over-year value of 75 in July. It was the first time in several months it had rose from 67, marking continued expansion.
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A CCI value above 50 indicates expansion, while a value below 50 indicates contraction.
“Rhode Island is indeed in the early stages of recovery from the depths of the pandemic,” Lardaro said, citing improved comparisons to CCI values from two years ago for a fifth consecutive month.
Nine of 12 CCI indicators improved in July year over year, Lardaro said, with retail sales and manufacturing leading the pack. Retail sales rose by double digits and has improved on a yearly basis every month since May 2020. Total manufacturing hours increased 7.3% in July, continuing its climb since February 2021, along with manufacturing wages.
“Strength in manufacturing and retail have propelled Rhode Island throughout most of this recovery,” Lardaro said.
Lardaro said gains in employment-service jobs were the best news of the CCI index, with a small growth of 1.6% after six consecutive months of annual declines.
“Should it sustain an uptrend, this would strongly point to a sustained trend of rising employment,” Lardaro said.
Benefit exhaustions fell by 58% in July, continuing its fall every month since May of last year. New unemployment claims fell 63.1%, another double-digit decrease since July 2021.
The biggest risk ahead is the extent to which Rhode Island’s economy slows due to monetary tightening,” Lardaro said. “How much will retail sales and single-unit permits, the interest-sensitive parts of our economy, slow?”
Year-over-year CCI indicator performance in July:
- Government employment increased 0.3%
- U.S. consumer sentiment declined 36.4%
- Single-unit permits declined 8%
- Retail sales rose 13.8%
- Employment-services jobs increased 1.6%
- Private-services production employment rose 3.4%
- Total manufacturing hours increased 7.3%
- The state’s manufacturing wage rose 5.5%
- The state labor force declined 0.3%.
