Home Economy Economic Activity Lardaro: R.I. remains in a recession

Lardaro: R.I. remains in a recession

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PBN Staff

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01/07/2026

Lardaro-1-1-1 — RHODE ISLAND remains in a recession, University of Rhode Island economist and professor Leonard Lardaro said Wednesday in his monthly Current Conditions Index report. / PBN FILE PHOTO/MICHAEL SALERNO

PROVIDENCE – Rhode Island remains in a recession, University of Rhode Island economist and professor Leonard Lardaro said Wednesday in his monthly Current Conditions Index report. The index had a contractual value of 33 in October, down from the neutral value of 50 posted in September. A CCI value above 50 indicates an economic expansion while a value below 50 indicates economic contraction. Lardaro said Rhode Island is in a recession because its economy

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PROVIDENCE – Rhode Island remains in a recession, University of Rhode Island economist and professor Leonard Lardaro said Wednesday in his monthly Current Conditions Index report. The index had a contractual value of 33 in October, down from the neutral value of 50 posted in September. A CCI value above 50 indicates an economic expansion while a value below 50 indicates economic contraction. Lardaro said Rhode Island is in a recession because its economy has been unable to break past the CCI neutral value of 50. “A recession is defined based on the sustainability of overall economic activity, not levels. Nor is it defined as two consecutive quarters where real GDP [Gross Domestic Product] is rising, as even this is complicated by future data revisions,” Lardaro said. “At this point, the primary issue continues to be how long we will remain in a recession. Unfortunately, our fate rests largely in the hands of monetary and fiscal policy, both of which we have no control over. Upcoming data revisions promise to be very interesting.” Lardaro’s conclusion differs from that of the Rhode Island Public Expenditure Council. In their quarterly report with the Center for Global and Regional Economic Studies at Bryant University released on Dec. 18, RIPEC concluded the state is in a not in recession despite mixed economic signals in the third quarter. Edinaldo Tebaldi, professor of economics and vice president of strategy at Bryant University added that, “economists have often called recessions too early or too often.” Michael DiBiase, CEO and president of RIPEC, said “Rhode Island’s economy showed a welcome easing in the unemployment rate and modest gains in resident employment in Q3. These are encouraging signs and point to a degree of stability in the state’s economy. However, continued weakness in labor force participation, the decline in Rhode Island-based jobs, and stronger regional and national performance in unemployment and GDP indicate that Rhode Island’s trajectory still merits close watch." Lardaro, however, doubled down on his October and December calls that R.I. is in a recession. October, he says, was disappointing on several counts. Only four of the 12 CCI indicators improved year over year. Of the five leading indicators, only total manufacturing hours grew 4.9% from October 2024 following a 5% year over year improvement in September. Private service-producing employment and the unemployment rate both barely improved year over year, Lardaro said. Though the private service-producing employment grew a meager 0.1%, that sector’s growth rate has remained below 1% since February. New claims, which Lardaro relates to layoffs, increased 4.1% year over and employment service jobs, fell 1% after improving in September. Retail sales fell 6% year over year in October, the first drop for that sector since February, Lardaro said. Benefit exhaustions, which Lardaro said is reflective of longer-term unemployment, failed to improve for the third consecutive month, rising 12.8% in October. “October was not a pretty month for Rhode Island’s economy,” Lardaro said. “We have clearly reaffirmed our FI [First In] status, although there is consolation in the fact that at least this time we are tied for first.” Year-over-year CCI indicators in October:

Employment-service jobs decreased by 1%.

Government employment decreased by 1.5%.

Labor force decreased by 0.2%.

Total manufacturing hours increased by 4.9%.

Manufacturing wages decreased by 0.4%.

New unemployment claims increased by 4.1%.

Private-service-producing employment increased by 0.1%.

Retail sales decreased by 6%.

Single-unit permits decreased by 22%.

Unemployment benefit exhaustions increased by 12.8%.

Unemployment rate decreased by 0.1%.

U.S. consumer sentiment decreased 23.7%.