R.I.’s current condition? <br>Boffo, says URI prof

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The Ocean State’s health took a U-turn for the better in May, according to University of Rhode Island economist Leonard Lardaro. His Current Conditions Index registered 67 in May, a large increase from April’s 42 and well above the 33 reading in May 2006 (a reading of 50 is considered neutral).
“Acceleration at this juncture is critical,” said Lardaro in a statement accompanying the index’ release, “as our sizeable budget deficits will soon begin to slow our rate of economic growth, not only hurting tax revenue, but causing our deficit to get worse before it gets better.”
Eight of the dozen CCI indicators improved, with the largest jumps coming in U.S. consumer sentiment – up 12 points – single-unit construction permits (+9.6 points), unemployment rate (-7.7 points), and retail sales (+6.3 points).
While the construction permits increase represented a strong improvement, May 2006 was a very weak year, so Lardaro discounted that improvement somewhat. However, the other gains were signs of significant strengthening of the Rhode Island economy.
The unemployment rate in May fell to 4.8 percent when compared with May 2006, even as the labor force grew 0.2 percent – May’s rate, however, was higher than April’s 4.5-percent unemployment. Retail sales showed the highest level of activity since December, while consumer confidence rebounded from three months of declines.
Government employment fell 0.2 percent in May, its eighth consecutive decline, although an increase in private service-producing employment of 1.9 percent more than made up for the loss in jobs.
If there were a cloud on the horizon, it was the fact that unemployment benefit exhaustions increased by 9.3 percent, indicating that there was significant long-term unemployment, while new claims for unemployment insurance, which measures layoffs, increase 3.9 percent.

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