September’s economic data were more positive than the CCI’s value of 58 would appear to indicate. On a monthly basis, eleven of the twelve CCI indicators either improved or were close to improving. Once again, strength in our state’s manufacturing sector led the way, as its rebound continued. Total Manufacturing Hours rose again (+0.9%), powered by yet another sharp increase in the length of the workweek. This indicator has now improved for the last three months, something Rhode Island hasn’t seen since the year 2000. Along with this improvement in Total Manufacturing Hours, the Manufacturing Wage rose gain by a greater than 4 percent rate (+4.2%). The other part of our goods producing sector (Mining doesn’t matter here), Single-Unit Permits, which reflects new home construction, continued its recent roller coaster behavior, rising by 16 percent compared to last September. As noted earlier, Retail Sales failed to improve in September, declining by 2.7 percent compared to a year ago, its first decline in the last eight months. Along with this, US Consumer Sentiment fell (-7.5%), breaking a string of seventeen consecutive improvements.
Our state’s Labor Force rose again, increasing by 0.2 percent compared to a year ago. While our Unemployment Rate fell to 11.5 percent from August’s value of 11.8, this was once again at least partially the result of monthly declines in our Labor Force. Benefit Exhaustions, which reflects long-term unemployment, fell sharply again, dropping by 31.2 percent in September, its seventh consecutive improvement. New Claims, a leading indicator that measures layoffs, fell by 2.4 percent versus last September, further erasing the effects of recent consecutive increases. While Employment Service Jobs, another leading labor market indicator, fell by 11.6 percent compared to a year ago, on a monthly basis, this indicator appears to have plateaued since June. Stabilization in this indicator will be critical to sustaining Rhode Island’s newly found recovery momentum. Private Service-Producing Employment fell again (-1.2%), with its rate of decline accelerating slightly in September. Finally, Government Employment declined in September, by 0.2 percent, fueled largely by a decrease in local non-education employment. While visual examination of the data for this indicator seems to show a leveling off, Rhode Island’s persistent deficit woes coupled with the likely absence of any future help from the federal government should cause its eventual deterioration.
THE BOTTOM LINE: