This was a very lonely endeavor, as I appear to have been the only person in this state noting that the official data were incorrect and far too pessimistic. So, while everyone continued to say that Rhode Island was on the verge of a recession, something I too had said until I learned of the possible revisions, I tried in vein to note that this was very far off the mark. And, even if we were to eventually fall to a double-dip recession, presumably based on global weakness or national weakness, at least we would have some margin for error.
Today, the DLT and Governor Chafee released a report confirming substantial future upward revisions to our state's payroll employment data. According to this press release:
"A recent analysis of tax data shows that
This is consistent with what my econometric models had been showing. Ironically, my estimates were a bit too low, as they showed a clear uptrend since October of last year, but to a level below the apparent upward revision. The chart below (click to enlarge) shows the "official" data and my estimates.
Based on this, let me reiterate a few points I have been making over the past several months:
- Rhode Island is not on the verge of a double-dip recession;
- Our state's unemployment rate is not the currently-published 10.9%, but lower, based on the higher payroll employment numbers. My models project a 10.7% rate as of May; and
- As good as these results are, my models agree with the existing data that Rhode Island's labor force has been, and continues to, decline.