April 2016 Employment: The Rut of April Mud


The latest employment data from the Bureau of Labor Statistics (BLS) appears to be positive, with 444 more working Rhode Islanders and a slight increase in the labor force, which was just enough to bring the unemployment rate down by one-tenth of a percentage point with rounding, to 5.3%.  The number of jobs based in state, however, fell by 1,500, and that’s after the numbers for March were revised down by 300, meaning that the drop from last months reported number was 1,800.

As the following chart shows, even the employment data isn’t as encouraging as the change in the unemployment rate might make it seem.  Basically, employment in Rhode Island is flat and has been for almost a year.


In the context of its neighbors, this stagnation turns into a negative.  Both Massachusetts and Connecticut have seen strong growth after having slipped for much of last year.


This relative negativity is true when looking across the nation, as well.  Rhode Island remains one of on three states with an employment level that is less than 96% of its size at each state’s peak.  At this point, the Ocean State is one of only 13 states that haven’t recovered 100% of its pre-crisis peak.

Once again, we note that Michigan — long Rhode Island’s company at the back of the pack on this chart — continues to move up the scale, having implemented right-to-work policies.


The next chart shows the employment numbers in relation to jobs based in the state.  Since the end of the employment crash in 2009, jobs based in Rhode Island (that is, people from anywhere working as employees for other people in Rhode Island) have slowly increased (light area), while employment (that is, Rhode Islanders who say they have work, wherever it is) has been more erratic.

The larger number — the one that hasn’t budged in about a year — would include Rhode Islanders who are working in other states, which is odd, because our Southern New England neighbors have seen employment growth, which should have translated into some increase of border-crossing Rhode Island workers.  Perhaps the more significant consideration, though, is that the employment number includes people who are self employed or who own businesses.

Stagnation, therefore, may very well indicate a dearth of self-starters and innovators in the Rhode Island economy, suggesting that Democrat Governor Gina Raimondo’s emphasis, with the help of the Brookings Institution, on an “innovation economy” is not bearing fruit.


Finally, with the RI Center for Freedom & Prosperity changing its monthly employment report into a monthly Jobs & Opportunity Index (JOI) brief, we’ve moved the chart showing the official unemployment rate in comparison with what it would have been had Rhode Islanders not given up and left the labor force.  Under that assumption, the state would have been hovering around 9% unemployment for the last year, although just edging down to 8.9% in April.