July 2018 Employment: Strong Economy Lifting RI… at a Discount

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National employment growth continues to be strong, and Rhode Island is benefiting from that tide.  The increase in the number of Rhode Islanders who say that they are employed, from June to July, was 1,791, according to the Bureau of Labor Statistics (BLS).  The labor force grew 1,067, and the two numbers together give the Ocean State an improved unemployment rate of 4.2%.

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Over the years, these monthly reports have also given the unemployment rate imagining that so many Rhode Islanders hadn’t stopped looking for work after the Great Recession.  Because that number is constant, employment increases have larger effects on the unemployment rate, and this month, the unemployment rate would have dropped from 6.6% to 6.3%.

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The first hint that this good news could be better comes with a comparison with Massachusetts.  Although Rhode Island’s growth has been better than Connecticut’s (which is still higher when compared to the days before the recession), Massachusetts employment growth is literally off the charts… this chart, anyway:

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This contrast is deepened when we acknowledge that Rhode Island is still toward the back of the pack, among just a dozen states that have not yet regained all of their lost employment.

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To return to a positive view, though, it’s worth noting that if the number of new jobs based in Rhode Island continues to increase at its current rate, we could return to, or even exceed, the growth rate we were experiencing before the start of 2016.

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The last chart for this monthly report shows New England states’ positions on the Rhode Island Center for Freedom & Prosperity’s Jobs & Opportunity Index (JOI).  JOI takes into account 12 data points, including these employment and jobs numbers as well as income, taxes, and welfare, and it finds Rhode Island to be 47th in the country.

All of the new data, this month, came from the BLS (all positive), except for the number of people enrolled in Medicaid, which presented a slightly negative picture.

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  • Rhett Hardwick

    It is little noticed that Rhode Island has always been a ‘factory town”, until a few generations ago, it was jewelry and precision tools. Before that Narragansett Bay made “shipping” the industry. Given it’s size that is probably the natural way of things. The question is how do we find another industry, or more properly, how does it find us. Look what Finance did for Charlotte, North Carolina.

    • Rhett Hardwick

      Back in the 80’s I knew a manager with Olympia & York (then the world’s largest property owner, I believe it is now defunct) with the “deregulation” of state borders, they thought Providence the obvious center for banking and insurance in New England. Don’t know what happened to that. Possibly the tremendous improvements in telecommunications (internet). Recently I came across a 1947 Popular Science. One article was about “fax machines” (remember those?) it noted they had been around for a generation, but soon “there would be one in every home”.

  • Flawed Logic

    Do you have any evidence that “so many Rhode Islanders hadn’t stopped looking for work after the Great Recession”? How do you distinguish them in your “analysis” from people who have retired?

    • Justin Katz

      Why distinguish them? People who have retired have stopped working and looking for work, and our economy did not replace them.

      • Flawed Logic

        “People who have retired have stopped working and looking for work, and our economy did not replace them.” That’s why we have job growth statistics.

        Bastardizing unemployment data by ginning it up with folks that have retired, moved away, died and otherwise are no longer in the population is disingenuous at best.

        • Justin Katz

          Job-growth statistics don’t improve our economy; they measure something different from people who live in the state and are working.

          I’d also suggest that your blithe dismissal of the fact that people have moved away are somehow a neutral statistic. Often they’ve moved away because they could not find work.

          What’s most absurd about your comment is that it is in reference to one chart among a whole bunch, and you mistake its role in the collection. Picking an absolute denominator to compare with the official unemployment rate gives a different view, which can be good or bad. Note that, this month, unemployment improved more on that line than on the official line.

  • Justin Katz

    We just disagree. I find the official unemployment rate generally meaningless, because it makes no sense to say that things are improving when people are giving up looking for work. (While retirement is part of the change, it isn’t the whole story or even most of the story.) This series started to measure our progress against the situation at the start of the recession, so that’s the unemployment rate of interest, especially in context of a variety of other charts.

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