‘Light at the end of the tunnel’ for RI’s economy
Tuesday, September 14, 2010
There is light at the end of the tunnel for Rhode Island’s beleaguered economy—although that light is dimmed by the threat of a national downturn, according to University of Rhode Island economic Leonard Lardaro.
His monthly Current Conditions Index shows that the state economy improved for the second month in a row in July. The index pegs the state economy in July at 58, on a scale of 0 to 100, with figures above 50 indicating economic growth and figures below that threshold signaling a recession. The index is calculated on the basis of several factors, including the change in the unemployment rate, retail sales, consumer sentiment, and permits issued for single-family homes.
“At long last, we are beginning to see ‘the light at the end of the recession tunnel,’” Lardaro said. “When the CCI moves consistently above 50, we will finally be in a recovery. While this might have already have begun, the recent slowdown in the national economy remains as a potential dark cloud for our future momentum.”
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTThe index of 58 is certainly a dramatic improvement over July 2009, when it was at 17.
It’s also right where the state was in June 2010—after flat-lining at 50 in May and April. Lardaro said the state needs to consistently be above 50 in order to truly to put the recession behind it.
“I can’t rule out the possibility that Rhode Island is in the early stages of a recovery,” Lardaro told GoLocalProv. “We’ve come a long way since the depths of this in 2008. So, if we’re not recovering, we’re about as close as you can get.”
Positive indicators for July included a 3.2 percent increase in consumer sentiment, a 2.1 percent increase in retail sales, and a 1.3 percent increase in the labor force, compared to a year ago. On the downside, single-family permits decreased by 4.5 percent compared and private service-producing employment declined by .7 percent. For more information about the Current Conditions Index, click here.
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