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Rhode Island’s Most Unemployed Cities & Towns

Tuesday, October 09, 2012

 

While the statewide jobless rate dipped to 10.7 percent last month, one in four Rhode Island municipalities still reported at least 11 percent unemployment, according to data from the Department of Labor and Training.

The highest unemployment rates come from many of the cash-strapped urban communities (Central Falls, Pawtucket, Providence and Woonsocket are all above 12 percent), but rural parts of the state haven’t been spared by an economy that University of Rhode Island economist Dr. Leonard Lardaro describes as shifting “into a lower gear” (Charlestown, Burrillville and Scituate are all at least 11 percent).

“The most critical question going forward is whether monetary policy will be able to re-accelerate the US and world economies,” Lardaro wrote in the September edition of his monthly Current Conditions Index, which analyzes the state’s economy. “Even if they do, how much will Rhode Island benefit given its non-competitive tax and cost structure? This would be a very appropriate time.”

Lardaro’s comments came ahead of a Rhode Island Public Expenditure Counsel (RIPEC) report that recommended revamping the state’s Economic Development Corporation (EDC) to help stimulate the state’s economy and avert 38 Studios-like problems moving forward. The suggestions included rebranding the quasi-public agency, creating a cabinet-level Secretary of Commerce and appointing a nine member council comprised of business and government leaders to advise the agency.

Bridges to Nowhere

But others say the state’s flaws when it comes to turning around the economy run much deeper. In an e-mail sent Sunday evening, the Ocean State Tea Party in Action (OSTPA) described too many of the state’s investments as “bridges to nowhere” and argued that the state desperately needs to address business regulation, taxes, and education in order to truly improve on an unemployment rate that is still second worst in the nation.

The e-mail outlined a three-phase plan that would include asking business leaders to draw up a plan for addressing the state’s most pressing issues and pushing lawmakers to focus on tackling a range of issues from public assistance and illegal immigration to public employee union costs across the state.

“The current practice that ignores the fact that the cost of RI government is too high, our education system too weak, and our regulatory system out of control has not worked,” the Tea Party’s e-mail stated. “Putting lipstick on the pig has only cost Rhode Islanders more.”

Some Improvement

Still, while the state has lagged behind much of the country when it comes to job creation (the nationwide unemployment rate dropped to 7.8 percent in September), municipalities have seen their jobless numbers drop significantly in recent months.

Since 2008, only three communities (Narragansett, Barrington and Richmond never saw their unemployment rates rise above ten percent, while 14 communities saw at least 14 percent of their workforce without work at some point over the last four years.

“It is encouraging that the state's unemployment rate has gone down by almost three-quarters of a percent from August 2011 through August 2012 while the nation's unemployment rate headed downward by one percent during the same time period,” University of Rhode Island business professor Dr. Edward Mazze said last month.

But Mazze was quick to point out that when the number of workers who have given up looking for work, are underemployed or have permanent jobs are figured in, almost 30 percent of the state’s workforce could still be struggling.

“In August, most of the new jobs added were in the hospitality industry, health care and assistance and educational services,” Mazze said. “These are three sectors of the economy dependent on seasonality and demand for services. When it comes to the current job numbers, the best we can say is that Rhode Island is in neutral and can go in any direction. Thankfully, it moved in a positive direction for August.”

Lawmakers Consider Options

On Smith Hill, lawmakers say they’ll attempt to make economic development a top priority during the 2013 legislative session. While the RIPEC report is one of the options the state is considering, the General Assembly’s Joint Committee on Economic Development also heard a plan last week that would include eliminating the EDC altogether.

That plan, titled “Rebooting the Economic Development System in Rhode Island,” was put together by Scott A. Gibbs and Marcel A. Valois, president and vice president, respectively, of the Economic Development Foundation of Rhode Island, and Gary S. Sasse, director of the Bryant (University) Institute for Public Leadership and former director of both the Rhode Island Public Expenditure Council and Department of Administration.

The three authors suggest vesting the current EDC responsibilities in three new bodies: a strategic office that answers to the governor, a research body based in the state’s universities and a new board of directors that would collaborate with the private sector and administer programs.

“We are very much interested in hearing from anyone who has looked at the issues and has some suggestions to make,” Representative Donna Walsh (Dist. 36, Charlestown, New Shoreham, South Kingstown, Westerly), who co-chairs the committee. “Economic development is no simple formula, and we need to hear everyone’s ideas in order to make informed decisions about what our state government should be doing to rebuild our economy and encourage prosperity.”

Another committee co-chair, Senator James Sheehan (Dist. 36, Narragansett, North Kingstown), made it clear that there is no “silver bullet” when it comes to turning the state around, but stressed that collaboration is crucial.

“We need collaboration between our state’s brightest thinkers, people who have experienced the hurdles facing small and large businesses, and people who’ve worked in economic development efforts who know what helps and what doesn’t,” he said. We’re looking forward to considering all the plans that come forward.”

 

Dan McGowan can be reached at dmcgowan@golocalprov.com. Follow him on Twitter: @danmcgowan.

 

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