States Slowest to Recover from Recession: Where RI Stands
Friday, January 04, 2013
Rhode Island ranks in the middle of the pack when it comes to how states have recovered from the Great Recession, according to a report released by the website 24/7 Wall St.
The report factors in unemployment rates from before the recession began and where they stand today as well as GDP growth in 2011. The Ocean State ranked No. 33 overall.
“Just prior to the recession, in November 2007, Rhode Island had the fourth-highest unemployment rate in the country at 5.8%, while the national rate was 4.7% at the time,” the website states. “Two years later, the state’s unemployment rate had increased to 11.9%, still the fourth-highest rate in the U.S. As of October of this year, the rate had fallen only slightly to 10.4%, the second-highest in the country behind only Nevada. One of the worst repercussions of the recession in Rhode Island has been the effect on the state’s housing market. Home prices fell by more than 25% between the second quarter of 2007 and the second quarter of this year, and they are projected to continue falling through the end of this year.”
The five worst states in terms of recovery included South Dakota, Pennsylvania, Connecticut, New York and New Jersey. The top states include Michigan, Ohio, South Carolina, Utah and Oregon. Of the New England states, Massachusetts (ranked No. 19) has had the best recovery.
“Connecticut’s unemployment rate reached a high of 9.4% in August 2010,” the site states. “Unemployment then started to fall but in mid-2012 began rising again, eventually reaching 9% in October. The labor force lost more than 30,000 employees over the 12 months ending in October. Total employment as of October was lower than at any point during the height of the recession. Fairfield County, home to many financial sector employees, has been impacted by Wall Street layoffs, which have also pushed down home prices. As of October, Waterbury, another area in Connecticut, had an unemployment rate of 11.1% — one of the highest in the nation.”
According to a report released last month by the New England Economic Partnership, the state’s jobless rate will remain above 10 percent through 2014 and will drop to 9.1 percent the following year. By 2016, the report suggested, the number will drop to 6.9 percent.
The report suggested that most of the jobs that are expected to be created from over the next four years will be in leisure and hospitality, professional and business services, education, state and local governments, health services, and financial activities. The forecast indicates that retail trade, warehousing and utilities, information, wholesale trade, and transportation will add very few jobs in the state over the next few years.
Overall, the forecast suggests that Rhode Island’s job market will continue trailing job creation in the rest of the nation.
“From 2011 to 2016, the annual growth rate of employment is forecasted to be 1.3 percent in Rhode Island, compared to 2 percent in the United States,” the report states. “Total nonfarm employment is forecasted to be 461,400 in 2013 as compared to 458,000 in 2012, an increase of 3,400 jobs. Rhode Island’s nonfarm employment is expected to be 479,100 in 2015, an increase of about 21,000 jobs from 2012.”
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