PROVIDENCE, RI – Rhode Island’s economy showed concerning trends across several key indicators in the second quarter of 2025, according to the Rhode Island Key Performance Indicators (KPI) Quarterly Briefing, released today by The Center for Global and Regional Economic Studies at Bryant University and the Rhode Island Public Expenditure Council (RIPEC).
Rhode Island’s labor force participation rate declined for the fourth consecutive quarter, reaching 63.7 percent in Q2 2025. Meanwhile,the number of employed Rhode Islanders fell by 3,300 (0.6 percent) quarter-over-quarter and by 6,900 (1.2 percent) year-over-year, reversing gains made during 2023 and the first two quarters of 2024. Rhode Island’s unemployment rate rose to 4.9 percent and has now either risen or remained unchanged for eight straight quarters. Rhode Island’s unemployment rate exceeded both New England and the U.S. for the sixth consecutive quarter
Non-farm employment (Rhode Island-based jobs) remained steady at historically high levels, while preliminary net sales tax receipts—a key demand indicator—increased 2.5 percent in Q2 2025, reversing a 2.4 percent decline in Q1 (seasonally adjusted).
In Q1 2025, Rhode Island’s Gross Domestic Product (GDP) declined by 0.2 percent (annualized) following four consecutive quarters of growth. Still, Rhode Island outperformed both the New England Region and the U.S., which respectively saw GDP drops of 0.8 percent and 0.5 percent in Q1. GDP data from Q2 2025 are not yet available.
“Rhode Island’s economy held steady in Q2 2025, with non-farm employment remaining near historic highs and consumer demand showing modest growth. However, several concerning trends are emerging. The indicators presented in this Briefing suggest that, despite surface-level stability, the state’s economic momentum is weakening,” remarked Edinaldo Tebaldi, Professor of Economics and VP of Strategy at Bryant.
“The data this quarter reflect growing headwinds for Rhode Island’s economy and merit attention from Rhode Island policymakers and businesses,” said Michael DiBiase, President and CEO of RIPEC. “While some sectors continue to add jobs and net sales tax receipts indicate some growth in consumer demand, the broader trend in employment and labor force participation suggests that we are entering a period of increased uncertainty.”
Only two of the state’s nine major industry sectors saw job gains in Q2: professional and business services (+2,600 jobs) and education and health services (+600 jobs). Employment losses were concentrated in leisure and hospitality (-1,400 jobs), trade, transportation, and utilities (-1,300 jobs), and government (-700 jobs). The remaining sectors—construction, manufacturing, information, and financial services—remained largely unchanged, having experienced marginal declines.
The data set used to create the Briefing is available here.
