Providence (August 2019) – Today, the Center for Global and Regional Economic Studies at Bryant University and the Rhode Island Public Expenditure Council jointly released the Rhode Island Current Economic Indicator (CEI) Briefing for Q2 2019.
Rhode Island GDP is projected to expand 1.7 percent in Q2 2019 and 2.2 percent in Q1 2019, which is higher than projected in the briefing’s previous issue. Despite faster than projected growth, GDP performance remains sluggish, and there is a widening “growth gap” between the Ocean State and the remainder of New England and the United States.
In contrast, the Rhode Island CEI shows overall improvement in the labor market; nonfarm employment grew by 7,000 jobs between January and June 2019 and the unemployment rate dropped from 4.0 percent in January to 3.6 percent in June. Seven of eleven internal factors that comprise the CEI positively affected the economy, including job growth in construction, leisure and hospitality, and education and health services. However, employment in manufacturing and professional and business services decreased, and despite a positive performance in Q2 2019, employment in the information services sector was flat over the last twelve months.
The persistent sluggishness of GDP coupled with the recent growth in employment indicates that Rhode Island faces low labor productivity that has negatively affected key industries. Related to the issue of productivity, real wages and salary disbursements is estimated to have decreased 1.0 percent in Q2 2019 despite overall employment growth.
The quarterly CEI, developed by economists at The Center for Global and Regional Economic Studies at Bryant University, combines several key gauges of economic activity in a single statistic that measures the overall current economic conditions in Rhode Island. It is calibrated to grow at the rate of the Real Gross State Product and, therefore, can be interpreted as the underlying growth rate of the state economy. The CEI is calculated using the most current available data for the state.