Last month I wrote that: “The Current Conditions Index … continues to perform fairly well.” That assessment was based on the earlier labor market data. Recently, the revised data for 2024 and new 2025 data were released. While in the aggregate these revisions seemed fairly innocuous, certainly not as negative as had been the case in the recent past, several individual indicators were dramatically changed. The resident population in the household survey was larger, causing downward revisions to both the employment and labor force participation rates. In the establishment survey, Employment Service Jobs, a key leading labor market indicator of future job growth, as it includes temporary hiring, was slashed to register declining annual changes for every month of 2024. Since the original data showed increases, this caused the 2024 Current Conditions Index values to be revised lower for most months (see arrows below).

 What do the revised CCI values show? We peaked in June (at 75), fell off a bit through September (plateaued at 67), then saw lower values thereafter, actually falling to the neutral value of 50 for both December and January. Whereas I had thought we might be going into national weakness from a position of strength, with the absence of FI (First In), apparently, we may well be observing our “usual” FI as national weakness occurs. It’s still too soon to make this definitive conclusion, but things don’t look too promising right now. This is reinforced by the monthly CCI, which was in the contraction range for all but three months last year. The good news: It was 58 for January.

 Overall, six of the twelve CCI indicators improved in January relative to a year ago, as did only one of its five leading indicators. For now, at least, we continue to sustain a yearly uptrend in our state’s Labor Force (+0.7%), although it has stagnated monthly. Our state’s manufacturing sector has weakened: Total Manufacturing Hours declined yearly (-0.7%) for the second consecutive month and the Manufacturing Wage fell once again (-1.3%), its fourth consecutive decline. At least Retail Sales, a key indicator of our state’s economic health, rose by 2.8 percent in January. Should it weaken, that’s when we really have to begin worrying.

 New Claims for Unemployment Insurance, which reflects layoffs and is a leading labor market indicator, has risen nine times (monthly) since last January while declining for two of the last three months at an annual rate, although it still lacks a well-defined trend in either direction. On the other end of the spectrum, Benefit Exhaustions, which reflect long-term unemployment, improved (-2.5%) this month for only the first time since last January. 

 As noted earlier, Employment Service Jobs which includes “temps,” and is a leading labor market indicator of future employment, fell by 5.1 percent, declining annually for over a year. Government Employment, a consistent performer, registered another increase, 3.6 percent, its seventeenth since September of 2023. Private Service-Producing Employment, which reflects non-government, non-goods-producing employment that improved every month last year, saw its growth move higher to 2.0 percent. US Consumer Sentiment failed to improve this month (-9.7.%). What had been a consistent area of improvement of late related to housing, Single-Unit Permits, or new home construction, fell (-1.3%) for the second time in the last three months.  

 Resident employment, the number of employed Rhode Island residents (either in or out of state) continued its uptrend but was flat annually this month. Given the upward revisions to our state's population 16 and over, the employment rate (percent of the population employed) declined annually for every month since last June, which is a very negative statistic. The labor force participation rate (percent of the population in the labor force) was also revised lower but it has remained flat since last August. At this point, it is appropriate to view the higher levels of the Unemployment Rate as an accurate measurement of one element of labor market slack (the employment rate is the other) as values in the 4+ range can no longer be viewed as statistical aberrations.

 As we now view Rhode Island’s economic performance more accurately, slowing, possibly FI, this is a warning signal that along with those originating from national weakness, must be taken into account as we begin to confront large budget deficits that will further slow our state’s economic momentum.

 

 

 

 

Monthly CCI Values (red = contraction) (Note: These are revised values. Original reports sometimes specify different CCI values, based on originally released data. Jan   Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1983 42   58 58 67 75 83 83 75 83 83 83 92 1984 100   92 100 100 100 100 100 92 100 92 92 83 1985 67   75 75 75 67 75 67 50 50 58 83 67 1986 75   83 100 92 92 83 92 92 92 92 92 67 1987 67   67 58 58 67 75 75 75 75 67 75 75 1988 83   83 75 67 67 67 58 50 67 58 50 58 1989 67   50 50 33 58 33 25 25 25 33 33 33 1990 25   25 25 25 17 17 17 17 33 17 25 25 1991 25   17 17 8 25 17 25 25 25 33 17 17 1992 42   42 58 75 75 83 75 67 67 83 83 92 1993 75   83 67 67 83 67 75 75 75 58 42 58 1994 58   67 67 58 58 75 67 67 67 67 83 75 1995 58   58 58 67 50 42 42 42 58 33 67 42 1996 50   42 75 75 67 75 75 67 75 92 83 92 1997 100   92 83 75 67 75 75 75 83 75 92 83 1998 83   75 75 75 75 75 75 67 58 75 75 50 1999 83   75 75 83 67 83 75 75 92 75 83 58 2000 83   83 83 67 42 50 58 50 58 67 67 67 2001 42 33 25 17 33 50 25 33 33 42 33 42 2002 58   75 67 58 42 33 50 50 58 67 67 50 2003 50   50 50 58 58 58 83 67 83 75 92 67 2004 67   67 58 67 58 58 67 67 67 58 50 67 2005 50   67 50 50 42 75 58 67 42 58 58 67 2006 58   58 67 58 33 50 33 58 75 83 58 67 2007 50   50 33 33 58 50 33 33 17 17 8 25 2008 8 8 8 17 8 0 8 0 8 0 8 8 2009 17 8 0 8 17 33 17 42 33 42 50 33 2010 42   58 67 67 75 75 83 83 67 67 75 83 2011 50 67 67 58 50 58 58 42 50 50 58 50 2012 58   50 58/75 50/75 58/67 67/75 50/58 67/75 50/58 75/83 75/83 92 2013 75   67 83 67 83 75 75 67 75 75 67 75 2014 67   67 58 58 67 50 67 67 75 67 58 67 2015 58   58 67 58 67 75 75 92 83 67 75 58 2016 58   67 50 42 50 42 67 75 75 50 58 75 2017 75   83 92 83 83 83 83 83 75 83 92 83 2018 75   92 75 67 92 83 75 67 67 42 83 58 2019 75   33 58 58 58 75 83 67 50 75 58 83 2020 75   75 33 8 8 25 25 25 25 17 25 25 2021 25   17 42 75 92 83 100 75 83 83 83 92 2022 75   75 75 67 67 67 75 92 92 75 67 50 2023 33   58 42 33 33 42 33  50 33 50 58   58 2024 58   75 58 67 75 83 67 75 75 67 67 67 2025 50                         You can download monthly reports in PDF format starting with January 1999 by clicking on the monthly index value.

Historical Annual CCI Values 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 42 54 33 74 96 67 88 69 65 39 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 22 21 70 69 67 51 72 81 72 77 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 65 39 56 66 63 57 54 40 7 24 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 70 55 74 75 63 64 56 85 79 61 2020 2021 2022 2023              26 65  72  54

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