"The five economic indicators that the federal government tracks - for the first time since August 2006 - were positive this October."
Lincoln Chafee on Saturday, December 1st, 2012 in a newspaper interview
Rhode Island Governor Lincoln Chafee says five economic indicators tracked by the federal government were positive in October, for first time since 2006
"Are we there yet?"
Anyone who has driven the family to a vacation on Cape Cod has heard that question rise up from the back seats, a plaintive cry for progress as the traffic crawls toward the Bourne Bridge.
After four straight years of unemployment over 9 percent, Rhode Islanders wonder how long their road to economic recovery is going to be. Governor Chafee made the case earlier this month that, though it’s been slow going, the state is making progress.
In a Dec. 1 interview with The Providence Journal about his plans for the state Economic Development Commission, Chafee said the state isn’t getting enough credit for the progress it has made on the economy, particularly this year.
"We're seeing unemployment going in the right direction, for the last six months," he said. "The five economic indicators that the federal government tracks -- for the first time since August 2006 -- were positive this October."
We weren’t sure which indicators he was talking about or whether they were actually all in positive territory, so we decided to check.
The state and federal governments track the labor market through a variety of statistics. The most commonly watched by the public is the unemployment rate. But other indices are used too.
The numbers don’t always move in the same direction. Improvement in one can be offset by setbacks in another. For example, if the size of the workforce goes down but the number of unemployed stays the same, the unemployment rate will go up.
Chafee was touting the five indicators for the month of September (they were released in October, hence his reference to them as October numbers), because the bad numbers (concerning unemployment) all fell and the good numbers (employment) all rose, and all at the same time.
Laura Hart, a spokeswoman for the state Department of Labor and Training, said the five federal categories Chafee was referring to are the same key indicators the state tracks, through data approved by the federal Department of Labor.
Here are the indicators for Rhode Island, and how they changed from August to September, as reported by the state DLT:
- The unemployment rate dropped from 10.7 to 10.5 percent
- The number of unemployed people dropped from 59,221 to 58,663
- The number of employed people (at jobs in Rhode Island and nearby states) increased from 495,480 to 499,480
- The total work force (the number of people available to work) went up from 554,701 to 558,143
- The number of in-state jobs went from 456,000 to 459,500 .
The last time those five indices all went in the right direction was from July to August of 2006, when the unemployment rate went from 5.1 to 5 percent.
So Chafee was right.
DLT spokeswoman Laura Hart cautioned that the month-to-month figures are extrapolations from polling of residents and employers and could be revised in March, when employers file tax information.
She compared it to the difference between a poll and an election.
Chafee is not alone in seeing some movement, however slow, in the state’s economic recovery. University of Rhode Island economics Prof. Leonard Lardaro has commented on the underappreciated progress the state is making, but noted that it seems to come in fits and starts.
"While Rhode Island’s economy remained in a recovery, the magnitude of which almost nobody in this state seems to fully comprehend, the pace of that recovery tapered off a bit in September following a very strong August," Lardaro wrote in his Rhode Island economics blog Nov. 12.
In a report prepared for the Dec. 6 Fall Economic Outlook Conference hosted by the New England Economic Partnership at Bryant University, Edward M. Mazze, a former dean and current business professor at the University of Rhode Island, and Edinaldo Tebaldi, associate economics professor at Bryant, noted the state’s sluggish recovery rate, predicting that Rhode Island’s unemployment rate may not fall below 7 percent until 2016.
Governor Chafee said five economic indicators tracked by the federal government went up in October, the first time they’ve done so in the same month in six years.
Regardless of whether you believe the state has finally turned the economic corner, he got the facts right.
We find his statement True.
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