Can Anything Stop RI’s Unemployment Rate Escalation?

This month’s iteration of a grim series of headlines:

R.I. jobless rate: 11.1%

Unfortunately, the series finale doesn’t appear to be likely any time soon:

A group of economists testifying at the State House in early May projected that Rhode Island’s unemployment rate would peak at 12.3 percent in 2010. One of the economists was Andres Carbacho-Burgos, of Moody’s Economy.com. In a phone interview Thursday, Carbacho-Burgos said Rhode Island’s rate of job loss should begin to slow soon, and there might even be some slight job gains, perhaps 5,000 jobs, toward the end of next year. But real improvement probably won’t take place until 2011, he said.

Yup, that says 2011, as in two more years of job declines. As in a forty-month run of losses.
Of course, the wrong moves in state and local government could exacerbate the problem. Yesterday’s headline was that our rate of population loss has slowed, probably because Rhode Islanders are trapped and see no significant improvement of their odds elsewhere. Imagine the change in that dynamic when the state lags the national recovery, as is widely expected.
By contrast, if the General Assembly were to take some bold steps designed to attract businesses and give current managers, owners, and consumers confidence in the state’s future, Rhode Island could actually lead the recovery. Part of the advantage of being so low is that it takes much less to advance.

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Tim
Tim
12 years ago

Who are these 11.1% unemployed?? No one I know has lost their job in the past year and in general conversation with family, friends and co-workers (a wide cross section of careers/neighborhoods lived in etc) there are few if any stories of newly unemployed that anyone of us can point to. In fact my college freshman niece had no difficulty getting part-time job at a Subway in Providence this past fall. We hear all the time about the skyrocketing unemployment, about the economic squeeze that’s on right now.
Where?
It’s Friday. Check out the restaurant parking lots tonight. They’ll be chock full.

Tom W
Tom W
12 years ago

>By contrast, if the General Assembly were to take some bold steps designed to attract businesses and give current managers, owners, and consumers confidence in the state’s future, Rhode Island could actually lead the recovery. Part of the advantage of being so low is that it takes much less to advance.
True.
But the General Assembly – and in particular its leadership that runs it and so runs this State – has neither the intelligence or vision to recognize what needs to be done. Neither does it have the political backbone to do that. Nor does it care about the future of Rhode Island.
If it did, then it would have taken these steps a long time ago, such as when the canary was singing loud as they spend the tobacco money to plug budget holes.
They only care about pandering to the unions and poverty industry, and will only make such changes as they believe are the minimum that they have to in order to ride this out another year and hope that it’ll fix itself somewhere down the road.
In other words, exactly what they’ve been doing for years now.
Democrat-run states are all failing: California, New York, Michigan, New Jersey, Rhode Island. Wherever you have Democrat control you have public sector union control, and so the decline and eventual failure of those state is baked in.

Chris
Chris
12 years ago

Tim
The job losses are real. I personally know five people that have lost their jobs since the first of the year, all of them having worked in the tech sector, and all a result of the faltering economy. None of these people were incompetent slackers, they were victims of (take your pick): downsizing, outsourcing, weak demand, poor cashflow, credit problems, etc. If no one in your immediate circle of family or friends has been whacked yet, consider yourself fortunate.

rhody
rhody
12 years ago

Tim, you should’ve used the blue sarcasm font I’ve seen on other boards.
My business has tasted the pain pretty bad, but it’s happening all over. I can tell you firsthand the hotels are feeling it.

Will
12 years ago

The answer largely depends on what circles you gravitate within. You may not have intended your answer to sound like the classic “I can’t believe Richard Nixon won reelection. No one I know voted for him.” I work in the financial services sector, and it’s been a job loss bloodbath. Real estate, hospitality (hotels), advertising, and the like, have all had similar losses. Construction and contracting is also way down. If you’re a public employee, chances are, you’re still employed and the real world hasn’t affected you yet. I think a lot of the layoffs that were made since the beginning of the year were preemptive (i.e., meant to cut costs in anticipation of worse news in the future), and have probably gone a little overboard, so they’ll probably have to rehire some people once demand returns to something close to normal. I don’t think things are going to get better very quickly anytime soon, especially here, though I think we are probably close to the bottom. The real question is, how long do we stay down there? PS About the unemployment rate… which is nominal at best, because it doesn’t really count people who have stopped looking for work. Even for the nominal rate to stay at the same number, you still need job growth just to maintain the number. New people are always going into the job market, for instance, recent college graduates. People also naturally enter the job market as they get older, so there’s always new people looking for work, even if everything else in the market remains relatively stable. If the economy is not producing enough jobs to keep up with that regular growth, plus if you factor any significant change in demand for a product or service, essentially you develop a glut of workers… Read more »

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