SOUTH KINGSTOWN – Harsh winter weather dragged down new home construction and Rhode Island’s overall economic performance in February, according to the Current Conditions Index produced by University of Rhode Island economist Leonard Lardaro.
The index, released Monday, measures the state’s economic performance, or momentum, using a dozen different metrics. A CCI greater than 50 signals progress, while a value less than 50 indicates setbacks.
February’s CCI of 58 is lower than both January’s figure of 67 and the index for February a year ago, which was also 67, the report states. A key indicator, single-unit permits, a reflection of new home construction, “plunged” by 57 percent compared with a year ago, to only 26 new units statewide, Lardaro added.
Had it not been for the factor of a rugged winter, the CCI would have matched values for the previous month and one year ago, he said.
Nonetheless, other factors also stifled momentum, Lardaro said, including new claims for unemployment insurance, which rose 11.5 percent compared with a year ago. In addition, several normally beneficial indicators, such as government employment, employment service jobs and manufacturing wages, remained flat.
The rate of decline in the state’s labor force also continued to exceed 1 percent, with February registering as the state’s 10th consecutive decrease, the report states.
Bright spots in the measurement of momentum included retail sales, which showed a 5.3 percent year-over-year gain, and U.S. Consumer Sentiment, which increased year over year by 5.2 percent. Total manufacturing hours increased 3 percent as well, the report states. Private service-producing employment also showed a rise, increased by 1.8 percent.
“The present recovery continues to be less broadly based than it was a year ago,” Lardaro concluded, “based on the fact that the CCI has now failed to exceed its year-earlier value for seven consecutive months. There are areas of strength, however, and payroll employment is growing faster than we had thought.”