KINGSTON – Despite a drop in his Current Conditions Index (CCI) for Rhode Island in February, University of Rhode Island economist Leonard Lardaro saw reason to believe that the state should be closer to recovery from recession later this year.

“Happy days aren't here again,” Lardaro said in a statement released with the CCI. “But we have clearly moved past the abyss at the end of last year.”

The index, a compilation of 12 economic indicators from public and private sources, fell to 8 in February from 17 in January. (Numbers below 50 indicate contraction of the economy, while those higher than 50 indication expansion.) The index value stood at 8 for nine months of 2008, plunging to 0 three times, most recently in October.

Lardaro took pains to note that “not all CCI values of 8 are alike. ... Like the nation, Rhode Island seemed to fall of a cliff [at the end of last year].” (READ MORE)

And just as rates of growth can be unsustainable, he said, “rates of decline can also be unstainable.”

Thus, Lardaro saw a number of the monthly indicators as stage-setters for eventual growth. “Six of the 12 CCI indicators either improved or didn't deteriorate much in February. More importantly, two of those are leading indicators,” he said.

The one indicator that did improve from February 2008 was Manufacturing Wage, which increased 1.6 percent. The Labor Force declined 0.4 percent for the same time period.

The two indicators that gave Lardaro reason for his slight optimism, U.S. Consumer Sentiment (down 20.3 percent year over year) and Employment Service Jobs (down 20.5 percent year over year), were less negative compared with January, supporting the economist’s argument that the state may have hit bottom and is creating conditions for forward momentum, no matter how modest.

Other indicator performance year over year included:

• Government Employment – down 2.2 percent.

• Single-Unit Permits – down 70.3 percent.

• Retail Sales – down 3.9 percent.

• Employment Services Jobs – down 20.5 percent.

• Private Service-Producing Employment – down 2.9 percent.

• Total Manufacturing Hours – down 12.4 percent.

• Benefit Exhaustions – up 54.4 percent.

• New [Unemployment Benefit] Claims – up 65.3 percent.

• Unemployment Rate – up 61.5 percent.

The Current Conditions Index, created by University of Rhode Island economist Leonard Lardaro, measures the strength of the state’s economic climate. The index – based on 12 key economic indicators related to housing, retail sales, the employment situation and the labor supply – attained its maximum value of 100 points several times in 1984 and 1986. Additional information, including historical data back through 1980, is available at members.cox.net/lardaro/current.