Rhode Island Employment Revision, December 2015: Expected Revision Drops Employment and Changes Narrative

[Click here for the printable one-page PDF of this post.]

As expected, the Bureau of Labor Statistics’ (BLS’s) annual revision of employment data for Rhode Island changed the picture substantially, undermining claims that politicians and activists have been making about Rhode Island’s economy. For December, Rhode Island’s unemployment rate was revised up from 5.1%, to 5.4%. What had been reported as 29 straight months of decreases actually involved a halting motion.

Even that description overstates the improvement, though. As the first chart shows, not only were Rhode Island’s employment and labor force numbers originally reported too high (which wasn’t the case for all states), but the rate of increase throughout 2015 was not as high as reported. With the revision, 4,278 working Rhode Islanders evaporated, and 2,626 people who were supposedly employed or looking for work did the same.


The labor force never had the strong (if short-lived) bounce that the data had showed, and moreover, two years of steady increases in employment hit a wall in early summer. If any effect of recent government policies is visible in this data, those policies must have put a halt to Rhode Island’s painfully slow improvement.

Looking at Rhode Island’s neighbors, the revision for Massachusetts took away much of that state’s boom but ultimately left it about where it was before the revision. Connecticut did receive a sizable reduction in the employment number, but it is still above its level just before the recession. Meanwhile, Rhode Island took another big step back from its pre-recession levels of employment and labor force.


The third chart at right also worsened with the revision. The red line shows what RI’s unemployment rate would have been if the labor force had not shrunk since January 2007. Because of the way the numbers are calculated, while the blue line did move up, the red line moved up even more. The red-line unemployment rate never came anywhere near 8%. As of December, it would have remained at 9.1%, having spent five months worsening. Before the revision, it was 8.4%.


[Click here for the printable one-page PDF of this post.]