PROVIDENCE, R.I. (WPRI) – Fewer and fewer working-age Rhode Islanders have a job compared with before the Great Recession even though the official unemployment rate has fallen back to a normal level, according to a new study.
The Pew Charitable Trusts said the employment rate for Rhode Islanders ages 25 to 54 has fallen from 83% in 2007 to 78% in 2016, a statistically significant drop of 5 percentage points. While that’s an improvement from the low of 75% reached in mid-2012, the positive trend has reversed this year after a period of rising employment.
Another way to look at it: for every 100 prime-working-age people living in Rhode Island, five fewer had jobs in 2016 than in 2007, according to Pew’s analysis of federal data. Yet the official unemployment rate at both points was almost exactly the same: 5.5% and 5.2%, respectively.
“Although unemployment figures receive substantial media attention, many economists also track the employment-to-population ratio because it provides a broader view of labor market conditions,” Pew’s analysts noted. “The unemployment rate, for example, excludes people who are not looking for jobs, but the employment rate captures this group in its measurement of population.”
“Focusing on 25- to 54-year-olds reduces the distortion of employment trends resulting from demographic effects such as older and younger workers’ choices regarding retirement or full-time education,” they added.
Only three of the 50 states – New Mexico, Nevada and Alabama – have experienced a larger drop in prime-age employment than Rhode Island since 2007, although nearly every state saw some decrease. The decrease was only half as large nationally, at 2.4 percentage points.Ted Nesi (email@example.com) covers politics and the economy for WPRI.com. He writes The Saturday Morning Post and hosts Executive Suite. Follow him on Twitter, Facebook and Instagram