RI unemployment higher than neighboring states and nation, report details

In 2024, Rhode Island saw higher unemployment but higher gross domestic product growth compared to neighboring states, according to the Key Performance Indicators report released by the Rhode Island Public Expenditure Council and Bryant University earlier this month. 

Today’s job market is “brutal,” said Steve Colella, the founder and director of Job Club Rhode Island. “It’s not impossible, but only the strong survive.”

Here are a few takeaways from the report — from GDP growth to employment changes in the hospitality industry.

In Q3, Rhode Island GDP rose 3.6% — faster than both national and regional rates

From July to September, Rhode Island’s GDP increased by 3.6%. This growth rate exceeded both the New England and the national levels of growth for the same period, which stood at 2.9% and 3.1%, respectively.

This “strong momentum” reflects “the success of our economic development strategies and investments,” said Matthew Touchette, a spokesperson for the RI Executive Office of Commerce.

Although this high growth rate is unique — “typically, we lag the region” in GDP, said Michael DiBiase, president of the RIPEC — it does not come out of nowhere. State GDP has been on the rise since the 1990s, according to the U.S. Bureau of Economic Analysis. The only major dips took place in the wake of the 2008 financial crisis and the COVID-19 pandemic.

Rhode Island employment lagged behind regional and national numbers

While growth in GDP exceeded expectations, the state’s overall unemployment rate rested at 4.6% through the end of 2024. This surpassed the national and regional rates of unemployment, which stand at 4.1% and 3.5% respectively, according to a Feb. 4 RIPEC press release.

Although the job market is “thriving in terms of opportunities,” Colella said, these numbers don’t show what unemployed Rhode Islanders “have to go through.”

There is a “mismatch” between the available job postings and the skill sets of unemployed individuals, DiBiase explained. Landing an available job, Colella added, is “a brutal process.”

Compared to neighboring states, DiBiase said, Rhode Island has lower levels of educational attainment — defined by the U.S. Census Bureau as the “highest level of education a person has completed.”

The higher your education attainment level, DiBiase explained, “the more jobs you can actually attain.” 

In Colella’s view, the mismatch between jobs and workers is not caused by a misalignment of skill, though, but rather an issue with the system.

 “They have education and training,” he said. “What they don’t have is a network into major employers.”

“It’s a broken, failed, fragmented, impersonal system,” he added. “The recruiters don’t fail. It’s the process.”

Leisure and hospitality saw declines in employment

Out of all job sectors in Rhode Island, leisure and hospitality was the only one that experienced a decrease in employment from quarter 3 in 2023 to the same period in 2024. 

While the leisure and hospitality sector “rebounded” in the last quarter of 2024, employment still lies below where it was a year ago, DiBiase said. 

There has been “a reshuffling of positions” within the hospitality industry, said George Cook, a banquet attendant at the Omni Hotel in Providence. 

Carmine Rondinelli, the director of operations at the Omni Hotel’s Providence location, also has not noticed a large change in employment. “We’ve been relatively steady,” he said.

The sector “often gets a bad rap,” DiBiase said, even though it plays an important role in the state’s economy.

But to gain an accurate picture of Rhode Island’s economic standing, it’s necessary to study the “longer trends,” he added. “The fact that we’re kind of in line with the region and significantly ahead of the U.S. is still pretty positive.”