As I had noted in my prior posts, historically it has been very unusual for there to be more than a 1.5% difference (either more or less) between the unemployment rates if Massachusetts and Rhode Island.
Lately though, we are seeing a historically unusual spread between Rhode Island’s high and accelerating rate and Massachusetts’ far lower but rising rate.
In fact, the current 3.7% spread now significantly exceeds all spreads seen in at least 40 years.
This indicates that either Rhode Island’s current rate would need to fall dramatically or the Massachusetts rate would need to increase sharply…. My sense, especially in light of the financial turmoil seen since September, is that Mass will be the one playing catch-up.
Today’s state and regional unemployment report shows that, in November, the Rhode Island unemployment rate rose again to 9.6% while the Massachusetts rate jumped to 5.9%.
In November, Massachusetts experienced the largest year-over-year gain since the recessionary environment that followed the tech-led dot-com bust forcing the spread between Rhode Island and Mass to shrink slightly for the first time, to 3.7%, indicating that Mass may finally have reached a point of explosive unemployment growth that will ensue over the next several months.