Rhode Island Rising: Igniting the Ocean State's Economic Comeback
A Bold Roadmap to Attract Businesses, Create Jobs, and Build a Thriving Future in 2026 and Beyond
Reviving Rhode Island: A Roadmap to Attracting Businesses Back to the Ocean State
In the heart of New England, Rhode Island—affectionately known as the Ocean State—has long been a hub of innovation, from its historic role in the Industrial Revolution to its modern strides in biotechnology and renewable energy. Yet, as we wrap up 2025, the state grapples with persistent economic hurdles: a sluggish business climate ranked 46th nationally by CNBC, rising unemployment at 4.7%, and high-profile departures like Hasbro’s relocation to Boston’s Seaport district. These exits highlight deeper issues, including regulatory burdens, talent shortages, and competition from neighboring states like Massachusetts. But there’s hope on the horizon. With strategic initiatives like the “Ocean State Accelerates” five-year economic plan, Rhode Island is positioning itself for a comeback. This blog post dives into actionable strategies to bring businesses back, drawing from official plans, recent updates, and expert insights. Whether you’re a policymaker, entrepreneur, or resident, here’s how we can turn the tide.
Understanding the Challenges: Why Businesses Are Leaving and What It Means for 2025
Rhode Island’s economy in 2025 shows mixed signals. While non-farm employment hovers near historic highs and consumer demand grows modestly, concerning trends persist: WalletHub ranks it dead last for starting a business, and Q2 2025 KPIs reveal stagnation in revenue growth and workforce participation at just 63.5%. Factors driving companies away include high taxes—such as the corporate minimum tax and recent hikes in minimum wage and gas taxes—coupled with infrastructure woes and economic uncertainty from federal policies.
Take Hasbro’s move: The toy giant cited Boston’s tech ecosystem and talent pool as draws, leaving behind a legacy of philanthropy in Rhode Island. Similarly, global distribution challenges and tariffs have hit manufacturers hard. But these exits aren’t inevitable. By addressing root causes through targeted reforms, Rhode Island can reverse the outflow. The state’s “RI 2030” plan emphasizes holistic growth, focusing on education, housing, and climate resilience to create a more attractive environment.
Leveraging Incentives and Tax Reforms: Making Rhode Island Competitive Again
One of the most direct ways to lure businesses is through financial incentives. The Qualified Jobs Incentive Tax Credit stands out, offering up to $7,500 per new job annually for up to 10 years to companies creating or relocating positions—requiring at least 10 jobs for most firms. In June 2025, Governor McKee announced new incentives for job creation, innovation, and development projects, totaling over $45 million in tax benefits distributed to 21 businesses in FY 2025.
Tax reforms are crucial too. Advocates call for eliminating the corporate minimum tax, boosting the estate tax exemption, and avoiding new personal income tax hikes to enhance regional competitiveness. Programs like the Innovation Voucher Initiative provide grants up to $75,000 for R&D collaborations, while the Invention Incentive offers $5,000 for patent filings. For underserved entrepreneurs, the Minority Business Accelerator and $62 million in SSBCI funds ensure equitable access to capital. These tools, if expanded, could mirror successes in states like Massachusetts, where similar credits have spurred tech booms
Focusing on High-Growth Sectors: Betting on the Blue Economy and Beyond
Rhode Island’s future lies in its strengths: the blue economy, biosciences, advanced manufacturing, and renewables. The Ocean State Accelerates plan targets these, aiming to create 700,000 job openings amid limited workforce growth. Offshore wind is a star performer—the Revolution Wind project is set to deliver 400MW by late 2025, positioning Rhode Island as a leader in ocean tech via the RI Blue Economy Technology Cluster.
Defense, shipbuilding, aquaculture, and tourism also offer opportunities, with investments like $35 million for offshore wind ports and $60 million for Quonset Business Park upgrades. Providence’s innovation district is buzzing with startups in tech and life sciences, supported by the RI Life Science Hub’s infrastructure and New Business Attraction Program. Food systems, including local agriculture and processing, could add vibrancy—think expanding aquaculture to boost exports. By prioritizing these sectors, Rhode Island can attract foreign direct investment through its Foreign Trade Zone and competitive grants.
Investing in Infrastructure and Sustainability: Building for Tomorrow
Infrastructure is a make-or-break factor. Rhode Island ranks high in broadband access (#3 nationally) but lags in other areas. The plan calls for developing industrial sites, waterfronts, and labs, with $45 million for life sciences wet labs and climate-resilient planning to reach 100% renewables by 2033. Modernizing grids for EVs and enhancing transportation choices—via expanded rail and ports—will support supply chains.
Sustainability ties in: Embedding green practices attracts eco-conscious firms. Grants for sustainable operations and digitization can help small businesses (98% of RI firms have under 100 employees) adapt. Placemaking grants, like the $2.9 million awarded in 2025 for streetscapes and historic regeneration, make communities more livable, drawing talent.
Streamlining Regulations and Government Processes: Cutting Red Tape
Bureaucracy stifles growth. Ocean State Accelerates proposes ongoing reviews of licensing barriers, a digital Biz Builder portal with chat support and multilingual resources, and a Taxpayer Advocate for compliance help. Implementing LEAN processes and cybersecurity enhancements will make government more efficient.
Resisting new regulatory burdens is key—experts warn against adding more, focusing instead on emergency preparedness and supply chain security. For foreign companies, simplified payroll and compliance via EOR services ease entry.
Building Workforce and Community Strength: People Power the Economy
Talent is Rhode Island’s greatest asset. Link education to industry through apprenticeships, paid internships, and the Work Based Learning Navigator, targeting underrepresented groups. Address barriers like childcare and housing to boost participation.
Support small businesses via Supply RI for local supplier connections and eProcurement training. Succession planning for aging owners (56% over 55) using ESOPs prevents closures
Marketing, Outreach, and Retention: Telling Rhode Island’s Story
Data-driven retention is vital—use surveys and fit-gap analyses to target expansions. Partner with RI Commerce, universities, and associations for networking. Highlight assets: proximity to Boston and NYC, educated workforce, and natural beauty in campaigns.
Recent wins include UNFI consolidating its HQ in downtown Providence and top startups emerging in tech. Metrics like job growth and FDI will track progress under the plan’s timelines.
Conclusion: A Call to Action for Rhode Island’s Renaissance
Bringing businesses back requires bold, collaborative effort. By implementing Ocean State Accelerates—focusing on incentives, sectors, infrastructure, and people—Rhode Island can reclaim its edge. As Governor McKee noted in his 2025 State of the State, priorities include education and economic opportunity. Stakeholders must unite: advocate for reforms, invest in innovation, and promote the state globally. The Ocean State’s future is bright—let’s accelerate it together.