Realized after typing this that I should have changed the width of the rectangle in the render function. Since create function won't be run again.
The following code works properly.
public void render() {
Gdx.gl.glClearColor(0, 0, 0, 1);
Gdx.gl.glClear(GL10.GL_COLOR_BUFFER_BIT);
rectangle.width = 5; // Change this line while debugging.
rectangle.height = 10;
shapeRenderer.setProjectionMatrix(camera.combined);
shapeRenderer.begin(ShapeRenderer.ShapeType.Filled);
shapeRenderer.setColor(1, 1, 0, 1);
shapeRenderer.rect(rectangle.x, rectangle.y, rectangle.width, rectangle.height);
shapeRenderer.end();
camera.update(); // only if we're moving the screen though
}