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Flash Index continues slow upward climb
The Flash Index increased in January to 107.2 from its 107.0 level in December. This marks a new post-recession high, or the highest level since April 2007 (see archive). The index remains well above 100, the dividing line between growth and decline, meaning the Illinois economy continues to grow at a slow but steady pace.
“Some of the initial optimism this year about the national economy has been tempered by global financial concerns, this time in emerging markets instead of southern Europe,” said J. Fred Giertz, who complies the Flash Index for the Institute of Government and Public Affairs. Despite these concerns, GDP grew in the last quarter of 2013 at 3.2 percent following a 4.1 percent rate for the third quarter. "Growth in the 3 to 4 percent range is necessary to produce job growth that will reduce the unusually high levels of unemployment that have marked this recovery," Giertz said.
Illinois’ unemployment rate fell to 8.6 percent in December, tying the lowest level since the end of the recession. Illinois’ recovery has been much slower than the national recovery. At the end of the recession in June 2009, Illinois’ unemployment rate was 0.6 of a percentage point above the national rate. Now the Illinois rate is 1.9 percentage points above the national level and lower than only two other states.
Corporate tax receipts were up strongly in real terms compared to the same month last year while sales tax receipts were up around 3 percent. Individual income tax receipts were down by a fraction of a percent.
The Flash Index is a weighted average of Illinois growth rates in corporate earnings, consumer spending and personal income. Tax receipts from corporate income, personal income and retail sales are adjusted for inflation before growth rates are calculated. The growth rate for each component is then calculated for the 12-month period using data through January 31, 2014.