The Illinois economy continues to contract in the face of the global recession, with a leading indicator falling to its lowest point in more than six years.

 The University of Illinois Flash Index, the first barometer of the state’s economy each month, dropped to 95.3 in March. The drop of one full point since February continues a steady decline since the financial crisis in August last year.

The March reading is the lowest since November 2002, when the state was emerging from the recession of 2001.

“There is strong reason to believe that the decline will continue,” said economist J. Fred Giertz, who compiles the Flash Index for the Institute of Government and Public Affairs. “The current 95.3 reading is still above the low points of the 1990 and 2001 recessions, which were likely much less severe than the current downturn.

“If, as many people believe, the current recession is among the most severe since World War II, the index is likely to continue its slide, probably well below 90,” Giertz said.

The low point of the index was 85.9 in April 1983, a result of the twin recession of the early 1980s.

In real terms, individual income tax receipts, corporate tax receipts, and sales tax receipts – the three components of the Flash Index -- were below their levels of the same month last year.

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 March 31, 2009.