U of I Flash Index up in February

March 2, 2020

 U of I Flash Index up in February

State's economy continues growth despite coronavirus concerns


Under the cloud of the coronavirus, the U of I Flash Index in February actually rose to 105.7 from its 105.4 reading in January. 

This suggests that the economic impact of the coronavirus has yet to register in Illinois. Given the recent sharp decline in the stock market on pandemic fears, it is likely that Illinois will feel the effects in future months.

“The index is at its highest reading in over four years, but this is little comfort given the impending threat of possible coronavirus effects,” said University of Illinois economist J. Fred Giertz, who compiles the monthly index for the Institute of Government and Public Affairs. The last time the index was higher than 105.7 was November 2015, when it stood at 106.1. See the full Flash Index Archive. 

“The state may also have benefited from the extra February day of Leap Year because the month’s results are compared to recent years with one fewer day,” Giertz added. However, he said it is impossible to isolate the impact of the additional day. 

Two components of the index, individual income tax and sales tax receipts, increased while the corporate tax receipts fell slightly compared with the same month last year after adjusting for inflation. The lower corporate receipts may be a response to strong revenues over the last quarter of 2019.

The Illinois unemployment rates have not been released for January, but the unemployment rate is likely to have remained very low.

The Flash Index is a weighted average of Illinois growth rates in corporate earnings, consumer spending and personal income as estimated from receipts for corporate income, individual income and retail sales taxes. These 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 February 29, 2020. 

Research Area: Fiscal Health of Illinois

Policy Initiative: none