U of I Flash Index bounces back in September

October 1, 2021

 U of I Flash Index bounces back in September

Authors

The University of Illinois Flash Index in September rebounded to 106.0 from the 105.6 level last month.

The September reading matched the post-Covid crisis high achieved in June of this year. See the full Flash Archive. 

“This is a surprising result because of concerns about the resurgence of the Delta variant of COVID-19 and the fear of a return to closures and shutdowns, said University of Illinois economist J. Fred Giertz, who compiles the monthly index for the Institute of Government and Public Affairs. “So far in Illinois, this does not appear to have slowed the state’s economy.”  

The Illinois unemployment rate dropped slightly to 7% from last month’s 7.1% level. Illinois’ recovery as measured by unemployment has been slower than the national economy that produced a 5.2% rate. 

State tax collections for September can provide a ready estimate of growth in the Illinois economy and were up strongly compared to the same month last year, after adjusting for inflation.

While both individual income tax and sales tax receipts increased significantly over last year, corporate revenues registered a phenomenal rise of more than 75%, the second-largest monthly total in history. “Clearly, this reflects more than just an expanding economy, most likely a change in the pattern of monthly receipts over the year compared to the past,” said Giertz.

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 September 30, 2021. Even though more than a year has passed since the beginning of the COVID-19 crisis, ad hoc adjustments will still be needed for some time because of the timing of the tax receipts resulting from state and Federal changes in payment dates both this and last year. 

 


Research Area: Fiscal and Economic Policy

Policy Initiative: none

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