URBANA — The University of Illinois Flash Index for May 2023 increased to 103.2 from 102.9 in April. This continues the perplexing path of the U. S. and Illinois economies with most observers still waiting for at least a mild recession that has yet to materialize.
“Reversing last month’s weak performance, Illinois tax receipts (the major components of the Flash Index) for May were surprisingly robust.”
Both individual income and corporate tax receipts were up in real terms compared to May 2022 while sales tax receipts were down only slightly after adjusting for inflation. Even more confounding, both the national and Illinois unemployment rates declined, falling in Illinois to 4.2% to a post-Covid recession low.
“It is still too early to claim a soft landing following the strong recovery from the recession. Watchful waiting continues.”
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 revenues 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 May 31, 2023. Over three years since the beginning of the COVID-19 crisis, ad hoc adjustments are still needed.
“It is still too early to claim a soft landing following the strong recovery from the recession. Watchful waiting continues.”