U of I Flash Index rebounds in March

April 3, 2017

U of I Flash Index rebounds in March


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The University of Illinois Flash Index bounced back in March after dipping slightly the previous month. The measure of economic activity in Illinois was 104.4 last month, returning to the same level is was in January. The index, which is published by the University’s Institute of Government and Public Affairs, dipped to 104.1 in February.

“Amid economic and political turmoil globally, nationally and in the state of Illinois, the economy appears to be strengthening,” said economist Fred Giertz, who has compiled the index since 1998.  “Growth estimates for the U. S. have been increased for 2017 with the economy nearing full employment. Consumer confidence is the highest since 2000.”

February’s dip followed two consecutive months of increase. The index has remained between 104 and 105 since last July. Any reading over 100 indicates economic growth, while readings under 100 indicate the economy is retracting.

In March, Illinois also experienced a decline in unemployment to 5.4 percent, the lowest since the beginning of the recession in 2007 and less than one-half of the 11.2 percent high in 2010. Despite this relatively good news, Illinois’ problems (most notably the long-term state budget imbalance and the ongoing impasse in Springfield) still threaten the state’s expansion, Giertz said.

Individual income tax receipts in March were up from the same month last year after adjusting for inflation while sales tax receipts were down slightly. Corporate tax receipts remain non-comparable to past years because of new processing procedures in the Department of Revenue.

The Flash Index is a weighted average of Illinois growth rates in corporate earnings, consumer spending and personal income. Tax receipts from corporate income (estimated), 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, 2017.

Research Area: Fiscal and Economic Policy

Policy Initiative: none