Flash Index remains in narrow growth range for April

May 1, 2017

Flash Index remains in narrow growth range for April


The University of Illinois Flash Index fell slightly in April to 104.3 from its 104.4 level in March. The index, which measures economic activity in Illinois, has remained within a range of 104.1 to 104.4 for the past six months and between 104 and 105 for the past 10 months. View the full Flash Index archive.

This minimal monthly movement in the index reflects an economic picture of conflicting signals that apparently offset each other with the result of little change, said economist J. Fred Giertz, who compiles the Flash Index for the university’s Institute of Government and Public Affairs.

“The early first quarter GDP growth numbers came in weaker than expected, increasing at only at a 0.7 percent pace, the lowest in two years and continuing the recent pattern of slow first quarter growth,” Giertz said. “While politicians are suggesting that a 3 percent-plus growth rate is attainable, the economy is struggling to reach an annual 2 percent rate. 

“In Illinois, the budget stalemate continues with impacts on public higher education and social service providers becoming more serious,” Giertz said.

Nevertheless, consumer sentiment continues high and the financial markets remain strong on seemingly optimistic expectations about tax reform and deregulation, he said. Illinois experienced a marked decline in unemployment rate to 4.9 percent, the first time below 5 percent since June 2007, and less than half the post-recession high of 11.2 percent in January 2010.

Individual income tax receipts in April were up from the same month last year after adjusting for inflation while sales tax receipts were down. 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 April 30, 2017.

Research Area: Fiscal Health of Illinois

Policy Initiative: none