URBANA – The Illinois economy is growing at its highest rate since 2015. That’s according to the latest University of Illinois Flash Index.
Listen to this story here.
The Flash Index measured the state’s economy at 106.0 for June, well above the 100-level that divides growth and decline.
The June reading is higher than May’s reading of 105.3, and much higher than in June 2020, when the Flash Index measured 93.1, beginning a period of higher readings following a steep plunge caused by the COVID-19 pandemic.
And the Flash Index reading is even higher than during the months just before the pandemic. During that period, it peaked at 105.7 in February 2020, just before the impact of the coronavirus outbreak brought the Flash Index below 100.
The Flash Index is based on Illinois tax receipts. And U of I economist Fred Giertz says those receipts have risen sharply in recent months.
“And for the three major taxes, the income tax, the corporate tax and the sales tax, it was higher than the last year, which is not surprising, because of the pandemic,” said Giertz, who prepares the Flash Index for the U of I’s Institute of Government and Public Affairs. “But it’s even higher than the year before. So we seem to have come back very strongly.”
And Giertz says Illinois government’s usually shaky fiscal picture is looking better as well.
“The only problem here is that a lot of that came again from stimulus money,” said Giertz, referring to federal stimulus funds passed by Congress to help workers, businesses and state and local governments cope with the COVID-19 pandemic. “That’s not going to continue forever.”
Giertz says after the federal stimulus money runs out, Congress may have finally agreed on infrastructure legislation that could pump more money into the Illinois economy. And, he says the economy may also benefit around that time from the pent-up demand of consumers coming out to spend in a reopened economy.