Illinois continues to show steady recovery from its worst economic doldrums since the early 1980s, but the progress remains slow, according to a leading measure of the state’s economic activity.
The UI Flash Index climbed to 93.5 in September, up from 92.0 in August. The index remains below the 100 level that divides decline from growth, but the 1.5-point jump is the largest one-month increase in six years.
“The increase is good news because it suggests that the economy is not weakening as feared several weeks ago and that a double dip recession is less likely,” said economist J. Fred Giertz, who compiles the index for the UI Institute of Government and Public Affairs. “This is reinforced by the continued decline in the Illinois unemployment rate, which fell from 10.3 to 10.1 in August. The recovery is still painfully slow, but at least it is continuing,” Giertz said.
The recent increase is the largest jump in the index since it climbed from 100.5 to 102.2 between August and September 2004.
In real terms, corporate and sales tax collections increased in September from the same month last year while individual income tax receipts were down slightly.
The index is a weighted average of Illinois growth rates in corporate earnings, consumer spending and personal income. Tax receipts from corporate income, 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 Sept. 30, 2010.
