The University of Illinois Flash Index dropped again in April to 95.0 from its 96.3 level in March. This is the lowest reading of the Index since February 1992.
The Index, which charts the state of the Illinois economy, provides no comfort for those looking for signs that the recession is at an end. Last months number marks the 12th straight month that the Index has been below 100, indicating a contraction of the state economy. A year ago in April, the Index was 101.3, indicating modest growth.
“There have been mixed economic signals of late regarding the national economy,” said J. Fred Giertz, an economist who released the Flash data today. “The first-quarter Gross Domestic Product showed strong growth, but there is concern that the expansion has already stalled.”
It should be noted that the Flash Index is a composite measure of the states economic performance and is not designed to track personal income or output directly. “The inclusion of corporate tax receipts in the Index makes it more volatile than income or output,” Giertz said. “But it also gives a better picture of the states economic momentum than these more stable measures.”
The performance of the Index is consistent with the state revenue picture where tax receipts have been very weak for the last few months. In the recession in the early 1990s, the Flash Index remained below 100 for nearly three years. This suggests that it will take sometime for the Index to move back to 100, possibly several months after the actual recession (as officially determined) ends.
The Flash Index is a weighted average of Illinois growth rates in corporate earnings, consumer spending and personal income. The growth rate for each component is calculated for the 12-month period using data through April 30.
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