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Flash Index of Illinois economy down in September

J. Fred Giertz, Institute of Government and Public Affairs
217-244-4822

Mark Reutter, Business Editor
217-333-0568

10/01/2003

EDITORS, NEWS DIRECTORS: The Flash Index of Economic Growth, produced by University of Illinois at Urbana-Champaign economists, is based on the most up-to-date information on the state economy.

CHAMPAIGN, Ill. — In a surprising development, the University of Illinois Flash Economic Index dropped in September, indicating no apparent pickup in the Illinois economy.

The September reading of 96.2 – down from 96.7 in August – is at odds with generally positive signs about the national economy. This was the lowest Index reading since last April.

“While the September downturn may be an aberration since one month is never significant by itself, the information is disquieting,” said J. Fred Giertz, the University of Illinois economist who released the Flash reading today.

“It seems that every time the economy is poised for a break out of its recent slow recovery mode, it stumbles,” Giertz said. “Time will tell whether this is a minor stumble or a more serious spill.”

The Index has been below 100, the break-even mark between economic growth and contraction, since May 2001.

Sales-tax receipts in Illinois were up from September a year ago, but individual and corporate income taxes were both down.

The Flash 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.

line chart showing Flash Index down in September