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Flash Index of Illinois economy indicates moderate expansion taking place

J. Fred Giertz, Institute of Government and Public Affairs, 217-244-4822
Mark Reutter, Business Editor, News Bureau 217-333-0568

3/2/2005

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

CHAMPAIGN, Ill. — The University of Illinois Flash Economic Index rose to 103.4 last month from its 103.1 reading in January. February’s results continue to confirm that the Illinois economy is expanding at a moderate pace after a slow recovery from the 2001 recession.

The Flash Index edged above the 100 reading last April and has continued to improve from this base, which marks the divide between economic growth and contraction. A year ago last February, the Index was at 99, and in February 2003, the reading was 95.6.

Two of the three components of the Index were up in real (inflation-adjusted) terms, said J. Fred Giertz, the University of Illinois economist who compiles the data.

Sales-tax receipts increased moderately last month from the same month in 2004, while corporate-tax receipts advanced sharply (although February is historically a month of low receipts). Individual income in Illinois was virtually unchanged from a year ago.

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 Feb. 28.

line chart showing upward trend of economic growth