CHAMPAIGN, Ill. - The University of Illinois Flash Economic Index increased in May to 96.8, up from its 96.0 level in April and the highest reading of state economic activity since February 2002.
"While this is encouraging news, much of the improvement stems from the fact that last May was an extremely weak month," said J. Fred Giertz, the Illinois economist who released the Flash reading today. The Index still is below the 100 dividing line between economic growth and contraction.
The current recession "has been long and perplexing with frequent hints of recovery that have later proved illusory," Giertz said. "The last two years have also been marked by a number of events that have complicated the economic picture, including the Sept. 11 attacks, the corporate and accounting scandals, and the uncertainty regarding a war with Iraq."
Upward movement of the Flash over the next few months will indicate whether the Illinois economy has actually turned a corner and entered a period of sustained recovery.
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 May 31.