CHAMPAIGN, Ill. The University of Illinois Flash Index dropped to 94.2 in May from its 95.0 level in April. This is the 13th straight month of negative growth for the state economy and lowest monthly Flash reading in more than 10 years.
"A disconnect persists between reports about the rebound of the national economy and the relatively weak performance of the Flash Index," said J. Fred Giertz, the economist at the University of Illinois at Urbana-Champaign who released the data today.
"Gross Domestic Product rose significantly in the first quarter of 2002 and productivity has remained strong. There are, however, nagging doubts about the existence and strength of the recovery," Giertz said.
Two components of the Flash Index individual income-tax receipts and corporate-tax receipts were down significantly for May. This weakness in receipts over the past year has led to serious budget problems facing the state of Illinois. A year ago in May the Flash Index stood at 98.9.
"If the recovery is indeed under way, the Flash Index should begin to increase in the near future," Giertz said.
The Flash Index is a weighted average of state 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.
