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Lots more work needed on growing the state’s economy

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* “Overall, Illinois’ economic and financial position has improved in recent years, but it still lags behind other states and the country as a whole,” is the conclusion of Benjamin L. Varner, Chief Economist for the Commission on Government Forecasting and Accountability. The numbers are not good. Let’s start with Gross Domestic Product

During the first quarter of 2024, Illinois’ economy contracted by 1.3% on an annualized basis, ranking 45th among the states and the District of Columbia. … The U.S. as a whole grew by 1.4% during this period.

To analyze growth since the outbreak of COVID-19, the Commission compared real GDP growth since the fourth quarter of 2019. The United States has grown 8.6% post-COVID-19, one of the highest rates among advanced economies. In contrast, Illinois’ economy has grown only 2.8%, ranking 46th

* Nonfarm Payroll Jobs

Employment levels in May 2024 were compared to May 2023 and February 2020, the last month before significant declines during the COVID-19 pandemic. In May 2024, Illinois had approximately 6.15 million payroll jobs, an increase of about 44,000 jobs compared to 2023. … On a percentage basis, this growth equated to just 0.7%, ranking 45th. […]

The U.S. now has just over 6.2 million more jobs than in February 2020, representing 4.1% growth. Illinois, on the other hand, has barely surpassed its pre-COVID-19 level, with approximately 14,000 more jobs in May 2024 than in February 2020, equating to only 0.2% growth. This ranks Illinois 45th in the nation.

* Unemployment Rate

Over the last decade, Illinois has consistently been about 0.8% to 0.9% above the U.S. average. In May 2024, preliminary data indicates that Illinois’ seasonally adjusted unemployment rate was 4.9%, which is 0.9% higher than the U.S. average of 4.0%, ranking 47th among the states and the District of Columbia. Over the last year, Illinois’ unemployment rate increased by 0.7 percentage points, from 4.2% to 4.9%. This increase is higher than the average state increase of 0.4% and the national increase of 0.3%.

* Personal Income

During the first quarter of 2024, Illinois had a seasonally adjusted total income of approximately $912 billion at an annual rate, the fifth highest in the country. The year-over- year change from the first quarter of 2023 to the first quarter of 2024 was 3.7%, which was below the U.S. growth rate of 4.4%. Illinois’ growth over the previous year ranked 40th. […]

Illinois was similarly one of the slowest-growing states regarding total income growth since the outbreak of COVID-19. Since the fourth quarter of 2019, Illinois’ total income grew by 22.0%, significantly below the U.S. increase of 27.2%, ranking 46th over this period.

Emphasis added.

Isabel posted Brenden Moore’s story earlier today about Gov. JB Pritzker’s quest to expand the state’s economy. It’s a really good piece and you should read it. But, obviously, there’s so much more work to be done.

posted by Rich Miller
Monday, Jul 8, 24 @ 10:44 am

Comments

  1. Pretty stark statistics. But the Governor is trying. The US economy is so far beyond the “free market” phase that strategic investments and support is the only way. Big tax cuts and deregulation, popular with Republicans, just don’t cut it anymore.

    Comment by Sir Reel Monday, Jul 8, 24 @ 10:57 am

  2. That is s great post really breaks it down. Those are real unbiased numbers and they are not good. The level of taxation in Illinois has to play a huge role in this stagnation but its very unlikely anything will change there. The gov a pretty smart guy and has contacts at the highest level of business worldwide so there is hope. Time will tell

    Comment by Regular democrat Monday, Jul 8, 24 @ 11:02 am

  3. The QC region has been hit hard with layoff notices at John Deere (650 jobs). When Deere sneezes the region gets a cold.

    Comment by nothing runs like a deere Monday, Jul 8, 24 @ 11:05 am

  4. It is what it is.
    6 years of Pritzker and the results are clear.
    We live in a great state. We just have to work on better leadership alternatives.

    Comment by Back to the Future Monday, Jul 8, 24 @ 11:35 am

  5. IL unemployment rate is at a historic low. I get the sky is falling narrative but for some reason IL stats just don’t fit into these boxes as well as other states. I’d be more curious to see where IL falls among comprobable states instead of all states. Of course IL salaries didn’t grow as fast as some other states, because we already had much higher salaries to start with. It makes more sense to look at these states among comprobable states. I acknowledge there is more work to be done, but I don’t think these stats tell a complete story.

    Comment by blues Monday, Jul 8, 24 @ 11:53 am

  6. This is not a good report. Being the 5th largest state in the country and yet we seem to be in the bottom 5 of many of the high-level Economic factors that decide how healthy a state is, is not good.
    Hopefully the state has a good jobs June report, we are only .1% away from having 5% unemployment.

    Comment by Frida's boss Monday, Jul 8, 24 @ 12:12 pm

  7. The population is growing less than the nation as a whole, so it makes sense for these absolute stats to be poor relative to other, faster-growing states.

    More interesting measures would be things like median household income, quality of life, crime rates, and median life expectancy. These are per capita measures that matter to everyday people (the unemployment rate example falls into this category).

    As a country, we are so obsessed with growth for growth’s sake. Growth should not be the end goal, it is a tool to help improve quality of life.

    Comment by supplied_demand Monday, Jul 8, 24 @ 12:17 pm

  8. We have so many things going for us but we just don’t leverage them properly because at so many opportunities we tell employers they aren’t welcome. We have: middle of the country, easy access to fresh water, two international airports (three if you include St. Louis), robust rail network, multiples colleges and universities, diverse workforce, good highways and roads, just to name a few.

    Related - I saw a press release from the Mayor last week that a bunch of new Chicago business regulations is going to grow the economy. Boy, he just doesn’t get it, does he?

    Comment by Just Me 2 Monday, Jul 8, 24 @ 12:32 pm

  9. ==Of course IL salaries didn’t grow as fast as some other states, because we already had much higher salaries to start with.==

    Personal income: CA grew 8.2%. NY grew 7%. PA grew 6.9%. NJ grew 5.7%.

    All valid comps.

    Comment by City Zen Monday, Jul 8, 24 @ 12:33 pm

  10. I can’t quite tell from the underlying story what is being compared. If they’re simply comparing rates, that doesn’t tell us anything. When you look at the charts comparing the states, most of the big increases occurred in small states, where the law of small numbers will lead to larger rate increases. A hundred new jobs in New Hampshire is going to affect its unemployment rate a whole lot more than 100 new jobs in Illinois.

    Comment by Duck Duck Goose Monday, Jul 8, 24 @ 1:25 pm

  11. – Big tax cuts and deregulation, popular with Republicans, just don’t cut it anymore –

    Well, I guess that settles it. More taxes and regulations it is. Gotta solve the problems somehow

    Comment by JB13 Monday, Jul 8, 24 @ 1:34 pm

  12. The Illinois GOP dilemma: how to blame Pritzker for these numbers without crediting Biden for the national numbers.

    Comment by Proud Papa Bear Monday, Jul 8, 24 @ 1:49 pm

  13. I’m just poking around county level data on some of those metrics and haven’t found full 2023 data sets yet but looking at 2022 the personal income data looks like they largely went into reverse statewide outside of greater Chicagoland? https://www.bea.gov/sites/default/files/2023-11/lapi1123.pdf

    Comment by ChicagoBars Monday, Jul 8, 24 @ 2:59 pm

  14. The difference between “growing” and “absolute” levels is well-illustrated by the “fastest growing” vs the “most popular” sports: pickleball/alpine_touring/winter_fat_biking vs biking/bowling/fishing.

    Comment by Ben Tre Monday, Jul 8, 24 @ 3:17 pm

  15. ==they largely went into reverse statewide outside of greater Chicagoland?==

    Specifically, the collar counties all outperformed Cook. More credit goes to the land in Chicagoland.

    Comment by City Zen Monday, Jul 8, 24 @ 3:33 pm

  16. Start your business in Illinois and help us pay off the state’s $200B in unfunded liabilities. Did I forget to tell you about our high property taxes and overly litigious legal environment? There is a reason NY, Cali and Illinois are losing ground, yet the ruling party can’t admit that debt, taxes, overspending and lawsuits have anything to do with a state’s economic competitiveness.

    Comment by Anon Monday, Jul 8, 24 @ 5:00 pm

  17. Anon is spot on. Illinois is awful for businesses. The Illinois Dems are hopeless to fix this.

    Comment by Ben Monday, Jul 8, 24 @ 5:23 pm

  18. Don and Chris take their marching orders from public unions. Public unions who run the state and have ruined it.

    Comment by Ben Monday, Jul 8, 24 @ 5:25 pm

  19. “ There is a reason NY, Cali and Illinois are losing ground,”
    City Zen’s comment dispels 2/3 of your argument.

    Comment by Proud Papa Bear Tuesday, Jul 9, 24 @ 3:10 am

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