Meeting Notice
DATE: Tuesday, February 7, 2012
TIME: 10:00 a.m.
PLACE: Room 212, Capitol Building, Springfield, Illinois
TOPIC: Continued Discussion on the Proposed Closures of Jacksonville Developmental Center and Tinley Park Mental Health Center
January 2012 Monthly Briefing
ECONOMY: HAPPY HOLIDAYS
Edward H. Boss, Jr., Chief Economist
Most analysts would agree the number one concern in the economy is the lack of jobs. And, to that end, most attention has centered on the unemployment rate, both in the press and from the Administration. Illinois’ unemployment rate dipped to 9.8% at year-end from 10% in November, its lowest reading since July. Even so, it was still higher than a year earlier when it was at 9.4% and compares to a current national rate of 8.5%. Illinois’ current unemployment rate is significantly higher than some nearby states. Even Michigan, which often had the highest rate during the past recession, recorded a lower rate of 9.3% at year-end, Indiana a 9.0% rate, while Ohio had 8.1%, Missouri an 8.0% rate and Wisconsin an unemployment rate of 7.1%.
While the unemployment rate may be the symbol of the employment picture, it is perhaps even more important to analyze the performance of non-farm payroll jobs. Moreover, when comparing Illinois to the nation, payroll employment for the nation had recovered its pre-recession level following the 2001 recession by early 2005. In contrast, Illinois never did recoup all the jobs lost during that recession before the next recession began, making the gap to reach a new high much more difficult. Thus, Illinois’ job picture, while improving, continues to lag that shown for the nation as a whole as well as its surrounding states.
REVENUE: JANUARY REVENUES POST DECENT GAINS DESPITE WEAK FEDERAL SOURCES
Jim Muschinske, Revenue Manager
While federal sources again suffered a significant drop, overall base revenues were fairly positive in January, posting gains of $576 million. For the month, virtually all non-federal revenue sources managed to post gains. It should be mentioned that we are now beginning to compare against the post-income tax period of last year. As a result, rates of growth will slow over the remainder of the year.
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While the Commission is not scheduled to release its official FY 2013 estimate until a planned CGFA meeting early in March, after the Governor’s release of the Three-Year Budget Plan, a number of inquiries indicated a heightened interest in next year’s revenue outlook. To address that, we have prepared a preliminary overview of FY 2013 expectations. For comparison purposes, the Governor’s Office of Management and Budget’s FY 2013 estimate, as presented in the just released Three-Year Budget Projection, also will be displayed. As shown, a preliminary estimate of FY 2013 estimate yields a figure of approximately $34.3 billion reflecting estimated growth of $900 million. Those figures are quite similar to the GOMB estimates of $33.1 billion and $990 million in growth. Underlying assumptions include continued modest rates of growth in the economic sources as well as recent legislative changes enacted in the fall veto session. The federal source estimate reflects the Administration’s planned spending on reimbursable programs per their Three-Year Budget report. Obviously, the federal source number will be affected by final appropriations as well as available resources.