JOBS

·        Illinois unemployment rate matches record low.  The 4.1% unemployment figure reported by the Illinois Department of Employment Security (IDES) matches the lowest number ever posted for this figure, a widely-cited index of economic health and activity in Illinois.  Preliminary data, which is subject to revision as more numbers come in, indicates that nonfarm payroll total employment increased in the Land of Lincoln by 2,800 jobs in September as opposed to August 2018.  The same figure, when counted on a year-to-year basis (September 2017 to September 2018) showed a net gain of more than 50,000 nonfarm payroll jobs. 

September 2018 job creation was especially strong in education, construction, and manufacturing.  The Illinois manufacturing economy created an estimated 2,300 net new jobs in September 2018 alone, and created 14,600 new factory jobs over the past 12 months.  It should be noted, however, that the Illinois manufacturing sector is not as dominant as it was in February 1999, the last time our State’s unemployment rate was 4.1%.  Illinois’ overall job universe has adjusted over the past two decades.  In line with overall worldwide trends towards automation, many Illinois jobs have moved from factories to offices and service-related employment opportunities.

Illinois’ September 2018 unemployment is slightly higher (0.4%) than the 3.7% national unemployment rate for the same month.  The nationwide trend is towards the 4.0% level that economists refer to as “full employment.”  

ECONOMIC GROWTH

·        Illinois Innovation Network expands to DeKalb County.  Northern Illinois University (NIU), already home to many centers of graduate education and research, has announced plans for a $23 million business-development incubator and innovation center.  NIU will construct the center to serve as a hub of the Illinois Innovation Network, the growing web of broadband-linked innovation centers being set up in locations throughout the state.  Much of the center’s construction cost will be funded by NIU, by gifts made to NIU, and by private investments made by venture capitalists. 

Looking towards new opportunities for economic growth, the General Assembly took steps to provide $500 million in Innovation Network startup seed money as part of the FY19 budget.  Creation of the Illinois Innovation Network, which is being governed as an affiliated partner of the University of Illinois, followed a series of studies by experts on the importance of face-to-face interactions as an essential element in the fostering of technological innovations and job creation.  California’s Silicon Valley is a classic example.  The Innovation Network plans to utilize modern fiber optics to enable a wide variety of contact opportunities, including high-speed video conferencing and terabyte data-transfer, between Innovation Network hubs.  The Innovation Network will encourage its affiliated professionals to concentrate on issues of food systems, water resources, and environmental change.  The Innovation Network has already announced decisions to place hubs in Chicago and in Springfield.   The NIU/DeKalb hub announcement was made on Tuesday, October 9.

BUDGET

·        CGFA releases State revenue numbers for September 2018.  The Commission on Budget Forecasting and Accountability (CGFA) is the nonpartisan budget-forecasting arm of the Illinois General Assembly.  Working with the Department of Revenue and other State revenue collectors, this office monitors the State’s cash flow and determines its balance with the State’s spending patterns and budgeted expenditures.   CGFA’s report on state revenues in September 2018 was published on Tuesday, October 2.     

In September 2018, Illinois continued to enjoy healthy revenue numbers, driven by almost 6.1 million non-farm payroll jobs maintained by Illinois employers in FY18.  Weekly employee paycheck earnings, on which state income taxes are paid, rose by 2.3% over the course of FY18.   September 2018 State personal income tax payments totaled more than $1.8 billion, up $218 million from September 2017.  This jump in September personal income tax receipts made up well more than half of the overall $240 million increase in general funds tax receipts and transfers-in during September 2018 as opposed to September 2017.

Corporate and sales tax receipts also increased significantly.  Other key revenue sources, led by cigarette taxes, liquor taxes, Lottery revenues, and riverboat receipts taxes, were flat-to-down, and there was a sharp drop in overall Federal aid for the month as compared to the year-earlier period.  September 2017 had seen a temporary spike in federal Medicaid reimbursements to Illinois, a cash-flow number that could not be replicated in September 2018.