Flash index points to growth in state economy
CHAMPAIGN — The University of Illinois flash index finished the year strong, rising in December and signaling further growth in the Illinois economy.
The index rose to 107, up from 106.5 in November, according to the University of Illinois' Institute of Government and Public Affairs.
The flash index — a weighted average of growth rates in corporate earnings, consumer spending and personal income — climbed through the spring, then leveled off, declining slightly in October and November.
The 107 reading tied September for the highest reading of 2013. The last time the index was higher was April 2007, when it stood at 107.4.
J. Fred Giertz, the economist who compiles the index for the institute, called the December rise "welcome news."
"The year ended with strong results that have engendered considerable optimism for 2014," Giertz said in a release from the institute.
"There is hope that the economy may finally break out of the painfully slow recovery mode and move into a higher gear," he said.
All three components of the index — individual income tax receipts, corporate tax receipts and sales tax receipts — were up from December 2012, when adjusted for inflation.
Both individual and corporate income tax receipts were up by more than 10 percent, while sales tax receipts were up by 4 percent, reflecting a "reasonably good" holiday season, Giertz said.
The strong performance of the Illinois economy in December mirrors recent developments in the national economy.
The nation's gross domestic product grew by 4.1 percent in the third quarter of 2013 — only the second quarter in the past eight years in which growth exceeded 4 percent.
Unemployment remains a problem, with the national rate at 7 percent and the Illinois rate at 8.7 percent. Giertz said those rates are high when compared with pre-recession levels.
Each month, Giertz takes tax receipt totals from corporate income, personal income and retail sales and adjusts them for inflation before calculating growth rates. Growth rates are figured for the preceding 12 months.