Report: Illinoisans experiencing second-worst income growth in the nation
ILLINOIS NEWS NETWORK
Since 2007, the average Illinoisan hasn’t even seen a full percentage point of personal income growth.
A study released last week by Pew Charitable Trusts shows that, since 2007, the average rate of personal income growth for all Illinois residents is .9 percent. That’s worst in the Midwest and second only to Nevada nationally.
Pew Analyst Barb Rosewicz said the main drivers for such slow growth have been a significant loss of high-paying manufacturing jobs and farmers’ ever-thinning profit margins.
“Illinois’ farm earnings are less than half of what they were before the recession started,” she said. “And earnings from manufacturing are down nearly 10 percent in Illinois compared to where they were before the recession.”
Source: Pew Charitable Trust
Another issue she said accounts for low income growth is people leaving the state who can afford to, thus lowering the average.
“Illinois had the seventh-slowest population growth of all states between 2007 and 2015. This is one of the long-term trends that factor into the direction of a state’s economy,” Rosewicz said.
Illinois lost 115,000 people, on net, over 12 months ending last summer.
In terms of state fiscal health, Illinois is one of three states that would have less than a week of reserves set aside for budget shortfalls, largely because of the lack of a balanced budget.
Rosewicz said one of the largest long-term challenges for Illinois is its staggering amount of unfunded pension liabilities. She said the percentage of state income will likely continue to get eaten up by the need to produce more contributions, making a rainy-day fund unlikely.
The report is based on personal income, which considers residents’ paychecks; Social Security benefits; employers’ contributions to retirement plans and health insurance; income from rent and other property; and income from programs like Medicare and Medicaid.