Senator: Illinois not ready for economic slowdown

Senator: Illinois not ready for economic slowdown

ILLINOIS (IRN) — The bipartisan Illinois Commission on Government Forecasting and Accountability expects the state to bring in less money than what the governor’s office has projected, but both anticipate an economic slowdown in the future.

 

For the coming fiscal year that begins July 1, the commission estimated the state will collect about $38.1 billion in revenue, that’s $700 million less than what the governor’s office forecasted. COGFA Revenue Manager Jim Muschinski said the commission’s estimate is based on existing law and didn’t include possible revenue from recreational marijuana or sports gambling.

 

Muschinski said the commission agreed with the Pritzker administration that the larger economy could slow in the coming years

 

“Longer term, perhaps into 2020, late 2020 into ‘21, that may be a concern if a consensus of a global slowdown comes to fruition,” Muschinski said.

 

The Pritzker administration last week also said there could be a slowdown the year after next, putting additional pressure on the state’s finances.

 

Commission member state Sen. Heather Steans, D-Chicago, said it will be important for the state to brace for a slowdown in economic activity, which could affect how tax money flows into state coffers.

 

“Illinois is not in a good position for that,” Steans said. “We need to make sure we get ourselves into a good position for that.”

 

Steans said whether there’s the political will to curb spending to build a rainy day fund in case there’s a slowdown will have to wait and see.

 

“Right now is about as good as it gets and it’s likely to somewhat moderate over the forecast period,” Muschinski said.

 

With that forecast, state Rep. C.D. Davidsmeyer, R-Jacksonville, said lawmakers need to promote growth policies.

 

“Probably over the last four, five, or six years we’ve actually wasted away some of the best years that the nation has had,” Davidsmeyer said. “So we have to be prepared to push things that allow us to beat the national trend and go above and beyond and not continue to lag the national trend and lag the midwest.”

 

Republicans and the business community have been calling for various reforms to lower the cost of workers’ compensation or reduce Illinois’ property taxes much success.

 

The commission also reported that earnings are up in Illinois since the Great Recession, but there are fewer of some types of higher-paying jobs. The commission’s report said jobs and wages in Illinois are up 3.7 percent from a decade ago, but job numbers in construction and information technology are down as much as 18 percent.

 

There has been an increase in those jobs in recent years, despite being down overall for the decade, Muschinski said. Davidsmeyer said lawmakers need to promote policies that would help bring more higher-paying jobs to the state.

 

“We’re seeing that shift into the service sector side as opposed to manufacturing,” Davidsmeyer said. “But those manufacturing and construction jobs are coming back … we need to keep hopefully passing positive legislation to push us in that direction to do a little bit more.”

 

The average weekly wage in Illinois is $946, compared to $912 a decade ago.