I L L INO I S E C O NOM IC
R E V I EW
The Monthly Illinois Economic Review contains information on national, statewide, and local economic
performance by measuring job growth, unemployment, and business activity. This information is compiled by
IGPA Economist Geoffrey Hewings, director of the Regional Economics Applications Laboratory at the
University of Illinois at Urbana-Champaign with assistance from Yizhou Zhang and Kijin Kim.
SEPTEMBER 2015
EMPLOYMENT
E MP LOY ME N T DA TA S UM M A RY








Illinois lost 900 jobs in August 2015, compared with an 800 job loss in July 2015. Compared to
August 2014, Illinois has added 41,200 jobs. The three-month moving average, a more stable
measure of labor market, showed a decrease of 2,400 jobs per month.
The Nation added 173,000 jobs at a rate of 0.12%, compared with a 245,000 job gain in July 2015.
The three-month moving average was up by 221,000 jobs per month.
The RMW gained 29,800 jobs in August after a 56,400 job gain in July 2015. The three-month moving
average was up by 25,000 jobs per month.
Since the beginning of the recession in December 2007, Illinois has posted positive job gains 49
times and negative job changes 42 times. The state of Illinois now has a net loss of 67,500 jobs since
the beginning of the recession in December 2007.
Since January 2010, when Illinois employment growth resumed after the national recession, Illinois
has added 335,500 new jobs.
By August 2015 in Illinois, Professional & business services and Leisure & hospitality have both
recovered to their previous employment peak levels. The 12-month-ahead job recovery forecasts
show that the future recovery rates in Illinois will increase for every sector except Manufacturing,
Information and Other Services.
The shadow unemployment rates for Illinois, RMW and the Nation were 10.67%, 11.47% and
10.92%, compared to official unemployment rates of 5.6%, 4.8% and 5.1%.
Through August 2015, the cumulative job growth for Illinois, RMW and the Nation compared to
January 1990 stood at 12.38%, 16.99%, and 30.37%, respectively.
AUGUST 2015
E MP L OY ME N T C HA RT
September
Total NonFarm
Employment
Growth
Rate %
2015
Nation
0.12
173,000
2.09
2,919,000
10.92%
Negative
RMW*
0.15
29,800
1.68
330,000
11.47%
Illinois
-0.02
-900
0.7
41,200
10.67%
July 2015– August 2015
Number of
Jobs
Last 12 months
Growth
Rate %
Number
of Jobs
Aug 2015
Shadow
U.R. **
*RMW stands for Rest of the Midwest including six states, Indiana, Iowa, Michigan, Missouri, Ohio and Wisconsin.
**REAL has estimated a shadow unemployment rate; this is calculated as the unemployment rate that would be observed if labor force participation rates
matched the average for the 15-year period from 1990 to 2004.
2
T OTA L N O N - FA R M E M P L OY M E N T G ROW T H R A T E J A N 1990 – A U G U S T 2015
135.00
130.00
125.00
120.00
115.00
110.00
105.00
100.00
National
RMW
IL
95.00
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
L A S T 1 2 M O N T HS TOTA L NO N - FA R M E M P L OY M E NT GROW T H R AT E S S E P 2 0 1 4 – AU G
2015
Sep/14
Oct/14
Nov/14
Dec/14
Jan/15
Feb/15
Mar/15
Apr/15
May/15
Jun/15
Jul/15
0.35%
0.30%
0.25%
0.20%
0.15%
0.10%
0.05%
0.00%
-0.05%
-0.10%
Nation
RMW
IL
-0.15%
3
Aug/15
Total Non-farm Employment growth rate by Sector July 2015 – August 2015
20 Construction
30 Manufacturing
40 Trade, transportation & utilities
50 Information
55 Financial activities
60 Professional & business services
65 Education & health
70 Leisure & hospitality
80 Other Services
90 Government
-1.00%
-0.80%
-0.60%
-0.40%
-0.20%
0.00%
0.20%
Nation
S HA D OW
0.40%
0.60%
RMW
0.80%
1.00%
IL
UN E MP LOY ME N T
Unemployment Rate: Official and Shadow
The unemployment rate estimates the percentage of workers in the labor force who are currently unemployed
but who are seeking work. The labor force participation rate is the percentage of the population 16 and older
who are either working or actively seeking work. The participation rate has declined since the 1990s and thus
a number of analysts feel that the official unemployment rate does not account for a larger number of people
who have dropped out of the labor force. REAL has estimated a shadow unemployment rate; this is calculated
as the unemployment rate that would be observed if labor force participation rates matched the average for
the 15-year period from 1990 to 2004.






In the 1990s, the average participation rate was 68.2% in Illinois whereas in 2010, it has been only
66.6%.
For the 15 years from 1990 to 2004, the average participation rate was 68.1% in Illinois.
In the 1990s in the US, the average participation rate was 65.5% whereas in 2010, it has been 66.0%;
for the 15 years from 1990 to 2004, the average participation rate was 66.6%.
The figures on the next page show the difference between the official and shadow unemployment
rate for Illinois (top figure) and the US as a whole (bottom figure).
After 2000, the gap between Illinois’s official and shadow unemployment rates increased until 2006
when it began to shrink. However, the gap went increasing again since 2010.
To bring the two together a further 107,000 jobs would need to be created in Illinois.
4
Illinois

14%
Unemployment Rate
12%
Shadow Unemployment Rate
10%
8%
6%
4%
2%
0%
US

14%
Unemployment Rate
Shadow Unemployment Rate
12%
10%
8%
6%
4%
2%
0%
5
E MPLOYMENT F ORECAST
Illinois
Total non-farm
Construction
Manufacturing
Trade, transportation & utilities
Information
Financial Activities
Professional & business services
Education & health
Leisure & hospitality
Other services
Government
Number of Jobs
(in thousands)
6200
August
2015
5,920,400
209,600
571,200
1,188,400
August
2016 (p)
5,925,300
214,900
555,600
1,191,000
4,900~14,700
5,300
-15,600
2,600
Growth Rate
%
0.08%~0.25%
2.53%
-2.73%
0.22%
97,500
95,400
-2,100
-2.15%
371,500
933,300
898,700
562,200
251,300
827,500
377,100
933,400
912,800
569,100
250,800
825,000
5,600
100
14,100
6,900
-500
-2,500
1.51%
0.01%
1.57%
1.23%
-0.20%
-0.30%
Number of Jobs
Total Non-farm Employment Forecast
6000
5800
5600
5400
5200
5000
4800
4600
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Year
* The values by sector for the number of jobs added are the lower bound of the forecast.
6
Employment Forecast for MSAs
Growth
Sector with
Highest
Growth
Rate
(p)
Sector with
Lowest
Growth
Rate (p)
0.43%~ 0.72%
+
GOV (3.20%)
INF (-12.10%)
-100~0
-0.13%~0.00%
-
EDU (1.92%)
MAN (-2.35%)
4,093,200
53,200~63,300
1.32%~1.57%
+
CON (4.80%)
MAN (-0.97%)
180,500
178,100
-2,400~ -1,400
-1.32%~ -0.80%
-
CON (1.58%)
EDU (-6.48%)
50,600
49,900
-600~-500
-1.28%~-1.02%
-
PRO (5.31%)
INF (-5.95%)
Kankakee
44,800
44,700
-100~100
-0.10%~ 0.24%
-
EDU (3.42%)
INF (-7.43%)
Peoria
176,800
177,700
800~1,300
0.46%~ 0.71%
+
GOV (2.65%)
PRO (-5.26%)
Rockford
151,200
150,900
-300~-10
-0.20%~-0.01%
-
EDU (1.73%)
INF (-5.70%)
Springfield
111,800
112,000
200~400
0.15%~ 0.35%
+
EDU (2.69%)
MAN (-4.08%)
July 2015*
July
2016
(p)*
Number of
Jobs *
Growth Rate
%
Bloomington-Normal
95,100
95,600
400 ~ 700
Champaign-UrbanaRantoul
108,700
108,500
Chicago
4,040,100
MSAs
Davenport-Rock
Island-Moline
Decatur
*Total Non-Farm Jobs
Number of Jobs
(in thousands)
105000
Total Non-farm Employment Forecast
Bloomington (BN)
Number of Jobs
(in thousands)
120000
Total Non-farm Employment Forecast
Champaign-Urbana-Rantoul (CU)
100000
115000
95000
110000
90000
105000
85000
80000
100000
75000
95000
70000
90000
65000
60000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
85000
2016
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2010
2012
2014
2016
Year
Number of Jobs
(in thousands)
4200000
Number of Jobs
(in thousands)
195000
Total Non-farm Employment Forecast
Chicago (CHI)
4100000
Year
Total Non-farm Employment Forecast
Davenport-Rock-Island-Moline (DRM)
190000
4000000
185000
3900000
180000
3800000
3700000
175000
3600000
170000
3500000
165000
3400000
160000
3300000
155000
3200000
3100000
150000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
Year
Year
7
Number of Jobs
(in thousands)
200000
Number of Jobs
(in thousands)
170000
Total Non-farm Employment Forecast
Peoria (PE)
Total Non-farm Employment Forecast
Rockford (RO)
165000
190000
160000
180000
155000
170000
150000
145000
160000
140000
150000
135000
140000
130000
130000
125000
120000
120000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
1990
2016
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
Year
Year
Number of Jobs
(in thousands)
62000
Number of Jobs
(in thousands)
50000
Total Non-farm Employment Forecast
Decatur (DE)
60000
48000
58000
46000
Total Non-farm Employment Forecast
Kankakee (KA)
44000
56000
42000
54000
40000
52000
38000
50000
36000
48000
34000
46000
32000
44000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
30000
2016
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
Year
Number of Jobs
(in thousands)
120000
Year
Total Non-farm Employment Forecast
Springfield (SP)
118000
116000
114000
112000
110000
108000
106000
104000
102000
100000
98000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2016
Year
8
Barometer of Job Recovery
Illinois Recovery Scenarios
Growth Rate
To Recover
At the point of
2015- August
At the point of
2010-June
In 5 years
48,700 jobs/year
110,300 jobs/year
In 8 years
30,500 jobs/year
69,000 jobs/year
In 10 years
24,400 jobs/year
55,200 jobs/year
In 15 years
16,200 jobs/year
36,800 jobs/year
* The figure 579,100 is the number of jobs needed for the Illinois economy to recover to the previous employment
peak, Nov-2000. The gap between the previous peak, Nov-2000 and the previous lowest point, Dec-2009 is
472,100. Adding 107,000, the number of jobs that needed to bring the shadow and official unemployment rates
together, the total number of jobs that Illinois needs to create is 579,100.
**The figure 27,500 represents the jobs recovered from December 2009 (previous lowest level) through June 2010.
*** The figure 335,500 represents the jobs recovered from December 2009 through August 2015.
9
I LLINOIS J OB R ECOVERY BY S ECTOR
Illinois job recovery by sector from Dec 2007 – August 2015
Job Changes in
Recession Period*
Job Changes in
Jan 2010-Aug
2015
Recovery Rate
Forecasted Job
Changes Jan
2010-August
2016
Forecasted
Recovery Rate
Construction
-63,800
5,700
8.93%
11,000
17.24%
Manufacturing
-114,600
16,400
14.31%
700
0.61%
Trade, transportation & utilities (TTU)
-97,700
68,100
69.70%
70,100
71.75%
Information
-11,300
-6,900
-61.06%
-9,000
-79.65%
Financial activities
-33,000
6,800
20.61%
12,100
36.67%
Professional & business services
-92,200
151,900
164.75%
152,000
164.86%
Education & health
32,600
76,800
-
90,900
-
Leisure & hospitality
-22,300
50,300
225.56%
57,200
256.50%
Other Services
-5,900
-4,700
-79.66%
-5,200
-88.14%
Government
*Recession period: Dec 2007- Dec 2009
6,000
-29,200
-
-31,300
-


Recovery by
Sector



During the recession period of December 2007-December 2009, 8 out of
10 Illinois sectors experienced negative job growth. Education & health
and Government were the only 2 sectors that had positive job growth
during the recession.
Since January 2010, Illinois employment growth resumed. Construction,
Manufacturing, Trade, transportation & utilities, Financial activities,
Professional & business services and Leisure & hospitality have
recovered 8.93%, 14.31%, 69.70%, 20.61%, 164.75% and 225.56%
respectively, from the jobs lost during the recession.
By August 2015, Professional & business services and Leisure &
hospitality had both recovered to their previous employment peak levels.
However, recovery rates for sectors such as Information and Other
Services are still negative, namely -61.06% and -79.66% respectively.
The 12-month-ahead job recovery forecasts show that the future
recovery rates in Illinois will increase for every sector except
Manufacturing, Information and Other Services.
10
C ATCH UP S CENARIO
Catch-up Scenario* of Previous Peak Job Index in Illinois
Nation
RMW
IL
Previous Peak
Current
Catch-up
126.49
(Dec-2007)
119.39
(Jun-2000)
115.00
(Nov-2000)
130.37
(August 2015)
116.99
(August 2015)
112.38
(August 2015)
Positive
growth
Positive
growth
Positive
growth
Recovery rates at
August 2015**
20.07%
40.25 %
26.19%
Metro Areas***:
Bloomington
Normal
ChampaignUrbana
Chicago
Davenport- Rock
Island-Moline
Decatur
Kankakee
Peoria
Rockford
Springfield
Metro-East
142.06
(Feb 2002)
116.26
(Jan 2009)
114.82
(Nov 2000)
115.06
(Mar 2008)
112.38
(Jan 2000)
125.66
(Nov 2011)
122.09
(Aug 2008)
122.81
(Nov 2000)
110.94
(Aug 2000)
114.97
(Jun 2001)
133.45
(July 2015)
110.23
(July 2015)
113.15
(July 2015)
109.06
(July 2015)
94.04
(July 2015)
124.76
(July 2015)
114.02
(July 2015)
112.17
(July 2015)
105.82
(July 2015)
105.92
(July 2015)
Negative
growth
Negative
growth
Positive
growth
Positive
growth
Negative
growth
Positive
Growth
Positive
growth
Positive
growth
Positive
growth
Negative
growth
NA
NA
108.47 %
24.13%
NA
101.66%
20.85%
44.60%
129.16%
NA
* Catch-up scenarios are based on average monthly growth rate over the previous 12 months. Nation already passed its previous peak in February
2005.
**Recovery rates are percentage of jobs added since the last official end of the recession. We have also adjusted for differences in population and
labor participation rates i.e shadow unemployment between the data month and December 2007.
*** Due to lag of data release schedule there is one month of time lag in the catch-up scenario for metro areas.
NOTE: The US Bureau of Labor Statistics and the Illinois Department of Employment Security changed the way national and state employment
data are coordinated to be more consistent. As a result, there have been some significant changes in estimates for Illinois over the past year.
11
CBAI INCREASED IN JULY
This index is based on national indices of leading indicators and is a barometer for the economy, tracing the
path of growth or contraction through to the current period and then forecasts up to 24 months into the
future.

The Chicago Business Activity Index (CBAI) increased to 98.2 in July from 97.4 in June. The rise is
attributed to the job growth in the manufacturing, nonmanufacturing and construction sectors in the Chicago
area.

In July, the national and regional economies shared positive features. The Federal Reserve Board
announced that the industrial production index increased 0.9 percent in July after having little changed in
June.
Capacity utilization for the industrial sector rose 0.6 percentage point in July to 78 percent. The Chicago
Fed reported that the Chicago Fed National Activity Index (CFNAI) rose to +0.34 in July from -0.07 in June,
led by a rise in the production, consumption and housing-related indicators. In the Chicago region,
employment in the manufacturing and nonmanufacturing sectors rose 0.15 percent and 0.18 percent,
respectively, in July. Employment in the construction sector increased 0.09 percent in July. Retail sales are
estimated to have declined 0.57 percent.


In the coming months, the national economy is likely to stay on the expansion phase. The economic growth
reflected in the CFNAI-MA3 suggests that growth in national economic activity edged up to a neutral
reading. The Bureau of Labor Statistics reported that total nonfarm payroll employment rose by 173,000
and the unemployment rate edged down to 5.1 percent in August. Considering recent national economic
conditions and movements of projected CBAI, the Chicago economy is expected to continue its recovery
trend over the next several months.
Chicago Business Activity Index
CBAI (Current: 98.2)
1 month 3 month 1 year
Historical (ago)
97.4
90.7
102.1
Forecast (ahead)
94.6
99.0
-
12
METROPOLITAN STATISTICAL
AREA LEAGUE TABLES
MSA LEAGUE TABLES SUMMARY*

Metro-East (1st to 6th) experienced the deepest fall in July 2015.

Bloomington-Normal (2nd to 5th) and Springfield (6th to 7th) also dropped in terms of rank
from last month.

The most remarkable upward moves in July were recorded for Decatur (4th to 1st) and Chicago
(7th to 4th).

In the 12-month growth league table, upward moves were recorded for Champaign-UrbanaRantoul (3rd to 1st), Rockford (4th to 3rd), Kankakee (5th to 4th), Decatur (9th to 8th) and
Peoria (10th to 9th).

Downward moves were recorded for Metro-East (1st to 5th) and Davenport-Rock IslandMoline (8th to 10th).

In the 12 months growth league table, Davenport-Rock Island-Moline dropped to the last place
and Champaign-Urbana-Rantoul climbed to the first place.
*NOTE: The US Bureau of Labor Statistics and the Illinois Department of Employment Security changed the way national and state
employment data are coordinated to be more consistent. As a result, there have been some significant changes in estimates for
Illinois over the past year.
13
MSA League Tables*: Non-farm Employment Growth Rate
Monthly growth:
Rank
June 2015
July 2015
Rank
Change**
1
Metro-East(1.43%)
Decatur(0.42%)
1
(+3)
2
Bloomington-Normal(1%)
Champaign-Urbana-Rantoul(0.22%)
2
(+1)
3
Champaign-Urbana-Rantoul(0.41%)
Peoria(0.22%)
3
(+2)
4
Decatur(0.18%)
Chicago(0.19%)
4
(+3)
5
Peoria(0.15%)
Bloomington-Normal(0.16%)
5
(-3)
6
Springfield (0.15%)
Metro-East(-0.11%)
6
(-5)
7
Chicago(0.11%)
Springfield (-0.2%)
7
(-1)
8
Rockford (-0.05%)
Rockford (-0.22%)
8
(+0)
9
Davenport-Rock Island-Moline(-0.46%)
Davenport-Rock Island-Moline(-0.51%)
9
10
Kankakee(-0.96%)
Kankakee(-0.98%)
10
(+0)
(+0)
Growth over last 12-months:
Rank
June 2015
July 2015
Rank
Change**
1
Metro-East (1.86%)
Champaign-Urbana-Rantoul (1.98%)
1
(+2)
2
Chicago (1.29%)
Chicago (1.46%)
2
(+0)
3
Champaign-Urbana-Rantoul (1.03%)
Rockford (0.82%)
3
(+1)
4
Rockford (0.98%)
Kankakee (0.75%)
4
(+1)
5
Kankakee (0.96%)
Metro-East (0.59%)
5
 (-4)
6
Bloomington-Normal (0.54%)
Bloomington-Normal (0.52%)
6
(+0)
7
Springfield (-0.17%)
Springfield (0.01%)
7
(+0)
8
Davenport-Rock Island-Moline (-0.85%)
Decatur (-0.77%)
8
(+1)
9
Decatur (-0.97%)
Peoria (-1.06%)
9
(+1)
10
Peoria (-1.35%)
Davenport-Rock Island-Moline (-1.93%)
10
 (-2)
MSA League Tables are based on revised employment data. For instances of equal growth rate for multiple MSAs ranks
are decided based on change of growth rate from previous month.
*
14
Unemployment Claims (Initial)
Unemployment Claims
(Initial, IL)
Unemployment Claims
(Initial, US)
40,000
1,200,000
Initial Claims (IL)
Initial Claims (US)
35,000
1,000,000
30,000
800,000
25,000
`
600,000
20,000
400,000
15,000
200,000
Jan/15
Jan/14
Jan/13
Jan/12
Jan/11
Jan/10
Jan/09
Jan/08
Jan/07
Jan/06
Jan/05
Jan/04
Jan/03
Jan/02
Jan/01
5,000
Jan/00
10,000
0
15