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ILLINOIS ONE OF FEW
STATES STILL RECOVERING FROM THE GREAT RECESSION
Illinois Policy Institute
Most states
have far outstripped Illinois on the number of jobs recovered. And even
worse, Illinois has also lagged in the quality of jobs recovered.
Illinois was the 37th state to recover and match its pre-recession jobs
count. But there are still 110,000 fewer Illinoisans working today than
before the recession began.
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 Illinois is one of a handful of states that is still struggling to put people
back to work after the Great Recession. Just consider: Though Illinois now has
39,000 more private-sector payrolls jobs now than it had before the Great
Recession began, there are 110,000 fewer Illinoisans working than before the
recession began.
Illinois’ recovery has been tripped up by anti-jobs regulations, staggering debt
problems and painful tax hikes. While surrounding states have attracted new
investments and jobs growth, hard-working families in Illinois have been left
behind because the state simply hasn’t put its house in order. This has resulted
in weak growth and a struggling jobs recovery likely driven by part-time work.
Illinois lost 412,000 private sector jobs during the two years of jobs losses
from the Great Recession, according to the Bureau of Labor Statistics, or BLS,
business establishment survey. It took five and a half years for Illinois to
recover that jobs count, and by July 2015 Illinois had the same number of
private sector jobs as before the recession began. However, labor market data
indicate that Illinois is likely still lagging in recovering high-quality,
full-time jobs, and a significant part of the jobs recovery has been driven by
part-time work.
Illinois was the 37th state to recover and match its pre-recession jobs count.
The most recent month of jobs data from May 2016 shows that Illinois now has
39,000 more private-sector payroll jobs than it had before the recession began.
Most states have far outstripped Illinois on the number of jobs recovered. And
even worse, Illinois has also lagged in the quality of jobs recovered. The BLS
data include a second survey, which provides a count of the number of people
working in each state instead of the number of jobs. This second survey, known
as the household survey, shows that Illinois still has 111,000 fewer people
working today compared to before the recession began, leaving Illinois a long
way from recovery.
What does this mean? The BLS business survey says Illinois has more jobs than
before the recession, but the BLS household survey says Illinois has fewer
people working over the same timeline. It’s likely explained by the fact that
Illinois’ jobs recovery has been driven by lower-paying part-time jobs rather
than higher-quality, full-time jobs. When a person gains two part-time jobs
instead of one full-time job, the jobs count advances more quickly than the
count of people working.
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 And that’s exactly how Illinois’ recovery looks. The jobs count
has bounced back significantly faster than the count of people
working. The recovery gap between the number of jobs and the number
of people working in Illinois likely points to a recovery marked by
fewer workers but more part-time jobs.
When it comes to putting people back to work after the recession,
Illinois is one of the worst states in the country. There are still
110,000 fewer Illinoisans working compared to before the Great
Recession, putting Illinois in the company of only Ohio and Michigan
for worst recovery over the recession timeline. However, Ohio and
Michigan each experienced the collapse of the auto industry, and
hemorrhaged jobs losses for about a year longer than Illinois did.
Furthermore, they both made a much stronger recovery once they hit
bottom.
The same factors that have held back Illinois’ recovery are still
smothering good work opportunities and driving jobs to other states.
Numerous regulations, high taxes and the prospect of even more tax
hikes to pay for Illinois’ tremendous debts are suppressing economic
growth and causing companies to ignore Illinois when they decide
where to invest.
Three areas of reform need to be addressed to reinvigorate Illinois,
and attract good jobs to the state’s economy. Those areas are:
- Spending reforms to reduce the cost of government and
taxation
- Tax reforms to encourage economic growth in the tax code
- Regulatory reforms to cut the red tape for job creation
Illinois political leaders bought themselves six months with a
partial spending stopgap deal. In the meantime, they should dedicate
their efforts to making pro-growth reforms in these three critical
areas.
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