Illinois sees nation’s largest drop in job openings as recession fears grow
Illinois’ job opening rate declined 1.5 percentage points in May. That’s not a good way to enter a potential recession.
There were 102,000 fewer job openings for Illinoisans in May compared to April, according to new data from the U.S. Bureau of Labor Statistics. The decline dropped Illinois’ job opening rate by 1.5 percentage points, the most of any state in the nation.
Illinois’ neighboring states also experienced a drop in job opening rates, but to a much lesser extent. Nationally, the job opening rate declined by a modest 0.3 of a percentage point.
Illinois’ declining job opening rate wasn’t because of a large increase in the number of Illinoisans finding a job, either. The state only added 13,400 jobs in May, while openings decreased by 102,000 in the same month. That foreshadows what could be a large slowdown in business activity. The data comes after major companies announced layoffs and hiring freezes.
A decline in job openings has stoked fear the U.S. economy is slowing, with many experts concerned the nation is on the brink of – or may already be in – a recession. If this is the case, Illinoisans could be in for a particularly tough downturn, as job openings are falling most rapidly here and the state is already battling the highest unemployment rate in the Midwest.
The Federal Reserve recently announced plans to hike interest rates for the fourth time this year in an effort to combat rampant inflation. Despite rising interest rates, inflation has continued to remain higher than expected – up 9.1% from a year ago. The national economy shrank by 0.9% during the second quarter of 2022, according to preliminary data released July 28 by the U.S. Bureau of Economic Analysis. That is traditionally a key indicator of a recession. The combination of these factors is bad for future economic prospects. The U.S. labor market might not be able to sustain its recovery because of these challenges.
However, Illinois could still be more susceptible to a potential economic downturn as businesses and residents flee. Three major corporations – Boeing, Caterpillar and Citadel – all announced in the past two months they would be relocating company headquarters out of Illinois. And a record exodus driving population decline threatens to prevent the state’s economy from ever returning to pre-pandemic employment levels.
The first step to ensure Illinoisans don’t endure a particularly painful future economic downturn will be for voters to take a hard look at Amendment 1 on the Nov. 8 ballot. Amendment 1 would change the Illinois Constitution to grant unions in Illinois more extreme powers than they have in any other state, including the ability to bargain over virtually limitless subjects, the ability to override state law through their contracts and a guarantee taxpayers and lawmakers would have an extremely difficult time reversing course.
Should Amendment 1 pass, Illinois’ $313 billion pension debt would continue to balloon as state and local taxes, which are already among the highest in the nation, rise in an attempt to keep up. Spending on vital programs would continue to fall. Illinois’ housing and labor markets are already suffering as high taxes and reduced services make finding a job and living in the state tenuous. These problems would be exacerbated should the U.S. enter a prolonged recession.
Illinois needs reform that will control the state’s cost drivers and deliver vital support to taxpayers when they need them the most. Amendment 1 ensures those challenges worsen during periods of economic duress.