Illinois unemployment 4th worst in U.S., job growth slows in May
While government jobs outpaced the overall growth for the month, manufacturing and construction took the biggest losses as the unemployment rate remains among the worst in the nation.
The job gains were spread over most of the state’s sectors, but several saw significant losses. Construction and manufacturing suffered the most significant losses for the month, with construction losing 2,400 jobs and manufacturing losing 1,700. The information sector lost another 800 jobs and the mining sector lost 100 jobs.
Government added the most jobs, with 2,600 jobs in May. Financial activities increased by 1,900 jobs; leisure and hospitality increased by 1,400 jobs; education and health added 1,200 jobs; trade, transportation and utilities added 300 jobs while professional and business services added 100 jobs.
The other services sector remained unchanged for May.
Despite another month of modest job growth helping lower Illinois’ unemployment rate, the state is still struggling compared to most other states. At 4.1%, Illinois’ May unemployment rate was tied for the fourth-worst rate in the nation. Only Nevada, California, and Delaware had worse unemployment rates in May. This news comes on the heels of the national unemployment rate increasing by 0.3% in May to 3.7% despite the economy adding 339,000 jobs for the month.
Illinois’ sluggish recovery from the pandemic has been further complicated by the troubling trend of population loss continuing to hit communities all over the state. Data from the U.S. Census Bureau shows 85% of Illinois communities lost population last year impacting nearly every metro area in the state. Data from the Internal Revenue Service revealed Illinois lost more than 105,000 residents last year. Those residents took with them nearly $11 billion in wealth.
The bad news hasn’t stopped there. New data from the Internal Revenue Service reveals Illinoisans of every age group and income bracket are moving out of the state. The majority of those leaving the state are prime working-age adults with incomes of $100,000 or more. The IRS data contradicts the idea Illinois’ migration problems were solely because of high school graduates going out of state to attend college.
Worse, the IRS data likely underestimates Illinois’ losses, because 32 million households (18%) nationwide don’t file federal tax returns. Changes in filing activity can prevent matching up tax returns year-to-year.
Despite more and more data confirming Illinois has a serious exodus, Gov. J.B. Pritzker and other Illinois politicians continue to deny there is a problem. In addition to tangible evidence of Illinois’ outmigration crisis from the IRS, new surveys of Illinoisans show 51% would leave the state if given the opportunity. The main reason Illinoisans want to leave the state: high taxes.
Unfortunately, Illinoisans will be seeing the return of the grocery tax on July 1 after an election year hiatus issued by Gov. J.B. Pritzker. Also hitting pocketbooks July 1 is a second gas tax increase, also a product of Pritzker’s election-year gimmick to claim he lowered costs for Illinoisans struggling with a slowly growing economy and high inflation.
Without significant reforms to taxes, pensions and business regulations, the state’s economy is likely to continue lagging. Failing to change means state leaders are willing to accept the flow of workers to other states.