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David Yaskewich, professor of economics and chair of accounting,
economics and finance at Southeast Missouri State University in
Cape Girardeau, said income tax and sales taxes are the primary
generators of revenue at the state level.
“If we have a healthy labor market where people are working,
that would be something that would tend to generate revenue. So
in a low unemployment period, if a state were having
difficulties with its budget, that would be potentially
worrisome, because if unemployment were to rise, it could only
really get worse from that standpoint,” Yaskewich told The
Center Square.
The Illinois state budget is $55.9 billion for fiscal year 2027,
up from $39 billion in 2019.
The Illinois Flash Index increased from 101.5 in September to
101.7 in October, reflecting continued strength in state
revenues and an improving labor market.
Yaskewich said it was taken as good news that the U.S. added
165,000 jobs in October, even though real wages have not kept up
with inflation.
“That really could suggest consumers might be somewhat cautious
about spending during the holiday season if that's the case,”
Yaskewich said.
Yaskewich said inflation is at the top of the radar for the
Federal Reserve.
“Both the jobs numbers and the inflation numbers from the past
week are likely going to suggest that a quarter point interest
rate hike at their next meeting in December is probably going to
happen. It's probably all but certain at this point,” Yaskewich
said.
Yaskewich said he would recommend that policy makers think long
term when it comes to employment and revenue numbers.
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