Illinois Faces Historic Economic Challenges
The Illinois economy, like the national economy, is in a deep recession.
Employment
The Illinois unemployment rate surged to 7.9 percent in January, the highest rate in over 15 years, and higher than the national average during the same month. 518,600 Illinoisans were out of work - more than any month since November 1985.
Major job losses are expected to continue in manufacturing, construction and retail. The Illinois unemployment rate is expected to climb to 9.7 percent in fiscal year 2010.
Housing
Housing starts fell an average of 25 percent in fiscal years 2007 and 2008, and Global Insight predicts that total Illinois housing starts will decrease by 48.3 percent in fiscal year 2009.
More than 14,200 homes in Illinois received a foreclosure filing in February 2009, an increase of 62 percent over last year.
Revenue & Spending
Our situation is a projected $11.6 billion deficit through fiscal year 2010, and a state that can't pay its bills on time.
Revenue is expected to decrease by $2.5 billion in fiscal year 2009 (from fiscal year 2008), and is projected to continue this decline through most of fiscal year 2010.
Increases in Medicaid, social services, employee benefits, and other required costs mean that spending would be $34.3 billion in fiscal year 2010 without reform and cuts.
Consequences of Inaction
Balancing the budget solely through deep cuts alone will hurt our citizens and further damage our economy:
- 800,000 people, including children, seniors and people with disabilities would lose health care coverage
- Over 34,000 teachers would be laid off, classes sizes would increase by 25 percent and per-pupil spending (Foundation Level) would return to $4,810 from $6,089
- 35,000 children would lose access to high-quality preschool
- More than 10,000 seniors served by homemakers would lose their services
- We would be forced to close one of four Illinois veterans' homes
- 17,000 fewer students would receive MAP Grants and 60,000 additional eligible applicants would be put on the waiting list
- We would have to lay off nearly 200 state police officers - over five percent of the force - jeopardizing public safety.
Tough Choices Must Be Made