State News Roundup
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Economic growth in Illinois remains shaky, according to the State Monitor report released by BMO Capital Markets Economics. Factory output has cooled, due to decreased global demand for major exports such as machinery and electronics. Employment growth is rocky, withpayrolls falling across the state. Government and construction sector employment is down 4.4% in the past year, due to low levels of state and local government payrolls. However, an upside to the local economy is growth in the housing market. “The housing market in Illinois is gradually healing, with existing home sales jumping nearly 16% in September,” said Dr. Sherry Cooper, Chief Economist of BMO Financial Group. “Although the state remains among the highest stress markets in the country, there are concretesigns of stabilization with prices jumping almost 6% between March and July.”
According to a report by the Center on Budget and Policy Priorities and the Economic Policy Institute, income inequality has grown in 45 states between the late 1990s and the early 2000s. Tennessee is one of the states whose income inequality grew.The Tennessean revealed that incomes for the bottom 20 percent of Tennessee households fell by 12 percent over the past decade, giving them the 19th-widest gap ofhousehold incomes in the nation. Elizabeth McNichol, a co-author of the report, called the decrease in income for Tennessee’s lowest earners “very significant,” attributing it to an economic climate littered by long periods of high employment and a federal minimum wage that hasn’t kept pace with the increasing cost of living.
The 2013 Economic Forecast released by the Greater Kansas City Chamber of Commerce on November 9 predicted that the area’s gross regional product could grow 0.5 percent faster than the U.S. GDP in 2013 and 2014. According to the Kansas City Business Journal, this is a sign that the local economy is recovering at a faster pace than the rest of the country, and could possibly result in an addition of 21,200 new jobsnext year. However, the tax increases and spending cuts that might go into affect in January could derail this economic growth. If the “fiscal cliff” is not prevented, Kansas City would lose 2,100 jobs come 2013. The forecast revealed that uncertainty surrounding the “fiscal cliff” has been “the key factor in limiting the private sector’s currently huge cash reserves for investment and hiring.”