Private Sector Job Trends and The Illinois Structural Deficit
Private Sector Job Trends and The Illinois Structural Deficit: What Illinois’ Changing Economy Means For The Demand For Public Services and The State’s Fiscal Capacity to Fund Them
January 17, 2007
An analysis of the state's fiscal system finds that Illinois’ state deficit will increase to more than $6 Billion over the next five years, without adding or expanding any programs. This deficit increase is the result of a tax system that does not generate enough revenue to continue funding the current level of public services into the future, adjusting solely for inflation and population growth. This fiscal mismatch is called a “structural deficit.” In addition to an unsustainable state revenue system, the study also found that increasing the number of high paying jobs in the state will not solve the problem. This limited impact of high paying jobs on the state’s ability to generate revenue is a direct result of the longstanding structural flaws in the state fiscal system that severely limit Illinois' ability to generate revenue that responds adequately to economic growth.