The state agency responsible for conducting research for state lawmakers has a pessimistic outlook for Peoria's economic prospects in 2024.
The report prepared for the Illinois Commission of Government Forecasting and Accountability by Moody's Analytics and Economic & Consumer Credit Analytics specifically points to a lack of job growth in key industries such as manufacturing and health care to support this claim.
"Peoria’s economy is limping along," the report states.
It said Peoria’s unemployment rate is growing, while job growth remains stagnant. In December, the U.S. Bureau of Labor Statistics reported the Peoria metropolitan area's unemployment rate was 4.8%. That's up nearly 1% from December 2022. Nonfarm payroll employment was unchanged year-over-year.
Chris Setti, CEO of the Greater Peoria Economic Development Council, said he doesn’t necessarily disagree with the report's findings, but he said he'd instead describe Peoria's economy as "steady."
“I think that going into 2023, everybody had some concerns around the economy, nationally, and even internationally,” he said. “And we kind of came out the other side of 2023, in basically the same position that we were at the beginning.”
Setti said Peoria’s economy is different than some other major cities in downstate Illinois because it’s more reliant on industries such as manufacturing. He said Peoria is more tied into the global economy, so when the global economy experiences issues such as supply chain interruptions, that impacts Peoria’s economy more than it might other cities.
“Here we are in 2024 thinking there may be some global slowdowns, then that is probably going to disproportionately impact the Peoria area over a place like Springfield that doesn't have the same kind of manufacturing that we do,” Setti said.
Setti said Bloomington-Normal might be a more apt comparison community for Peoria because of the recent growth of electric vehicle manufacturer Rivian. Bloomington-Normal’s economy was described in the report as “cooled,” though that came before Rivian announced expanded production in Normal this week.
The report predicted that Peoria’s economy will remain stable for 2024, but said it could be one of the weaker performers in the state. There are some signs of uncertainty in the heavy machinery manufacturing sector that many of the Peoria's high-wage jobs depend upon, the report noted.
"For instance, the decrease in Caterpillar’s order backlog owes partly to the fact that supply-chain disruptions and long lead times are improving, but it also suggests slowing demand for agricultural, construction and mining machinery in the coming months," the report reads.
“As there are swings in the global economy, we're going to feel those swings because production is going to ramp up or they're going to ramp down,” Setti said. “And so we're always going to be a little bit more susceptible to things that are not within our control.”
The report notes the export share of the Peoria area's overall gross metro product is in the U.S. top 20. It also said large employers like Caterpillar and Boeing moving their headquarters out of state are creating concerns the companies may eventually leave Illinois on a much wider scale.
The report also notes Peoria's status as the most health care-dependant metropolitan area in the state economically, and says not much growth is predicted in that sector for the year ahead.
Setti said he was happy the report mentioned the $80 million Maui Jim expansion, but said investments in other industries should be highlighted, as well.
“They didn't make any mention of Precision Planting, and they just invested $100 million plus in a brand new facility that opened towards the end of last year in Morton,” he said. “They kind of talk about health care, but zero mention in health care of the ($250 million) OSF Cancer Center.”
Read more: Inside OSF HealthCare's $237 million, nearly finished Cancer Institute
Setti said he’s looking forward to seeing the impacts these investments might have on the economy.
“I would say for people who live here, it actually will bring people to our region and there's some job growth opportunities in this and hopefully maybe some opportunities around hospitality, especially with the cancer center,” he said. “We won't know for a while, but it is a differentiator in our economy that a lot of people can't say that they have.”
