Illinois Economic Policy Institute

The Illinois Economic Policy Institute is a new nonprofit organization which supports research and provides timely, candid, and dynamic analysis on major subjects affecting the economies of Illinois and the Midwest, specializing in the construction industry. The Illinois Economic Policy Institute uses advanced statistics, reliable surveying techniques, and the latest forecasting models to evaluate and generate public policies that empower individuals, policymakers, and lawmakers to make a positive impact.

Latest Research: Indiana’s Common Construction Wage

A June study by the Midwest Economic Policy Institute, the University of Illinois, and Smart Cities Prevail finds that Indiana’s Common Construction Wage (CCW) promotes positive labor market outcomes for both construction workers and contractors. Among ten key takeaways, Common Sense Construction: The Economic Impacts of Indiana’s Common Construction Wage reveals that CCW keeps Hoosier jobs local, does not increase total construction costs, and promotes a highly-skilled and highly-productive workforce. The policy boosts the Indiana economy by almost $700 million and supports a quarter of a billion dollars in total worker income throughout the state, promoting an upwardly-mobile economy for working families. Ultimately, the Common Construction Wage provides substantial economic benefits and improves public safety.

Spotlight: Federal Income Taxes for Illinois Workers

A recent Economic Commentary by the Illinois Economic Policy Institute investigates the effective tax rates paid by Illinois workers across occupations. The study– Illinois Federal Income Taxes: By Occupation, 2011-2013– finds that the majority of workers in Illinois (60 percent) pay federal income taxes and that the effective rate for all workers is 12.9 percent on average. Excluding those who pay no income tax, the effective federal income tax rate is 20.5 percent on average. The report also finds that various tax credits, loopholes, and accounting tactics challenge the progressivity of the system in practice: while Illinois CEOs and the rich pay only about 17 or 18 percent rates, teachers pay an effective federal income tax rate of 22 percent on average. Indeed, despite earning significantly less money, many workers in Illinois face similar average tax rates as CEOs and the rich. Steps must be taken in Congress to close wasteful credits and loopholes.

ICYMI: Union Members and Union Households

Two recent ILEPI studies analyze the current state of labor unions. In The State of the Unions 2014: A Profile of Unionization in Chicago, in Illinois, and in America, researchers at ILEPI, the University of Illinois, and the University of Chicago analyze the course of unionization. The report investigates unionization rates and the impact of unions on wages across demographic, education, sector, industry, and occupation classifications. Union and Nonunion Households: General Social Survey, 2000-2012 compares and contrasts the characteristics of individuals in union households to those of individuals in nonunion households. Union and nonunion households differ across many socioeconomic characteristics– including household composition, work and income traits, religiosity, political affiliation, and institutional confidence. Both lead to the conclusion that, despite the long-term gradual decline in union membership, labor unions continue to play a vital role in economic and social life in America.

Illinois vs. Missouri: Vehicular Infrastructure

A recent ILEPI Economic Commentary evaluates the differences between the street, bridge, and highway network of Illinois and Missouri. While it is certainly true that Illinois motorists face a higher per-gallon motor fuel tax, the higher rate is necessary to meet extraordinary demand and provide greater quality infrastructure in Illinois. Illinois motorists drive over 50 percent more vehicle miles and use over 50 percent more fuel annually than Missouri residents, Illinois received just one-quarter of its annual total highway revenues from the federal government compared to over one-half in Missouri, and the freight industry is significantly larger in Illinois. Meanwhile, Illinois’ bridges are in better condition than those in Missouri and back-end personal costs are lower for Illinois motorists since the roads are of higher quality. Illinois’ superior vehicular infrastructure system is one reason why the state’s economy is larger and growing faster compared to Missouri.

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