With Illinois’ bottom-of-the-barrel credit rating, Moody’s Investors Service says the state’s continued population decline will make it more difficult to pay for government debt — and that could make the state’s credit rating even worse.
The most recent U.S. Census data indicate Illinois lost more than 37,500 people from July 2015 to July 2016. That marks the third straight year of declines, more than any other state in the country.
Moody’s Vice President and Senior Credit Officer Ted Hampton believes the continued trend is a bad omen.
“They’re symptoms of factors that may affect the state’s credit over time,” he said. “If the economy continues to be sub-par, that’s going to make it more difficult for the state to raise revenue, to balance its budget, to provide for its pension funding.”
Illinois owes more than $10 billion in unpaid bills and nearly $130 billion in unfunded pension liability. The state hasn’t had a truly balanced budget in more than a decade.
According to Hampton, states like Arizona outside of the region do draw Illinoisans away, but a lot of the migration data show people moving just across state lines.
“If the neighboring state has more employment opportunities than your state, then that is clearly one reason people might want to make that kind of move,” he said.
Hampton noted that both Indiana and Michigan saw faster job growth over the period when Illinois lost over 37,500 people.
–Illinois News Network