Illinois skirted a recession last year. Here’s what to know about the job market in 2024.

Vanessa Tejeda, 25, started a new job at Swedish Hospital in November.

Tejeda, a certified nursing assistant, lives in the Albany Park neighborhood with her three kids, who range in age from 1 to 6. She left her old job at a nursing home last year to care for her sick grandfather. When it was time to find a new job, she applied to work for a handful of nursing homes and hospitals on Indeed.

Tejeda received a couple of job offers she declined: One because the schedule wouldn’t allow to get her kids to school in the morning and one because it didn’t pay enough.

She likes her new job working overnights in a medical-surgical unit at Swedish: She makes about $20 an hour and gets off work at 7:30 in the morning, in time to get her kids ready for school.

“I actually plan to stay here as long as I can,” Tejeda said.

Hiring in health care, an industry that hemorrhaged workers during the pandemic, remained strong last year both in Illinois and across the U.S. Job growth also remained strong in the public sector, where payrolls were up in Illinois by 28,700 over the year in November, according to the Illinois Department of Employment Security. But though the U.S. is still adding jobs, economists have pointed to the slowing rate of that growth, and its concentration across just a few sectors, as a sign the labor market is weakening.

After a series of aggressive rate hikes meant to curb inflation, Federal Reserve officials are now predicting they’ll be able to bring inflation down to their desired goal of 2% without causing a recession, a feat Chicago Fed President Austan Goolsbee described as “the softest of all the soft landings” in December. Inflation dropped to 3.1% in November, down from a high of 9.1% in June 2022. The national unemployment rate edged down in November, to 3.7%.

Job growth has been slower to recover in post-pandemic Illinois — where the unemployment rate ticked up to 4.7% in November— than it has been elsewhere in the country, experts said. The number of Illinois residents with jobs increased in November, with payrolls up by 6,800 over the month prior. Compared with last November, total nonfarm payrolls were up 0.9% over the year in Illinois and 1.8% nationally.

In addition to health care and government, employment in Illinois grew over the year in areas such as arts and entertainment and accommodations and food service, industries that were also hit hard during the pandemic, according to Bureau of Labor Statistics and ZipRecruiter data. The state lost ground in sectors such as information, which includes the motion picture industry, publishing and other tech and media jobs. Illinois saw smaller drops in manufacturing and retail employment.

“The overall state of the labor market in Illinois is not meaningfully different than the country as a whole,” said Matthew Notowidigdo, a labor and health economist at the University of Chicago’s Booth School of Business.

“In a sense, I think that that itself is kind of bad news, because of the fact that aggregate employment growth in Illinois is continuing to lag the rest of the country,” he said.

Because of that lag, Notowidigdo said, he would hope to see the state adding more jobs to close the gap.

Most states have lower unemployment than they did before the pandemic, said Julia Pollak, chief economist at ZipRecruiter. Illinois is an exception, with an unemployment rate higher than it had pre-pandemic.

“We’re seeing a lot of competition for jobs among workers, and a lot of workers struggling to find jobs,” Pollak said of ZipRecruiter postings for Illinois jobs.

Experts said there wasn’t one reason why the state has experienced a slower recovery than other states.

Illinois has long dealt with stagnant population growth, which contributes to stagnant job growth, said Peter Bernstein, chief economist at RCF Economic & Financial Consulting in Chicago.

Illinois’ population declined by about 33,000 between July 2022 and July 2023 though it retained its ranking as the sixth most populous state, according to an annual census update released in December.

Notowidigdo noted the impact of the state’s cold weather on out-migration; while much has been made about the impact of taxes on business in Illinois, he said, “most people don’t choose where they want to live because of the tax rate.”

The Chicago area saw a series of business departures in 2022, including Ken Griffin’s decision to move his investment firm Citadel to Miami, while last year saw news of high-profile deals to bring jobs the state.

Stellantis agreed to bring a projected 2,500 jobs to Belvidere as part of an agreement reached with the United Auto Workers after the six-week-long autoworkers strike; the company had idled the plant indefinitely earlier in the year, putting about 1,200 people out of work. Also last year, Gov. J.B. Pritzker lured Chinese electric vehicle battery maker Gotion to Manteno with more than a half-billion dollars in state incentives. Officials say the plant will bring another 2,600 full-time jobs to the state.

Pollak said despite Illinois’ challenges, it benefits from a talented workforce, international immigration and less onerous occupational licensing requirements than some other states.

“(Illinois) probably has a worse reputation when it comes to taxes and restrictions and regulations and the business climate than are actually warranted by its policies,” Pollak said.

Local business and workforce development groups were largely optimistic about the coming year.

Chicago-based recruiting firm LaSalle Network surveyed several hundred finance, operations and human resources executives, finding about three-quarters planned to add to their head count in the coming year. CEO Tom Gimbel said Chicago benefits from a robust startup community and a constant flow of new graduates from local and Big 10 universities.

Bridget Altenburg, CEO of Skills for Chicagoland’s Future, an organization that helps connect unemployed or underemployed workers mostly from the South and West sides with Chicago-area employers, said the group expects to be able to make more job placements than it did last year based on conversations with the employers it partners with. (A recruiter from the organization helped connect Tejeda with her hospital job after she applied for it on Indeed.)

“Other than probably the financial sector, there’s still pretty significant hiring going on,” Altenburg said.

Meanwhile, economists are vexed by a problem some have described as political or even psychological: why many Americans feel so bad about the economy when the numbers largely seem to tell a different story. The disjoint between economic perceptions and reality, Goolsbee said in December, has “never been bigger.”

Economic commentator Kyla Scanlon dubbed the phenomenon a “vibecession,” and economists have struggled to explain the schism.

Experts have speculated the disjoint could be because people experienced the benefits of federal aid during the pandemic that then vanished; because their political beliefs influence how they view their economy; or because they simply can’t get past the sticker shock wrought by inflation, even if their wages have also gone up.

“Prices go up every month. Incomes don’t go up every month,” Bernstein said. “Only a few people each month are seeing a rise in their income, whereas everybody’s seeing a rise in prices.”

During the pandemic, Pollak said, many Americans received pandemic aid and were able to pay off debts. They saw their credit scores increase; their student loans payments were paused. Then the Federal Reserve raised interest rates, and the cost of that credit soared, she said.

“It’s been a period with so much change,” Pollak said. “Everyone has been a winner at some point and a loser at some point.”

As for Tejeda, she’s happy with her job at Swedish and she says she’s doing all right financially. But when she goes grocery shopping, $100 only goes far enough for a few meals.

She can’t work overtime until her orientation period is over, but when she can, she plans to do so to help fill in the gaps.

“I just feel like everything is still so expensive, and I have a lot of kids,” Tejeda said. “It’s not enough.”