SPRINGFIELD, Ill. (WAND) — Illinois state lawmakers are getting a better idea of what the state's revenue will look like over the next year. The Illinois Department of Revenue and Governor's Office of Management and Budget said Thursday they are optimistic about the economic forecast.

Financial experts expect to see a recession in the second half of Fiscal Year 2023. However, Illinois leaders believe the country can recover from the slight recession during the third quarter of this year.

A recession could lead to a decline in overall economic activity, and House Republicans are concerned about the impact outmigration has on the state's tax revenue.

"The individual income tax, the sales tax, the corporate income tax have consistently been on an upward trend," said IDOR Director David Harris. "So, I can't really answer the question of individuals who may have left, what they would have paid." 

Rep. Martin McLaughlin (R-Lake Barrington) stressed that people leaving the state have higher income than people who move back to Illinois. Although, Illinois is making significant revenue from recreational marijuana. The state reached a milestone of more than $1.5 billion in adult-use sales during 2022.

GOMB Director Alexis Sturm explained video gaming is also providing a $65 million boost each month.

"That's been pretty level for the last year," said Sturm. "There doesn't seem to be a huge growth in the video gaming right now. But it did really surge back after the pandemic with just a lot of disposable income out there." 

Video gaming is expected to generate $780 million dollars for the capital projects fund. 

Meanwhile, the Pritzker administration said the expected downturn is not projected to be as widespread or severe as previous economic downturns. Although, many experts are anticipating a softening of the country's labor market.

"There's still a lot of job openings that are out there," Sturm said. "Perhaps the job openings will get scaled bask as opposed to layoffs, but just really not to the extent that we've seen in other recessions." 

Some lawmakers are also worried that Illinois still has a 4.7% unemployment rate while the federal average is 3.6%.

Rep. Travis Weaver (R-Pekin) said Illinois has the 48th lowest unemployment rate in the country. Weaver is concerned about what that number may look like with the potential recession.

"Typically we see unemployment lag recessions. I don't know that there's any reason that we can expect that we won't have a higher unemployment rate than the national average," Weaver said. "It's healthy today. I don't know that we can say that it's going to be healthy for much longer." 

Harris said the state's job market has been stable and relatively strong. He hopes to see that trend continue throughout the year. 

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