Study highlights retail’s economic impact statewide

Retail accounts for more than 10% of Illinois’ gross domestic product, according to the results of a study released Tuesday.

Rob Karr, president and CEO of the Illinois Retail Merchants Association, which commissioned the study, said retailers are essential to the state’s economy.

“What makes this study so special is that it is the first analysis of its kind that we’re aware of in Illinois to truly quantify the widespread economic impact that retail has throughout Illinois,” Karr said. “And the findings were clear: The retail sector is the cornerstone of the state’s economy and crucial to our everyday lives.”

The study was conducted by the University of Cincinnati Economics Center using 2022 data.

According to the study, retail generated $7.3 billion in income and sales tax revenue in 2022.

“Retail generates the second-largest revenue for the state of Illinois and the largest for local governments,” Karr said. “What does that mean? When retail succeeds, Illinois succeeds.”

Since 1.3 million people work in retail in Illinois, that makes the industry the state’s largest private sector employer — employing one out of every four workers in Illinois. Karr said that number equals the number of people employed in health care and manufacturing combined.

“The breadth and depth of the retail sector is wide,” Karr said.

Karr said the looming threat of President Donald Trump imposing tariffs on imported goods from Canada, Mexico, and China “introduces tremendous uncertainty” in the retail industry. Tariffs would leave retailers in the lurch and could lead to higher prices, he added.

“Price increases and inflation always impact people in terms of their shopping powers,” he said. “And again, we can’t bake everything into the price. We just have a limited ability to do that, because there is a point at which any product a consumer won’t pay for.”

At a separate news conference Tuesday, Gov. JB Pritzker echoed Karr’s statement about Trump-imposed tariffs causing “uncertainty.”

“We’re deeply concerned about that and the effect that it’ll have on businesses and jobs across the state of Illinois,” he said.

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