Chicago Economic & Finance News

[Vlajos]

Originally Posted by bnk

I was just going to post that and was wondering if that is new news or news we knew was comming. Either way its good.

Here is another take from Crains

New news!

[the urban politician]

Chicago has been performing very poorly in many economic parameters, and appears to have been doing so for quite a while.

It ranks highly as a "global city" for what it's worth, but I wonder if that is due to some sort of legacy. What is Chicago doing to compete?

Chicago is at risk for becoming not just the 3rd, but perhaps the 4th or even 5th most economically important metro in the US. At this point I'm seeing next to nothing in Chicago's future that will change that trajectory.

Tech: Bay Area and New England
Job growth: pretty much everywhere but Chicago
Finance: New York
Entertainment: LA
Manufacturing: pretty much everywhere else

Where is Chicago going to excel? Pizza? Hell, NY even beats it in that category as well. Chicago used to actually measure itself up to New York, but now in seemingly every category Chicago just comes nowhere near it. What happened?

Chicago needs to take a BOLD step. I'm talking about a complete reboot: present itself to the world as CHICAGO 2.0--an, edgier & more sophisticated version of itself. I'm tired of hearing blues music played every time Chicago presents itself to the world. Who even listens to the blues? How about allowing those damn animated signs on the Mag Mile? When will this 'understated conservatism' crap finally end? What is Chicago doing to become something greater and more bold than it currently is? Luring Kraft and Sara Lee are just not going to cut it.

[Hayward]

I'm not sure what that big bold step would be though. I think the city is doing a fine job with the construction of new parks, expansion of cultural institutions, improving the lakefront and riverfront, as well as diversifying what's located in the loop will bring more people to the city, and encourage companies to locate here.

I can't tell you how many people I know who are desperate to move to the city. They just need the job offer and they'll move in a heartbeat.

Of course you need a friendly business climate. That's top priority.

[BorisMolotov]

^ First of all, how dare you say NY has better pizza, there's nothing better than Chicago pizza (of all kinds), hell they can't even get it right in Madison which is only 2 hours away and has tons of ex-Chicagoans.

But I feel that Chicago is doing fine and as midwest manufacturing begins to pick up along with the oil booms in North Dakota and Ohio and potentially natural gas here in Illinois if Obama has his way we may see Chicago's transportation hub status be reaffirmed and expanded yet again. There is something Chicago has that really none of those other cities or regions that you mentioned have and that is our centralized location in the US. That fact alone has made Chicago what it is today and will continue to be an important factor for logistics and transportation until instant teleportation is invented.

Finally, Chicago is very good and important to many of those industries just not the best or most important for any of them. We're good at everything but great at nothing. However, I believe that this diversification will serve us well in the long run, as we've seen over and over again throughout history that one-industry towns are subject to both busts and booms which can absolutely destroy that city. By having such a diverse economy Chicago is much more resilient to these busts and booms.

While you might be right TUP, everyone I know (and this may be a midwestern bias) loves Chicago and most people I know would move there or at least to the area if given the chance. And you're right about our perception. I'm not sure if the media loves to portray Chicago as the home of gangsters and blues still, because I know everyone tries to dispel that image and a BOLD step as you say would help that. What did you have in mind?

[lawfin]

4th or 5th ?? By what measurement. None that I have seen.

Oh and those animated signs on michigan ave would clearly vault us into position as the 2nd coming of Rome

[ardecila]

One thing I would consider is to rethink the Planned Manufacturing District. Many of them already exist in sub-par locations with small parcels of land, heavy environmental cleanup needs and poor highway access - not to mention encroaching development pressure. These barriers need to be removed, and the availability of these sites needs to be trumpeted. It would need to be done in such a way that it doesn't just shuffle businesses around Chicagoland. We could offer publicly-funded toxic cleanup and roadway improvements, and work to consolidate parcels and lure manufacturers. Maybe close some streets to allow for larger sites. I'd love to get a right-to-work bill like Indiana, but that's obviously never gonna happen.

Another thing is to lure immigration, both of the skilled and unskilled variety. We're already a top destination for Mexicans and Chinese, but people from other Latin nations, Africa, and Asia largely bypass Chicago for the coasts and, increasingly, the Sunbelt. Push the INS to scale back on their deportations, and create social structures to help bring immigrant businessmen in contact with the old guard to cross-pollinate ideas.

Reduce city bureaucracy - not in some ideological quest to shrink government, but in order to create a permissive culture. In Chicago, I need 20 approvals and authorizations before I start a business or make a change to my property. If I'm doing new construction, the permitting process is a nightmare, horrendously inefficient and full of leech expediters. We need a city where people do things and ask questions later, even if a few people get miffed here and there.

Lastly, encourage venture-capital and other financing industries to set up here, so that Chicagoans with ideas don't need to leave in order to pursue them. The smart people out in Silicon Valley sure as hell aren't native Californians, and they're not there because of some vague "creative community". It's all about the funding, and currently, they can't find it here in Chicago. It doesn't need to be tech-focused necessarily - I love the innovations being made in agriculture and food science, which speak to Chicago's heritage.

[j korzeniowski]

Originally Posted by the urban politician

Chicago has been performing very poorly in many economic parameters, and appears to have been doing so for quite a while.

It ranks highly as a "global city" for what it's worth, but I wonder if that is due to some sort of legacy. What is Chicago doing to compete?

Chicago is at risk for becoming not just the 3rd, but perhaps the 4th or even 5th most economically important metro in the US. At this point I'm seeing next to nothing in Chicago's future that will change that trajectory.

Tech: Bay Area and New England
Job growth: pretty much everywhere but Chicago
Finance: New York
Entertainment: LA
Manufacturing: pretty much everywhere else

Where is Chicago going to excel? Pizza? Hell, NY even beats it in that category as well. Chicago used to actually measure itself up to New York, but now in seemingly every category Chicago just comes nowhere near it. What happened?

Chicago needs to take a BOLD step. I'm talking about a complete reboot: present itself to the world as CHICAGO 2.0--an, edgier & more sophisticated version of itself. I'm tired of hearing blues music played every time Chicago presents itself to the world. Who even listens to the blues? How about allowing those damn animated signs on the Mag Mile? When will this 'understated conservatism' crap finally end? What is Chicago doing to become something greater and more bold than it currently is? Luring Kraft and Sara Lee are just not going to cut it.

the hell?

chicago ranks as a top 10 business center worldwide. i do not know where this doom and gloom comes from.

here, calm down a little:

http://www.theatlanticcities.com/job...ld/109/#slide4

also, your pizza comment is just stupid.

[the urban politician]

Originally Posted by j korzeniowski

the hell?

chicago ranks as a top 10 business center worldwide. i do not know where this doom and gloom comes from.

here, calm down a little:

http://www.theatlanticcities.com/job...ld/109/#slide4

also, your pizza comment is just stupid.

^ This is exactly my point. There is too much complacency out there. "We ranked x on the global cities survey, so don't worry we are fine".

But is it? Chicago is doing worse than most American cities in job growth and unemployment. It never shows up on any list that ranks technology centers or growth in technology jobs. It is stagnant while the rest of the nation/world is growing/catching up. This is not a satisfactory status quo.

[VivaLFuego]

Originally Posted by the urban politician

^ This is exactly my point. There is too much complacency out there. "We ranked x on the global cities survey, so don't worry we are fine".

But is it? Chicago is doing worse than most American cities in job growth and unemployment. It never shows up on any list that ranks technology centers or growth in technology jobs. It is stagnant while the rest of the nation/world is growing/catching up. This is not a satisfactory status quo.

Getting the city's and state's financial health in order is probably the single most important step in positioning for growth. Trying to "brand" the city would miss the point, especially in a city that is blessed with a remarkably diverse economic base, multi-level connectivity (regional/national/global), and broad workforce skillset.

There are also macroeconomic forces that are out of the city or state's control --- Houston (and Texas as a whole), for example, is a tremendous beneficiary of NAFTA, whose impact on job growth along our country's southern border and southern ports can't be understated.

[the urban politician]

Originally Posted by ardecila

One thing I would consider is to rethink the Planned Manufacturing District. Many of them already exist in sub-par locations with small parcels of land, heavy environmental cleanup needs and poor highway access - not to mention encroaching development pressure. These barriers need to be removed, and the availability of these sites needs to be trumpeted. It would need to be done in such a way that it doesn't just shuffle businesses around Chicagoland. We could offer publicly-funded toxic cleanup and roadway improvements, and work to consolidate parcels and lure manufacturers. Maybe close some streets to allow for larger sites. I'd love to get a right-to-work bill like Indiana, but that's obviously never gonna happen.

Another thing is to lure immigration, both of the skilled and unskilled variety. We're already a top destination for Mexicans and Chinese, but people from other Latin nations, Africa, and Asia largely bypass Chicago for the coasts and, increasingly, the Sunbelt. Push the INS to scale back on their deportations, and create social structures to help bring immigrant businessmen in contact with the old guard to cross-pollinate ideas.

^ A lot of these immigrants bypass Chicago because there isn't any work for them. I don't know how else one would "lure" immigrants other than to have employment for them. In the past decade, however, I have observed Chicago's cab drivers being less Indo-Pakistani and more African.

Reduce city bureaucracy - not in some ideological quest to shrink government, but in order to create a permissive culture. In Chicago, I need 20 approvals and authorizations before I start a business or make a change to my property. If I'm doing new construction, the permitting process is a nightmare, horrendously inefficient and full of leech expediters. We need a city where people do things and ask questions later, even if a few people get miffed here and there.

^ Couldn't agree more

Lastly, encourage venture-capital and other financing industries to set up here, so that Chicagoans with ideas don't need to leave in order to pursue them. The smart people out in Silicon Valley sure as hell aren't native Californians, and they're not there because of some vague "creative community". It's all about the funding, and currently, they can't find it here in Chicago. It doesn't need to be tech-focused necessarily - I love the innovations being made in agriculture and food science, which speak to Chicago's heritage.

^ Actually, this is one area where I think Chicago has been making strides.

My idea is more than all of this. Chicago needs to revamp its image. A major revamp: almost like a reboot. It isn't seen as a place that is hip or stylish, and there is no reason why this needs to be the case. Chicago pays a price by always presenting itself as the family-friendly moderately priced vacation destination. I know this may sound a bit silly and may even be unpopular, but I actually think Chicago needs to present a more edgy, style-focused, hyper-modern image of itself to the world. Like Arts Chicago, create a yearly fashion show of world class caliber, create a uniquely Chicago style that competes with anything else out there. With some brainstorming, I really think a lot can be done differently without having to make too many institutional changes.

[Vlajos]

Originally Posted by VivaLFuego

Getting the city's and state's financial health in order is probably the single most important step in positioning for growth. Trying to "brand" the city would miss the point, especially in a city that is blessed with a remarkably diverse economic base, multi-level connectivity (regional/national/global), and broad workforce skillset.

First let me state that the initial post is a bit overblown.

However, the quote above is really the most important thing right now.

[the urban politician]

Originally Posted by VivaLFuego

Getting the city's and state's financial health in order is probably the single most important step in positioning for growth. Trying to "brand" the city would miss the point, especially in a city that is blessed with a remarkably diverse economic base, multi-level connectivity (regional/national/global), and broad workforce skillset.

There are also macroeconomic forces that are out of the city or state's control --- Houston (and Texas as a whole), for example, is a tremendous beneficiary of NAFTA, whose impact on job growth along our country's southern border and southern ports can't be understated.

I don't disagree with any of this. The problem is, how do you fix the state's financial health without job growth? Pension reform comes to mind, but would that be enough?

Even then, I still feel Chicago has a 'branding' issue that its coastal counterparts don't have.

[Vlajos]

Originally Posted by the urban politician

I don't disagree with any of this. The problem is, how do you fix the state's financial health without job growth? Pension reform comes to mind, but would that be enough?

Even then, I still feel Chicago has a 'branding' issue that its coastal counterparts don't have.

Yes, pension reform will do a large part of it. BTW, IL had 0.9% job growth in 2011, which is pretty much average for the country.

[Nowhereman1280]

Originally Posted by the urban politician

I don't disagree with any of this. The problem is, how do you fix the state's financial health without job growth? Pension reform comes to mind, but would that be enough?

Even then, I still feel Chicago has a 'branding' issue that its coastal counterparts don't have.

I hate to say it, but Illinois needs a Scott Walker who is willing to do radical things that will probably cost him his job in order to break the backs of the union establishment here.

That will never happen in Illinois (and if it does Illinois will be the last state where it happens), but if it ever does Chicago will see a major economic boom. Fact is our economy is constantly sapped by this culture of entitlement where everyone expects a $70k/yr pension because they drove a street sweeper for 20 years. Sorry, that's imaginary money that doesn't exist and doesn't correlate to the value of the job in any capacity.

The state's disastrous financial situation is the primary problem for Chicago right now and trying to jumpstart development in the city with such an ongoing burden is like trying to sail with your anchor down.

[lawfin]

Originally Posted by Nowhereman1280

I hate to say it, but Illinois needs a Scott Walker who is willing to do radical things that will probably cost him his job in order to break the backs of the union establishment here.

That will never happen in Illinois (and if it does Illinois will be the last state where it happens), but if it ever does Chicago will see a major economic boom. Fact is our economy is constantly sapped by this culture of entitlement where everyone expects a $70k/yr pension because they drove a street sweeper for 20 years. Sorry, that's imaginary money that doesn't exist and doesn't correlate to the value of the job in any capacity.

The state's disastrous financial situation is the primary problem for Chicago right now and trying to jumpstart development in the city with such an ongoing burden is like trying to sail with your anchor down.

Put down the Ayn Rand crack pipe. Illinois is not doing great http://www.senatedem.ilga.gov/index....-job-creation-

but walker and wisconsin are doing worse:http://www.politifact.com/wisconsin/...0000-new-jobs/

And something like 15-16% of the workforce in Illinois unionized.....hardly indicative of a "culture of entitlement where everyone expects a $70k/yr pension because they drove a street sweeper for 20 years."

[Ch.G, Ch.G]

Originally Posted by lawfin

Put down the Ayn Rand crack pipe. Illinois is not doing great http://www.senatedem.ilga.gov/index....-job-creation-

but walker and wisconsin are doing worse:http://www.politifact.com/wisconsin/...0000-new-jobs/

And something like 15-16% of the workforce in Illinois unionized.....hardly indicative of a "culture of entitlement where everyone expects a $70k/yr pension because they drove a street sweeper for 20 years."

I don't know what Indiana's numbers are, but, to be fair, wouldn't that state be better for comparison's sake? I don't have much love for Scott Walker, but I also don't think that you can expect results so quickly. By contrast, Daniels has been at it in Indiana for the past seven years.

[Steely Dan]

what we actually need is for the illinois GOP to pull their collective head out of their ass and STOP NOMINATING SOCIAL CONSERVATIVE NEANDERTHAL ASS-HATS LIKE BRADY FOR GOVERNOR. 19th century knuckle-dragging troglodytes are NEVER going to win in illinois, it's simply way too dominated by a cosmopolitan metropolis. what can win here, though, are fiscally conservative/socially moderate GOPers like edgar and thompson.

do you know how badly the GOP would have trounced quinn if they would have just run a normal human being against him?

[the urban politician]

^+1 to this.

[lawfin]

For analysis of this topic among others I'd recommend Bill Testa's blog at the Chicago Fed. Re Chicago's performance esp over last decade this post from one of the readers of the blog is interesting:

"This article's message, that the Great Lakes cities will have to find a new "role in life" if they are to survive, hits the nail on the head. But I believe that the author's assertion that the region's problems stem from the region's over reliance on manufacturing industries may be misplaced. In my work, I rely (perhaps incorrectly) on the CES employment series. That series indicates that the share of jobs in manufacting industries in the year 2000 (the peak year of job counts) was 13.1% in the nation versus 13.7% in the Chicago region. (I don't follow the other urban areas discussed.) So, the manufacturing share of the Chicago region's job counts (I exclude the Indiana counties) was about the same as the nation's. Further, as manufacturing jobs started their slide during the decade flollowing the peak in 2000, Chicago manufacturing job counts, moved almost in lock step (r-squared of about .985), with a loss of about 35(+/-) jobs in the Chicago region for every loss of 1,000 manufacturing jobs in the nation. That data plot in no way suggests a greater volatility of manufacturing jobs in the Chicago area than in the nation. Another way to examine the issue is to regress the annual percentage changes in the Chicago region's manufacturing jobs against the annual percentage changes in the nation's manufacturing jobs. (Again, I used the CES series.) The regression coefficient is 1.04, and not statistically different from 1.0. So the vloatility of the two CES manufacturing jobs series is virtually identical.

My own interpretation of the data and the region's economic history is that the advantages once accorded by proximity to the Great Lakes shipping routes no longer exist, because, as your blog on the region's population amply suggests, the share of the region's population (consumers) living in the south and the west grows ever larger. Producers of both goods and services have to be close to their customers. As the upper midwest's share of consumers -- and therefore product destinations -- decreases, the greater will be the motivation to relocate distribution and administrative centers to where the markets have grown and are growing."


Chicago has decoupled itself largely from its manufacturing legacy at this point. The recovery in the 7th district is being largely driven by manufacturing. Since Chicago's economy is less reliant on Manufacturing now it is seeing less of a bump from the manufacturing recovery. I do not have numbers right now but I am fairly certain business services, where chicago's economy is more focused now, lags sustained recovery. If the recovery continues; business services will follow suit leading to a bump in Chicago's numbers

[Vlajos]

Originally Posted by Ch.G, Ch.G

I don't know what Indiana's numbers are, but, to be fair, wouldn't that state be better for comparison's sake? I don't have much love for Scott Walker, but I also don't think that you can expect results so quickly. By contrast, Daniels has been at it in Indiana for the past seven years.

Indiana isn't really doing much better.

http://data.bls.gov/timeseries/SMS18...a_tool=XGtable