Reece: Alarming trends to watch in Illinois

Doug Whitley, president of the Illinois Chamber of Commerce, recently sent out a report titled “Illinois by the Numbers: Five Alarming Trends to Watch.” But first, the good news in the report is that Illinois has a diverse economy that benefits from much positive geographic and economic strength, including:

• Third largest population center and market in the country.

• Leading industrial and agricultural state.

• Center for international business, foreign consulates, direct foreign investment and a leading export state with direct airline access to countless global destinations.

• Economic capital of the heartland with extensive business and financial services.

• Headquarters for many multi-national corporations.

• Extensive transportation, distribution and infrastructure hub for all modes (including pipelines and fiber networks).

• Exceptional higher education and health care institutions.

• High quality and highly productive workforce.

• Easy access to an abundance and variety of competitively priced energy.

• Location in the center of the nation and Central Time Zone, which are conducive to business.

• Home to Chicago, a world-class, multi-cultural city with enviable cultural institutions and a reputation for high quality of life.

And yet for all the great things about Illinois, we’re trending the wrong way. I’m to the point of feeling that the orchestra (our political class) is tuning up while oblivious to the fact that the theater is burning down around them.

Here’s a summation of the report:

Trend 1: Illinois is losing residents. Each year, moving company United Van Lines conducts a study that tracks inbound and outbound migration trends throughout the country. In 2012, the study showed Illinois ranked second in the outbound category. The previous year, our state topped the list.
Trend 2: Illinois is hemorrhaging jobs. The state's population has declined dramatically, but the decline in jobs has been even worse.

As the State of Illinois Economic Forecast points out, Illinois' recession was more severe than the nation's, and its recovery has been slower. Illinois has recorded a net loss of 270,000 jobs since the beginning of the recession in December 2007.
Trend 3: Illinois' population is aging with serious implications for state budgets. The population of Illinois, like much of the U.S., is aging dramatically. Left unaddressed, this trend will continue to bring major financial shockwaves to our state and local governments, especially with regards to pensions and social services.
Trend 4: Poverty on the rise in Illinois. Two recently released reports shine a disturbing light on how the state's economic struggles have affected families. The results show pockets of poverty throughout the state's 102 counties.

Statistics cited in the Voices for Illinois Children's Illinois Kids Count 2013 report and Heartland Alliance 2013 Report on Illinois Poverty show that roughly 4.1 million Illinois residents – or about 33 percent of the state's population – live in or near poverty.
Trend 5: Illinois' growing tax burden. Think about it: The loss of hundreds of thousands of residents, the aging of the population and the resulting increase in non-taxed pension benefits, the rising poverty level and the need to care for those who are not self-sufficient with a growing reliance on government financed health care. Who is going to pay for the rising costs of government when there are fewer people actively engaged in the workforce?

The report continues: “We must conclude that much of our state's economy has continued to be successful in spite of failed government leadership and policies. It seems clear that Illinois' political leaders have too often focused on trying to resolve the government's problems, instead of taking a big-picture approach and looking for ways that government cooperation and participation can unleash the power of free enterprise.

“Some leaders believe the answer is to help Illinois residents by increasing taxes and providing more services. Others say we must make drastic, across-the-board cuts to stanch the fiscal bleeding. By pursuing policies that foster job creation, however, we can let the economy do much of the heavy lifting.”
Here’s a novel solution. How about focusing on private sector jobs and economic growth? A very doable, grow-our-way-out-of solution to the problem does exist.
The report goes on: “Imagine if we were able to close the 'jobs gap' suggested by the Brookings Institute and add 500,000 more people to Illinois' workforce – the tax revenue and economic benefits generated would be tremendous.”
Out of the 1 million small businesses in Illinois, 280,000 have employees. We’re talking less than an average of 2 employees each to get to 500,000.
“Illinois' elected leaders need to come together and find a way to make that goal a reality," Whitley writes. "We cannot be complacent about small job growth numbers. If we continue on the current path, our businesses and residents will be taxed out of Illinois or will continue to look beyond our state for greener pastures and peace of mind.”

Many other states have already figured it out so there is no need to re-create the wheel. It is way past the time to look at what is working elsewhere, implement it and begin the long overdue task to re-grow Illinois’ economy.

* * *

Join us fro, 5 to 7 p.m. March 26 for a multi-chamber mixer with “It’s All About Kids” hosted at 31 North Banquets and Conference Center, 217 N. Front Street, McHenry.

• Gary Reece is president of the Crystal Lake Chamber of Commerce. Email

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