Metro Economic Outlook: Chicago

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1 Metro Economic Outlook: Chicago The health care and technology industries, a resurgent manufacturing sector and a business-friendly environment for entrepreneurs are all providing strength to the Chicago area s economy. The region includes nine counties in Illinois, four counties in Indiana and one county in Wisconsin. Although many of Chicago s economic indicators have improved lately, it has taken quite some time for the region to hit its stride, said Liz Jellema, director of research for World Business Chicago, the area s publicprivate economic development entity. It s been a long recovery from the recession, Jellema said, largely because of our position with a big professional services footprint. Those sectors tend to CHICAGO METRO: VITAL STATS Total working age population: 5,816,762 out of a total population of 9,553,810 Number of households: 3,442,174 Consumer price index: (goods and services that cost $100 in cost $ in September 2015) Percentage of local residents with bachelor s degrees: 22.0 With graduate or professional degrees: 14.1 Student concentration: 74.2 college students per 1,000 residents Sources: Census Bureau (2014), Bureau of Labor Statistics (September 2015), American Institute for Economic Research (2014) Unemployment rate Source: Bureau of Labor Statistics (September 2015) take longer to bounce back, but we re seeing some positive signs. More people are getting back to work. The local tech sector is anchored by Internet marketing company Groupon, which has more than 2,000 people working at its Chicago headquarters. Elsewhere, San Francisco-based online review website Yelp is expanding locally in 2015 and will bring 300 jobs to the city. Braintree, an online payment software company, will also add 360 jobs in Chicago by Chicago officials have also made it easier to get a head start in the tech industry, due in part to the 1871 incubator facility. It opened in 2012 with 50,000 square feet of space, and now has the capacity to host as many as 400 start-up companies following an expansion in late As of the end of 2014, 40 companies had graduated from 1871 and created 500 local jobs, according to the State of Illinois. Unemployment and most CPI data updated monthly. Other data updated once annually as it becomes available.

2 On the heels of that success, city officials will launch an incubator for health care entrepreneurs. Slated to open in early 2015, it has already signed agreements with 50 start-up companies. Construction Mining and logging Manufacturing Trade, transportation and utilities Information Financial activities Professional and business services Education and health services Leisure and hospitality Among the locallyheadquartered Government Other services members of the Total nonfarm Fortune 500 list are aerospace interest Boeing, technology company Motorola, fast food restaurant giant McDonald s, and agricultural processor Archer Daniels Midland, which moved its corporate headquarters to Chicago in Labor force makeup Source: Bureau of Labor Statistics (January 2015) Some new efforts in the Chicago region are designed to grow businesses and retrain members of the workforce, in order to improve job seekers skills and ,000 2,000 3,000 4,000 5,000 Number in thousands match them with qualifications for local jobs. One of those programs, 1,000 Jobs for Chicagoland Manufacturing, hopes to place at least 1,000 residents in manufacturing jobs by the end of 2015, with a minimum benefits/salary package of $70,000. Part of the program will provide funding for six job placement/career coaching positions at a variety of workforce development organizations in the city. 638,191, 11% 1,325,973, 23% 534,249, 9% Source: Census Bureau (2014) Working age categories 649,825, 11% 1,297,514, 22% 1,371,010, 24% 20 to to to to to to 64 In 2014, local officials launched Chicago Anchors for a Strong Economy (CASE), a purchasing initiative that matches large employers, such as municipal, education and health care institutions, with smaller local suppliers. As of early 2015, 100 small businesses have completed the program s requirements and are now eligible to draw contracts from the 11 large employers that participate in the program, Jellema said. 2

3 Employee Benefits Data 25% 15% 5% Employers offering consumer-driven health plans 24% Employers in the Chicago metro area offer consumerdriven health plans at a slightly higher rate than the national level, by a margin of 4 percent Employers offering domestic partner benefits 57% 48% They are somewhat more likely to offer domestic partner benefits, by a margin of 9 percent above the national level. Source: SHRM Health Care Benefits Database (2014) Retirement Employee 401(k) participation rate 62% 63% The Chicago metro area s workforce has a slightly higher rate of 401(k) participation than the national level, by a margin of 1 percent. Source: SHRM Retirement & Welfare Benefits Database (2013) 3

4 Income and Turnover Data 15% 5% Overall turnover rate 17% 17% The turnover rate in the Chicago metro area s workforce is on par with the national level. Source: SHRM Human Capital Database (2014) Median household income $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $53,657 $61,598 Median household income in the Chicago metro area is higher than the national level by nearly $8,000 annually. $10,000 $0 Source: Census Bureau (2014) $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 Per capita income $28,889 $31,885 Per capita income is slightly higher than the national level, by about $3,000 annually. Source: Census Bureau (2014) 4

5 Top Management Salaries Data Median salaries, top management Top legal executive Chief information Top HR executive Chief financial Chief executive $340,600 $305,400 $218,800 $264,300 $185,400 $265,200 $268,100 $344,400 $600,000 $618,400 Median salaries for top management level employees in the Chicago metro area are typically lower than national levels, with legal executives earning more than the median. $0 $200,000 $400,000 $600,000 $800,000 Source: Towers Watson Data Services 2014 Survey Report on Top Management Compensation Project lead: Joseph Coombs, Senior Analyst, Workforce Trends, SHRM Project contributors: Alexander Alonso, Ph.D., SHRM-SCP, VP of Research; Jennifer Schramm, M. Phil., SHRM-SCP, Manager, Workforce Trends External contributors: Liz Jellema, World Business Chicago Copy editing: Katya Scanlan, copy editor This report is published by the Society for Human Resource Management (SHRM). All content is for informational purposes only and is not to be construed as a guaranteed outcome. SHRM cannot accept responsibility for any errors or omissions or any liability resulting from the use or misuse of any such information Society for Human Resource Management. All rights reserved. Printed in the United States of America. These materials and the data contained within them are copyrighted by SHRM, another copyright holder (where noted), or are government-owned. SHRM hereby grants permission for users to copy and use these materials and the data contained within them only if proper attribution is given to SHRM (or the noted copyright holder) as the source of the material. For more information, please contact: SHRM Research Department SHRM Human Capital Database 1800 Duke Street, Alexandria, VA 22314, USA Phone: (703) Fax: (703) SHRM Compensation Data Center [email protected] Web: 5