State’s economy shows upticks, downturns

Bill Knight column for 1-30, 31 or 2-1, 2020

Illinois’ overall economy cannot be described by Charles Dickens’ opening of “A Tale of Two Cities” – “It was the best of times, it was the worst of times; it was the age of wisdom, it was the age of foolishness…”

It’s neither.

However, for some businesses and too many jobless neighbors, things are just OK or clearly lousy.

The state ended 2019 on a positive note, according to the University of Illinois’ Institute of Government & Public Affairs, although Illinois also shows some 1,400 jobs planned for elimination, employers reported.

The “U of I Flash Index” wound up the year showing an increase from 105.4 to 105.6, the institute said.

That monthly indicator of Illinois’ economy compiled by economist J. Fred Giertz is a weighted average of growth rates in corporate earnings, consumer spending, and personal income estimated from receipts for corporate income, personal income and retail sales taxes, all adjusted for inflation. Readings above 100 denote growth.

“This is obviously a great improvement, especially considering the problems Illinois has faced that continue to trouble the state,” Giertz said. “Illinois has had to deal with the general decline in manufacturing employment that has plagued the Midwest, small decreases in population, and the self-inflicted problems associated with an unbalanced fiscal condition.”

However, a major Illinois manufacturer, a retail chain with 28 locations statewide, and the parent company for the state’s largest health insurer, Blue Cross and Blue Shield of Illinois, together announced hundreds of layoffs and store closures.

Navistar, maker of International trucks, last month said it’s planning to cut 1,300 jobs globally, citing falling demand for heavy-duty trucks. The move will reduce by about 10% world-wide employment at the corporation, based in Lisle, Ill.

The company hasn’t said where the job losses will occur, except that jobs will be eliminated at North American facilities.

The same day, Blue Cross/Blue Shield owner Health Care Service Corp., based in Chicago, reported plans to lay off dozens of employees, but didn’t say how many Illinoisans would be affected. No reason was given by the corporation, which made a profit of more than $4 billion in 2018, financial statements showed.

Elsewhere, two prominent home-goods retailers announced intentions to close multiple locations in Illinois. Bed Bath & Beyond, headquartered in New Jersey, said it’s shutting down 40 U.S. sites, including stores in Chicago, Mount Prospect and McHenry. And the Texas-based Pier 1 Import said it may close some 450 stores, and some investment experts said Pier 1 management may be considering bankruptcy.

Pier 1 also didn’t give a number for workers losing employment, but the retailer has locations in Peoria, Springfield, Decatur and Rockford, plus 24 in Chicagoland.

Elsewhere last week, California-based Schurman Fine Papers declared bankruptcy and said it’s closing its 254 Papyrus stores, including six in Illinois; the Texas-headquartered Bar Louie also declared bankruptcy and announced plans to close 38 locations, including sites in Naperville and Chicago; and Bakers Square closed its Springfield location.

Meanwhile, the Illinois Department of Commerce and Economic Opportunity’s latest Worker Adjustment and Retraining Notification (WARN) report logged listed 1,457 jobs to be permanently lost.

The employers shedding jobs are:

* The East Peoria engineering firm AECOM said it lost a contract and may lay off 77 people;

* Airport Supersaver Inc. of Chicago, a bus service, is closing, and 52 workers will be permanently laid off;

* the Alco Manufacturing Holding Corp. of Machesney Park also is closing, and 49 people will lose their jobs;

* Chicago Lakeshore Hospital is permanently laying off 275 employees;

* Chicago Trolley Company cited “financial” factors in closing and laying off 91;

* dormakaba USA Inc., a Steeleville hardware manufacturer, is closing and laying off 56;

* the GSI Group (Grain Systems, Inc.) of Flora, Ill., a metal building manufacturer, is consolidating operations, and 89 people will lose their jobs;

* H&M International Transportation of Chicago said it lost a contract and needed to lay off 76 workers permanently;

* the restaurant chain Rock Sugar, Inc., based in Oak Brook, is shutting down and laying off 94 people;

* WestRock in Edwardsville is closing, and 68 people are losing employment there; and

* XPO Logistics Supply Chain, Inc. of Shorewood is consolidating and laying off 530 workers.

No, it’d be exaggeration to say circumstances are the best or worst. But employers and workers alike still have Great Expectations.