Bad news and some good news
Wednesday, Sep 7, 2011 - Posted by Rich Miller
* Companies that plan to lay off lots of workers are required to notify the state. The most recent report isn’t great…
Nearly 2,300 workers at a dozen companies in Illinois will lose their jobs over the next several weeks, employers informed the state of Illlinois last month.
An August report released by the Illinois Department of Commerce and Economic Opportunity shows that among the job cuts the state was notified of are 628 workers at Chicago Restaurant Partners, 497 workers at UTI Integrated Logistics, a general warehousing and storage company based in Edwardsville; 200 workers at Buske Lines Inc., a general freight trucking company also of Edwardsville; and 194 workers at Lowe’s Home Centers.
* About 800 of those jobs aren’t disappearing forever…
Fortune Brands Inc., for instance, said that technically it is eliminating 81 jobs as part of a reorganization. The company is splitting itself into a liquor company called Beam Inc. and a home/security company called Fortune Brands Home & Security. But a spokesperson said most of the workers, largely corporate staff, have been offered jobs by the Home & Security spinoff.
Likewise, a local joint venture between Chicago-based Levy Restaurants, Phil Stefani Signature Restaurants and Airport Restaurant Management, said it will lay off 628 workers because it recently lost a long-held contract to supply food concession services at McCormick Place convention center.
But Annemarie Strassel, spokesperson for Unite Here Local 1, which represents the workers, said the new contractor, a West Conshohocken, PA-based company called Savor, has agreed to rehire them and assume the contract, which will be renegotiated.
* And not every company has solid layoff plans…
Buske Lines Inc., a trucking company also based in Edwardsville said it will “possibly” lay off 200 workers as a result of a corporate buyout.
* But not all of today’s job news was bad…
Mayor Rahm Emanuel affirmed his commitment to bring more jobs to the Windy City as he joined the head of SeatonCorp in announcing 400 new jobs being created at its Chicago headquarters.
Emanuel said Chicago provides the perfect place for companies to expand and hire more people.
It’s no secret a lot of people are looking for work, but the head of SeatonCorp said the news is not all bad: The company is one of the fastest growing in the country and is adding 400 jobs to its Chicago headquarters.
* Meanwhile, state revenues are up, while federal income is down…
State-source tax revenue grew by more than $530 million last month over August 2010 figures […]
COGFA… reported Tuesday that overall revenue to the state was up 11.3 percent or $223 million last month. But while state-source revenue grew by about 32 percent, federal revenue was down $264 million or 66 percent from a year earlier
Personal income tax revenue grew by 68.2 percent last month and the corporate income tax was up by 93 percent. Both figures are greater than the 67 percent income tax increases enacted in January.
State sales tax revenue also was up by 11.7 percent.
Through two months of the new fiscal year, personal income taxes are up $825 million, sales taxes are up $128 million and corporate income taxes have risen $34 million.
So far, the state is well ahead of its revenue projections for the fiscal year, but it’s far too early to tell how this will all shake out.
The full COGFA report is here.
* Related…
* ComEd takes more heat, lays out improvement plan at Glenview meeting
* Emanuel plans to offer paid maternity leave to city employees
* IDOT reps showcase area road projects
- wordslinger - Wednesday, Sep 7, 11 @ 1:39 pm:
–Personal income tax revenue grew by 68.2 percent last month and the corporate income tax was up by 93 percent. Both figures are greater than the 67 percent income tax increases enacted in January.–
That certainly doesn’t fit the supply-side gloom-and-doom predictions for the tax increase. In fact, it appears that business is picking up.
- Cincinnatus - Wednesday, Sep 7, 11 @ 1:42 pm:
From the report:
August revenues rose $223 million despite a poor month for federal reimbursements. Personal and corporate income taxes jumped due to higher tax rates as compared to last year , while sales tax continues to perform quite well even as most economic measures indicate consumer weakness.
Also contributing to the monthly gain was an expected $73 million remaining payment related to the 10th riverboat license bid. August had one more receipting day as compared to the same month of last year.
- Rich Miller - Wednesday, Sep 7, 11 @ 1:58 pm:
Cincinnatus, if you recall, there was lots of doubt among conservatives that the tax hikes would actually produce the projected revenues.
- Small Town Liberal - Wednesday, Sep 7, 11 @ 2:00 pm:
Cinci - No one is overlooking the fact that revenues are up because the tax went up. However, if the revenue goes up by a bigger percentage than the tax increase, it would suggest that people and companies are making more money in spite of the increase. As Rich said, it’s too early to tell, but at least for the moment it doesn’t appear that the tax increase has hurt the economy.
- Cincinnatus - Wednesday, Sep 7, 11 @ 2:33 pm:
All,
Not arguing here. I was reading the report and posting when Wordslinger was posting.
I will say, that we’d have to look at the percentages of the increases because of the tax increases compared to total revenue increases to truly determine what effect the tax increases had in the overall revenue picture. We’d also have to deduct the one-time casino revenues. Too much arithmetic today and don’t feel like doing the analysis.
- Alexander cut the knot. - Wednesday, Sep 7, 11 @ 2:50 pm:
Small Town Liberal, you have to factor in that net operating loss deductions were suspended — a company may be paying more in taxes due to the rate, and more in taxes due to inability to use losses, and be doing worse than last year (i.e. no expansion, and possibly reductions in payroll).
- Fed up - Wednesday, Sep 7, 11 @ 4:24 pm:
Incomes are up slightly because 2010 was a terrible year for incomes.
- Fed up - Wednesday, Sep 7, 11 @ 4:29 pm:
Also Feds are taking less out of the check no social security so The states gets a bigger cut of your check.
- JustMe - Wednesday, Sep 7, 11 @ 8:29 pm:
Corporations with big losses during the recession, who have been starting to turn things around, weren’t paying taxes because they could carry their losses over. The tax increase law also disallowed those carryovers,and they are now paying something.
Fed Up — social security taxes are not deductible by the workers, so reducing them doesn’t increase your income tax.
Finally, the notion that raising taxes in January would bankrupt businesses by August is silly. Economic effects take time and there are countless factors that reinforce or counter the effect of any one factor. Saying the increased tax revenue to date proves higher taxes don’t hurt the economy is the equivalent of saying one cold week disproves global warming.