A worrisome job trend
Tuesday, Mar 5, 2019 - Posted by Rich Miller
* Hannah Meisel…
Illinois has lost the greatest number of jobs in some of the industries with the highest earnings over the last 10 years, while gaining jobs in the lowest-paying job sectors during the same period, according to the Commission on Government Forecasting and Accountability’s latest monthly report. While recent improvement in employment and wage growth in Illinois is “encouraging,” those long-term trends are “still concerning,” according to the report.
The industry with the highest weekly earnings — construction — is also the industry that lost the most jobs in Illinois during the last decade, according to the report. Workers in the construction industry earn an average of $1,424 per week, according to data from the federal Bureau of Labor Statistics, but jobs in the construction industry have decreased by 12.4 percent in Illinois since 2008. Similarly, jobs in the broad category of information, which earn an average of $1,335 per week, have decreased by 18.2 percent in Illinois since 2008.
During that same decade, industries like education and health services have been seen the biggest improvement in number of jobs — up 16.2 percent since 2008 — but that industry is among the lowest-paid in Illinois, earning an average of $814 per week. Jobs in the leisure and hospitality subsector have also seen a boom, but those are the lowest-paying jobs in Illinois, with an average weekly pay of $405, according to Bureau of Labor statistics. COGFA also points out that Illinois’ largest subsection, jobs classified as trade, transportation and utilities which employed over 1.2 million Illinoisans in 2018 and made up 20 percent of jobs in Illinois, “also has one of the lowest average weekly earnings totals in the state” — with average weekly earnings of $857.
However, recent trends are encouraging, like a 2.7 percent increase in construction — the state’s highest-paying industry, according to the report. Similarly, jobs under the umbrella of financial activities — another high-paying sector — increased by 2.1 percent during the last year after being essentially flat since 2008. “Time will tell if this recent growth in these higher paying jobs is the beginning of a long-term positive trend or just a temporary blip in an overall disappointing decade of employment activity in Illinois,” according to the report.
The full COGFA report is here.
- RNUG - Tuesday, Mar 5, 19 @ 1:36 pm:
One more argument in favor of a capital improvement bill. Now just have to find a way to pay for it …
- wordslinger - Tuesday, Mar 5, 19 @ 1:36 pm:
–The industry with the highest weekly earnings — construction — is also the industry that lost the most jobs in Illinois during the last decade, –
Maybe a capital plan is in order. Get to work on that willful neglect of state facilities euphemistically known as “deferred maintenance.”
- Downstate - Tuesday, Mar 5, 19 @ 1:53 pm:
Industrial developers are no longer looking at Illinois. The lack of attention to the state finances is scaring off most major employers looking to move or expand. This isn’t my observation, but rather the view of the industrial developers that I’ve spoken with. In addition, economic development people say they are embarrassed to give out their card when it has the words “illinois” on it.
Businesses will move and grow in states that are business friendly. If you think Illinois is sufficiently business friendly, then for you, “all is well”.
- Lester Holt’s Mustache - Tuesday, Mar 5, 19 @ 1:55 pm:
The saddest thing in that report is that education is one of the lowest paid sectors in the state. I don’t know how long Governors are going to want to continue bragging about what a well-educated workforce we have with that statistic staring them in the face. Pathetic really, and a WV/OK style statewide teachers strike wouldn’t surprise me one bit when considering that figure.
- 47th Ward - Tuesday, Mar 5, 19 @ 1:58 pm:
===economic development people say they are embarrassed to give out their card when it has the words “illinois” on it===
Maybe tell them to print West Indiana instead.
- Big Jer - Tuesday, Mar 5, 19 @ 2:02 pm:
Along with a capital improvement bill, we also need serious investment in affordable housing which would help the construction industry.
The headwinds on affordable housing are land use regulations, NIMBYs, costs of materials, and excessive federal, state, and local regulations in general.
While I do not want to see a repeat of the Grenfell Tower fire in London, which was due in part to shoddy building materials and enforcement of safety regulations, I think the fed, state, and local governments in the US go too far with the excess codes and regs especially in regards permits, etc.
- Lucky Pierre - Tuesday, Mar 5, 19 @ 2:03 pm:
During that same decade, industries like education and health services have been seen the biggest improvement in number of jobs — up 16.2 percent since 2008
Yet JB thinks the biggest reason for outmigration is Education funding and not Illinois business environment.
Private sector job growth is the key to paying for higher infrastructure spending not the other way around.
- JS Mill - Tuesday, Mar 5, 19 @ 2:07 pm:
= The lack of attention to the state finances is scaring off most major employers looking to move or expand.
Businesses will move and grow in states that are business friendly.=
So your answer is obviously we need a graduated income tax to pay the bills and shore up state finances like Minnesota and California.
Funny how we are not business friendly even though we give an awful lot of tax breaks to business. Not Wisconsin/Foxconn level, but not bad.
Maybe infrastructure would help with a capitol bill?
- Da Big Bad Wolf - Tuesday, Mar 5, 19 @ 2:09 pm:
The trajectory of some of these job catagories show improvement. Look at financial activities, professional and business services, trade utilities and transportation, and construction are going up since 2011.
Government and manufacturing seem to be flat. Information is going down.
- Anon1 - Tuesday, Mar 5, 19 @ 2:11 pm:
“trends are encouraging, like a 2.7 percent increase in construction…another high-paying sector — increased by 2.1 percent during the last year after being essentially flat since 2008. I wonder why?
- Anonymous - Tuesday, Mar 5, 19 @ 2:12 pm:
There is little to build as we are losing population.
- Lucky Pierre - Tuesday, Mar 5, 19 @ 2:21 pm:
Why on earth would Illinois have a statewide teachers strike similar to WV/OK that are ranked 48 and 49th in teacher compensation?
Illinois is rated #11 at just under $65K
http://blogs.edweek.org/edweek/teacherbeat/2018/04/teacher_pay_2017.html
- Anonymous - Tuesday, Mar 5, 19 @ 2:39 pm:
Just look at Wisconsin 5 years from now. The debt load and broken job promises will set them way back.
- Cheeser - Tuesday, Mar 5, 19 @ 2:41 pm:
Anonymous at 2:39 is me.
- wordslinger - Tuesday, Mar 5, 19 @ 2:53 pm:
Wow, Downstate, you make a lot of very broad, unsupported statements. Thanks for the word on the street.
But Illinois is perennially at the top of the list of new and expanding economic development projects, in overall number and by capita.
2017 Top States
by Number of Projects
2017 2016 State Projects
1 1 Texas 594
2 2 Ohio 467
3 3 Illinois 419
4 5 Georgia 281
5 4 North Carolina 274
6 6 California 262
7 7 Kentucky 248
8 9 Pennsylvania 185
9 8 Virginia 164
10 17 Indiana 162
2017 Top States
by Projects per capita
2017 2016 State Projects
1 1 Nebraska 110
2 2 Kentucky 248
3 3 Ohio 467
4 5 Illinois 419
5 9 Georgia 281
6 6 Iowa 86
7 7 North Carolina 274
8 4 Louisiana 115
9 13 South Carolina 119
10 17 Indiana 162
https://siteselection.com/issues/2018/mar/cover.cfm
- Anon - Tuesday, Mar 5, 19 @ 2:56 pm:
Lucky-
It is more of the bizzaro world we see around here anymore.
I was reading many today talking about our low taxes in Illinois, as if the 8th highest overall tax burden in the country is not sufficient to run a state our size on.
Then you see folks claiming our teachers pay is so bad it is worth a strike over, despite as you pointed out being 11th in the country.
We are essentially in the top 20% of both spending and taxing and yet if you only read Capfax you’d think we were a pauper state with no revenues or resources.
There is a large segment of folks completely detached from reality.
- Anonymous - Tuesday, Mar 5, 19 @ 2:58 pm:
Those companies must be adding few jobs. Illinois has had very slow job growth compared to the country overall for the last decade.
- Optimist - Tuesday, Mar 5, 19 @ 3:10 pm:
I’m so done with the doom and gloom. Everything becomes a self-fulfilling prophecy. I believe the best is yet to come.
- Anonymous - Tuesday, Mar 5, 19 @ 3:12 pm:
Anon, on top of your observations, Illinois also has a cost of living that is exactly the national average. Shouldn’t taxes reflect that?
- NeverPoliticallyCorrect - Tuesday, Mar 5, 19 @ 3:12 pm:
Lester Holt’s Mustache- you need to keep in mind that the category is Education and Health. The majority of teachers in the Chicago region are very well compensated (and that accounts for the majority of teachers statewide).
- Ares - Tuesday, Mar 5, 19 @ 3:39 pm:
There will be a massive need for skilled trades and for construction professionals with a capital plan in whatever form gets passed. Focus on training our own and let IN do its own thing as the “Mississippi of the Midwest”. We (and anybody) can do better.
- Da Big Bad Wolf - Tuesday, Mar 5, 19 @ 3:49 pm:
Construction projects can’t find enough workers. Part of the problem is construction workers are older, and more are retiring. So add to that increase in jobs (189,100 in 2012 to 226,300 in 2018) people moving into other positions that people are leaving.
- Da Big Bad Wolf - Tuesday, Mar 5, 19 @ 3:57 pm:
==We are essentially in the top 20% of both spending and taxing==
Yup. States with large populations tend to collect more revenue and spend it to take care of all those people. We can’t all be Wyoming.
- Just Me 2 - Tuesday, Mar 5, 19 @ 4:37 pm:
The best way to grow jobs is to mandate higher pay for employees.
- Chicago_Downstater - Tuesday, Mar 5, 19 @ 4:51 pm:
This is a fascinating report. Thanks for sharing.
You could actually read this as evidence that the minimum wage increase was well-timed.
The subsectors with some of the fastest growth include Education & Healthcare as well as Leisure & Hospitality. These are also two of the lowest paying subsectors.
That wage for L&H at 40 hrs a week comes out to about $10.13 per hour. And the E&HC comes out to about $20.35. If you factor out teacher pay, then I’m guessing E&HC drops drastically.
Now an increase in the minimum wage might lead to a slowdown in job growth in these subsections. Though that’s iffy considering that these would likely be the subsectors most insulated from the negative impacts (health care has a relatively inelastic demand curve as forgoing these services can lead to pain, poor health, and death) and/or most likely to benefit from positive impacts (more money in workers pockets = more money to spend on leisure activities as well as educational pursuits).
But even with a moderate slowdown in the growth of these subsections, an increase in take-home pay for these workers could be very beneficial to the state economy.
I’m making a lot of assumptions here, but I think they’re well-founded. And if correct, then maybe this report taken in conjunction with the recent minimum wage increase isn’t all doom and gloom after all.
Though that capital bill wouldn’t hurt any.
- Anonymous - Tuesday, Mar 5, 19 @ 5:04 pm:
Just Me 2, is that sarcasm or a joke?
- Billy5Wood - Wednesday, Mar 6, 19 @ 9:00 am:
Illinois has ranked 50th (last) in the country in new home construction since 2013. This is based upon a ratio of permits to state population. Many reasons for this, but what sets us apart from our neighbors is property taxation. Indiana is less than half our size and builds more homes than Illinois.