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* Decatur’s unemployment rate in November was slightly lower than the statewide average, at 9.9 percent, but this is gonna hurt bad…
Agribusiness conglomerate Archer Daniels Midland Co. announced plans Wednesday to cut 1,000 mostly salaried jobs as it navigates volatile global crops markets.
The move will cut 15 percent of the Decatur-based company’s corporate staff, about 3 percent of its total work force, CEO Patricia Woertz said in statement. […]
ADM said it first will offer employees a chance to voluntarily retire early if they are at least 57 years old and meet other requirements. Employees have until the end of January to take the retirement package. After that, the company will cut the remaining number of jobs needed to meet the 1,000 mark.
* Lots of those eliminated jobs will be in Decatur…
The company has yet to determine the number of positions affected at its headquarters in Decatur, although it would appear to observers that many of the cuts will affect jobs based locally. […]
ADM employs about 30,000 people worldwide, of which 4,300 people in the Decatur area are either salaried or hourly. The focus of the cuts will be on those in salaried positions at the corporate level, although ADM did not release the number of employees fitting that category.
* More…
“It’s kind of a bitter pill to swallow in that regard,” [Craig Coil, president of the Economic Development Corporation of Decatur and Macon County] said. “It’s one of those things we can’t control. We’ll automatically feel a disproportionate impact of that because of the fact we’re a fairly small community and they’re a major player in our community.”
Despite the plan to cut positions, Coil said ADM appears to remain committed to the Decatur area, and the reductions should not reflect negatively on Decatur itself.
Oy.
* Meanwhile…
CIT Group Inc. will no longer provide loans to Sears Holdings Corp. suppliers to finance their shipments to the retailer, a Bloomberg report said, citing two people familiar with the matter.
Sears shares fell 9.7 percent to $29.71 in premarket trading on the New York Stock Exchange. The shares dropped 56 percent last year.
CIT Group, the business lender run by Wall Street executive John Thain, will no longer approve credit for those waiting to be paid for orders delivered to Sears after today, the report said, citing unnamed sources.
* And here’s a spot of decent news…
Look for home foreclosures to rise here and nationally this year, but the worst is behind us.
That’s according to RealtyTrac, which released its latest report Thursday showing the number of homes hit with foreclosure filings in the Chicago metropolitan area fell 7.6 percent last month from a year earlier. Foreclosure activity was little changed from November as documentation issues continued to slow foreclosures here and across the country.
The continuing resolution of those document problems is what’s expected to push foreclosure activity up in 2012.
“The numbers in 2011 were artificially low because of the foreclosure delays, so we will see an uptick” this year, said RealtyTrac spokesman Daren Blomquist. “But we are past the peak in this foreclosure cycle.”
The report revealed 12,075 homes in the Chicago area received a foreclosure filing last month, 11 more than in November, or up 0.09 percent. Last month, one in every 313 homes in the area received a filing.
* But…
Homeowners insured with Allstate Corp. will soon be hit with rate increases of as much as 10 percent, the company said Wednesday.
Rate increases for renewals and new business will range from 4 percent to 10 percent annually, which translates into monthly increases of $4 to $9, effective March 26, said spokeswoman Shaundra Turner.
The rate hike is due to increased claims for water, wind and hail damage, Turner said.
posted by Rich Miller
Thursday, Jan 12, 12 @ 8:47 am
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With Sears not investing in its stores, closing 100 to 120 stores, and now having credit isssues one needs to ask: is chapter 11 in the future for Sears?
As a tax payer I would also ask if I have paid too much to keep jobs at Sears (currently about 6100 but possibly as low as 4250 under the agreement with the state) in Illinois? Are my tax dollars backing a loser?
Comment by Left Out Thursday, Jan 12, 12 @ 9:01 am
They just got a tax break, not money directly from the state if I recall correctly, so if they go away it is money the state wouldn’t see anyway
Comment by OneMan Thursday, Jan 12, 12 @ 9:09 am
I feel bad for the people of Decatur losing their
jobs.I hate to see anyone in our State lose a job.
We really need to stop the offshoring of our jobs.
To bad we don’t have a CEO who can just lay off our do nothing legislators in Springfield or cut their salaries in half.
Comment by mokenavince Thursday, Jan 12, 12 @ 9:42 am
Sears just keeps taking a pounding — bad Christmas, stock in a freefall.
Where’s their niche? They don’t compete on price or selection. They don’t offer a cool shopping experience. It’s hard to see an end game here, other than whacking it up. With the vast real estate holdings and some still strong brands, the sum of the parts is probably worth more than the whole.
Comment by wordslinger Thursday, Jan 12, 12 @ 9:43 am
How will that thousand ripple through Decatur? I assume the salaried positions are the bigger dollars. Restaurants, the hospitals, schools. There can easily be many people out of work as other employers adjust to purchasing changes. Ouch.
Comment by zatoichi Thursday, Jan 12, 12 @ 9:44 am
I feel bad for Decatur.
The federal ethanol subsidy did have to go, though.
Comment by Neva Thursday, Jan 12, 12 @ 10:12 am
No surprise on the ADM move. That industry has really changed. What the future holds for Decatur is truly terrifying. I would not be surprised if in the coming yearswe find Tate & Lyle move all of its corporate positions to Hoffman Esttes and lease the processing facility to someone like Bungie since T&L has more of a stake in artificial sweeteners than corn and soybeans. (like the former A.E. Staley).
Comment by Dirty Red Thursday, Jan 12, 12 @ 10:19 am
BAd economic news for the Illinois private sector? Nothing that a tax hike wouldn’t cure
Comment by Informer Thursday, Jan 12, 12 @ 11:12 am
I wonder what Bain Capital would do with Sears.
Other than ensuring a few investors would get most of the value out of it.
Comment by mark walker Thursday, Jan 12, 12 @ 11:44 am
Informer, ADM reported paying $10 million in state income taxes for FY 2011 on sales of $81 billion and net profits of $2 billion.
The annual report doesn’t break down which states it paid those income taxes to, but they have operations all over the country.
I don’t think the Illinois income tax is pushing them over the edge.
From the annual report:
Significant components of income taxes are as follows:
2011 2010 2009
(In millions)
Current
Federal $ 251 $ 422 $ 626
State 10 18 28
Foreign 222 195 139
Comment by wordslinger Thursday, Jan 12, 12 @ 11:46 am
It kind of surprise me that Decatur has a lower unemployment that the rest of the state. This is defiantly a bad hit for a city that has a lot of them. The lose of these jobs might well have spill over effect too.
Comment by RMWStanford Thursday, Jan 12, 12 @ 11:53 am
ADM has testified on the record that the Tenaska debacle will cost them over $4 million per year in Illinois. And the Decatur enterprise zone is one of the first set to expire next year so Decatur has a lot of problems coming soon.
Comment by 1776 Thursday, Jan 12, 12 @ 12:13 pm
wordslinger - sears is a hedge fund that happens to “operate” a retail business. It’s been that way since 2005. Over 50% of Sears Holdings is owned by a hedge fund.
Sears won’t be around long enough to collect its huge tax break.
That said, wasn’t John Thain the guy who ran Merrill Lynch into the ground? The same guy who spent over $1 million decorating his office just before ML tanked?
Why would anyone give him another job running a bank? Instead of getting punished, he gets another job? Another reason why the 1% are different than the rest of us. No accountability.
Comment by jerry 101 Thursday, Jan 12, 12 @ 1:11 pm
Re: Foreclosures - “the worst is behind us”.
Don’t think so. There’s too much confusion in the numbers. Naked Capitalism just had an extended discussion over this whole area, and the one thing that appears to be crystal clear is that there’s little clarity at all in the numbers.
Link is: http://www.nakedcapitalism.com/2012/01/michael-olenick-10-million-shadow-inventory-says-housing-market-is-a-long-way-from-the-bottom.html
When I see the banks and servicers doing their best to avoid/delay having to foreclose and actually take possession of even uncontested forfeitures, well, that does not strike me as a situation where “the worst is behind us”.
Comment by Judgment Day Thursday, Jan 12, 12 @ 1:16 pm
The federal subsidy did have to go but it sure did’t make the folks feel any better.
It’s time for an Illinois 1st job’s program. ADM made a ton of money it could have been more creative with it’s layed off employees. They dumped their most loyal salaried employees
Comment by mokenavince Thursday, Jan 12, 12 @ 4:32 pm
The subsidy means nothing. They got an ethanol mandate. Who needs a subsidy?
Comment by Rich Miller Thursday, Jan 12, 12 @ 4:36 pm