The headline in today’s Chicago Tribune trumpeted the headquarters move of MillerCoors to Chicago. In exchange for $20million in aid, about 300-400 headquarters jobs will move to Chicago. The article goes on to wax eloquently about how Chicago is a "winner" city because of its great quality of life (read article here). Unfortunately, the article is a whitewash of the economic reality in Chicago and Illinois. Chicago’s mayor and governor are trying to focus on symbols, like acquiring a new company headquarters, rather than look at the results. Because the reality is that Chicago and Illinois have been on a long-term job decline.
The brutal reality can be found by downloading the PDF located here. What you’ll see is that from 1990 through 2007 Illinois, and Chicago as by far its largest job hub, has trailed not only the nation in job creation, but even the rest of the midwest (Indiana, Iowa, Michigan [yes, even auto-dependent Michigan], Missouri and Wisconsin). Chart after chart details how every sector of employment has been significantly trailing the national growth rate – and even far behind the region. Chicago may be a great city to live in, but it’s not a great city to be employed – or look for a job. Especially if your talents are on the leading edge of growth businesses.
What matters in business is results. And competitively, Chicago and Illinois have not met the challenge for almost 2 decades. Year after year Chicago becomes more of a "fly over" for people working on both coasts. Even though the University of Illinois is one of the top 5 engineering schools on the planet, most graduates leave to work on a coast (think Marc Andreeson and Netscape and you’ve got he message). When innovators create a new product as a result of working at Kraft or Motorola, they have to go to a coast to find funding, employees to grow the business and talented service people that can aid their growth. Large companies in Chicago are shrinking as competition steals competitors to the coast, or offshore.
In the midwest it’s common for people to relate their life to a family farm which exists today, or is a mere one generation away. But just like these midwestern urbanites migrated to the largest midwestern city, Chicago, because there were no jobs in the rural hinterlands, we now see midwesterners are forced to migrate coastal in order to maintain employment or find funding for new ventures.
By focusing on something as trivial as a headquarters win the city and state do a disservice to its citizens. This symbol overlooks the need for a much higher growth rate. Housing did not crash in Chicago like it has in LA, but it never went up nearly as much either. With few jobs, there was less demand and the boom never set in like it did elsewhere. People in Chicago cannot hope to see their city flourish if it cannot win the competition for jobs by developing more opportunities. Yes Boeing moved its HQ to Chicago, but we all know the planes are made in Seattle, and that’s where the jobs are. MillerCoors may be in Chicago, but the beer is made in Milwaukee and Denver. Neither "win" comes close to offsetting the losses from the closing of BankOne and operations move to New York, or the closing of Ameritech and operations move to Texas (just 2 recent examples of massive job losses). Or the failure of Lucent and Motorola to maintain their health thus causing tens of thousands of jobs to move to both coasts and India.
Chicago and Illinois leaders still focus too much on maintaining old Lock-ins, trying to Defend & Extend what the city was when it was the manufacturing and transportation center of America 50 years ago. For example, Chicago is no longer the city of Capone and Dillinger. By denying gambling, Chicago’s hold as the conference center of America shifted to Las Vegas while tourists flocked to Merrillville, IN or Milwaukee, WI to enjoy an evening. Yet the paranoia about its past stops Chicago from doing the obvious and legalizing casinos like cities/states have done within 75 miles. Or take for example the refusal to build a domed stadium in Chicago where weather which is less than ideal. While everyone knows a domed stadium would help bring in major events from around the globe, the city refuses to consider one as it relishes in the glory of aged facilities like Soldier and Wrigley Field. The last all-star baseball game in Chicago was delayed 8 hours due to rain, and everyone watched and wondered if the White Sox would play in the snow to win the World Series. Great is their past, and beautiful is the architecture – but Locking-in to that past is now costing citizens tax revenue and jobs! {note to readers – yes I know the Sox play in the renamed Comiskey Park and not Wrigley – but why didn’t the city dome that when it was rebuilt?}
The situation in Chicago is not dire, but neither is it good. Unless the IT jobs, healthcare jobs, biotech jobs and other occupations upon which the planet’s future is based make their way to Chicago, the city will some day be as well known as Dodge City – but possibly about as popular (Dodge City has under 50,000 people and is so far off the beaten path I challenge you to identify its location within 150 miles – hint, it’s in Kansas, not Arizona or California.) To find the future which will keep Chicago vibrant its leaders must focus on scenarios for growth, and realize they must COMPETE with cities that offer many benefits. Then the mayor and his leadership team must Disrupt Lock-ins to tradition, and use White Space to discover a new Success Formula which can regain growth leadership. If the current mayor Daily wants to have a legacy which eclipses his father, he must reset the agenda for growth by focusing on jobs – not merely symbols.