Illinoisans going out of state rather than out of work
Illinois employed 170,000 more workers before the Great Recession than it does today, the Illinois Policy Institute reported recently.
While in 2007 the state could boast 370,000 more employees than Wisconsin and Indiana combined, that is nowhere near the case anymore -- and Illinois job-seekers are a main reason. Indiana had a net gain of 20,000 Illinoisans in 2015, the most recent year of available data.
Illinois also suffered a net loss of more than 11,000 people to Wisconsin in 2015 and nearly 86,000 over the preceding decade. According to the Illinois Policy Institute, data from the Bureau of Labor Statistics, the Internal Revenue Service and the United States Census Bureau, residents aren't leaving Illinois because of retirement: The majority are adults in their prime working years.
Austin Berg, a senior writer for the Illinois Policy Institute, said that although Illinois now has more jobs than ever, the industries where those jobs are being created should concern lawmakers. The manufacturing industry isn’t recovering and in fact has seen a loss of 300,000 jobs since 2000. There are, on the other hand, a lot more jobs in state and local government, hospitality, and business and professional services.
In comparison, Indiana and Wisconsin have seen strong manufacturing comebacks, something Berg attributes in large part to right-to-work laws.
Indiana has been a right-to-work state since 2012, and Wisconsin followed suit in 2015. Illinois is now completely surrounded by states with right-to-work legislation. Both Indiana and Wisconsin have also made significant changes to collective bargaining laws and workers’ compensation.
Right-to-work laws are a complicated matter, with different political platforms presenting significantly different points of view on the matter. According to the Economic Policy Institute, "the laws lower wages and benefits, weaken workplace protections, and decrease the likelihood that employers will be required to negotiate with their employees."
The Illinois Policy Institute presents a different view, arguing that the legislation doesn't prevent collective bargaining. In fact, the institute points out that union membership in neighboring Indiana has increased since right-to-work laws went into effect. One thing is clear: The lack of right-to-work legislation has kept many businesses away from Illinois.
"Illinois Department of Commerce and Economic Opportunity Director Jim Schultz says more than 1,100 companies have blacklisted the state due to its lack of a Right-to-Work law," Berg wrote for the Illinois Policy Institute in the 2015 feature A Workers Right to Choose.
The Land of Lincoln is falling behind in lightening the burdens placed on business owners as well, with some of the highest workers’ compensation costs in the region and collective bargaining rules that let unions garner unreasonable pay and perks in local governments, Berg wrote.
The relatively high tax burden borne by individual workers in Illinois makes earning a living wage difficult, meaning they are willing to move to nearby states where a paycheck goes further.
While Illinois property taxes are some of the highest in the nation, Wisconsin’s are at a 70-year low, and the state cut income taxes in 2013 and 2014. In Indiana, property tax caps became law in 2010. Even with a significantly lower tax burden, Indiana and Wisconsin have state budget surpluses -- in stark contrast to Illinois’ seemingly unending budget woes.
Berg argues that the fault lies with the politicians and state leaders who have long ignored the growing trend in employment and tax laws.
“These differences and more expose a glaring lack of self-awareness among Illinois’ political class," he said. "In ignoring the success stories just beyond their borders, state lawmakers ignore the plight of their own people."
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