Jobs picture worsening in Illinois

[August 23, 2011]  SPRINGFIELD -- It's clear that finding or keeping a job in Illinois is getting tougher, but it is much less clear why.

Illinois' July unemployment numbers show that the state is bleeding jobs. The state's unemployment rate jumped from 9.1 percent in June to 9.5 percent, with Illinois losing 24,900 jobs.

"The question is why, and that's something that we're trying to answer," said Greg Rivara, spokesman for the Illinois Department of Employment Security.

Illinois' unemployment rate has been higher. In October 2010, the jobless rate reached 9.6 percent.

Gov. Pat Quinn has applauded Illinois' economic recovery, pointing to months of decline in the jobless rate.

Illinois' unemployment rate fell from 11.2 percent in January 2010 to 8.7 percent in April 2010. But May, June and now July of this year have seen the rate rise.

Jay Shattuck, a business consultant and lobbyist who works with the Illinois Chamber of Commerce and other business groups, said Illinois' economic uncertainty is coming home to roost.

"Employers are so concerned with a number of issues," said Shattuck. "Nobody knows what's going to happen. Are we going to have more taxes? Regulations? Nobody knows."

The state ratcheted up personal income taxes by 67 percent and corporate taxes by 57 percent earlier this year.

Kelly Kraft, a spokeswoman for Quinn's budget office, said there is "no connection" between the tax increases and the unemployment increase.

However, Kristina Rasmussen, executive vice president of the Illinois Policy Institute, a public policy think tank, said several businesses see a connection.

"The policies currently in place -- higher taxes, more spending and unreformed liabilities -- are clearly not working for those who are struggling to make ends meet," Rasmussen said.

Shattuck said the tax increase, and Illinois' overall business climate, are part of the uncertainty employers hate.

"That's why there are so many businesses hoarding cash; they want to be able to pay the bills," Shattuck added.

Illinois saw job losses in personal services, trade and transport, and government sectors. Manufacturing continued to add workers in July.

Shattuck said this summer's legislative hearings into Illinois' business climate may provide enough stability to convince employers in Illinois to start hiring.

"We're trying to come up with ways to advance the business climate without costing the state any money," Shattuck said. "But if we're going to lower the tax increase, that means other incentives have to go away. But which ones?"

[Illinois Statehouse News; By BENJAMIN YOUNT]