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 The Land of Lincoln is considered the third-worst state to invest in, according
to a new survey of CEOs.
Illinois was behind only New York and California. The survey, conducted by
marketing firm Development Counsellors International, or DCI, polled hundreds of
corporate executives. Though Illinois escaped being dead last overall, 29
percent of those polled ranked Illinois the worst in the nation.
DCI conducts its survey once every three years, and for the last three surveys
in 2011, 2014 and 2017, Illinois has been ranked third-worst. Executives cited
New York and California’s high costs of living as well as their large tax
burdens as the primary reasons for those states being ranked last, a position
the states have traded back and forth over the past two decades.
The report notes executives’ view of Illinois has worsened considerably in the
years following the Great Recession.
Those surveyed blamed Illinois’ political dysfunction and had a negative
perception of the state’s public sector. However, the report notes executives
had a positive view of Illinois’ skilled workforce.
Illinoisans shouldn’t be surprised to find the Prairie State ranked among the
worst states to invest in by CEOs. Illinois has some of the highest property
taxes in the nation, as well as the highest workers’ compensation costs in the
region. On top of both of those factors, Illinois lawmakers passed a 32 personal
income tax hike and a 33 percent corporate income tax hike in July 2017.
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Despite those massive
tax increases, businesses have little reason to expect a more stable
political and tax environment in Illinois.
The state’s $250 billion in pension debt, constant deficit spending
and serial credit downgrades to one notch above “junk” status make
Illinois look like an unreliable partner. Large companies and CEOs
seeking stability are likely to look elsewhere.
However, while large corporate investment is important, the key to
jobs growth and investment in Illinois is in small business.
Businesses with fewer than 50 employees created 75 percent of net
new jobs in Illinois in 2016. And from 2011 to 2016, businesses with
fewer than 500 employees were responsible for 79 percent of jobs
created.
If Illinoisans want to see real improvements in jobs growth from
businesses of all sizes and a better reputation for business
investment, lawmakers should embrace pro-growth policies.
That includes aggressive reform of Illinois’ property tax system,
getting state spending under control and addressing Springfield’s
sinkhole of debt.
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