 Caterpillar Inc., the tractor and large-vehicle manufacturer, is considering
moving up to 800 manufacturing jobs out of its Aurora-based facility.
Caterpillar revealed in December 2016 that an unspecified number of layoffs at
unnamed plants were coming, and the Peoria-based manufacturer’s Aurora facility
might be on the chopping block. Caterpillar’s potential move comes after four
years of declining revenue and lower projected profits for 2017.
“Should we move forward with the decision to relocate production, we will
support the local leaders to mitigate the impact on our employees, their
families and the community,” said the company’s resource industries group
president, Denise Johnson.
If the move goes through, Caterpillar has proposed splitting the 800
manufacturing jobs between two locations, with production of large-wheel loaders
and compactors going to its Decatur-based facility and production of
medium-wheel loaders to its plant in Little Rock, Ark. Under this plan, the
Aurora location would remain only for engineering and product support purposes.
Unfortunately Aurora job losses would be only the latest in what has become a
dismal trend for CAT employees across the Prairie State. In 2016, Caterpillar
layoffs and consolidation efforts in East Peoria and Mossville cost over 500
jobs.
However, Caterpillar is not reducing its workforce everywhere.
Manufacturers like Caterpillar often prefer to locate in states with
Right-to-Work laws, which prevent workers from having to join or pay fees to a
union, even if they work in unionized workplaces. Arkansas, where some of the
Aurora jobs might be transferred, is among 26 Right-to-Work states. And so is
Arizona, where Caterpillar plans to add 600 jobs over five years, according to
the company’s May 2016 announcement.
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 In the wake of the November 2016 elections, it is likely that
both Missouri and Kentucky will pass their own Right-to-Work laws,
making every state bordering Illinois Right to Work. This will make
the Land of Lincoln, which does not have Right to Work, even less
competitive for manufacturing jobs, relative to its neighbors.
In addition to the lack of a Right-to-Work law, Illinois also has
the highest property taxes in the country, the highest workers’
compensation costs in the Midwest and the fifth-highest state and
local tax burden in the nation. As Caterpillar seeks to cut costs in
the face of waning profits, Illinois is simply becoming too
expensive.
Former Caterpillar CEO Doug Oberhelman warned in an op-ed in The
State Journal-Register in February 2012 that if Illinois politicians
didn’t implement reforms soon, the Land of Lincoln would see more
jobs, especially in manufacturing, flee across state lines:
“Business leaders are making decisions today on where to invest in
the future. Illinois must act now, with a bipartisan sense of
urgency, to position itself for future job creation that is being
discussed in boardrooms all across this country. I want Illinois to
be in the hunt for those types of investments, including investments
by Caterpillar. Illinois deserves it.”
Nearly five years later, state politicians still have not heeded
Oberhelman’s warning, and it’s blue-collar workers who are paying
the price.
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