Chervon, a Chinese-owned power tool manufacturer,
is moving its North American headquarters to Naperville, Ill. from Grand Rapids,
Mich., Crain’s Chicago Business reported. Chervon will move into an unoccupied
124,000-square-foot building along the I-88 corridor originally built for office
and research purposes for Swedish manufacturer SKF Group until the company
cancelled the move in 2015 and opted to sublease the building.
Chervon plans on consolidating 75 positions from its current headquarters in
Grand Rapids, as well as from its Illinois offices in South Barrington and
Geneva. The Naperville location will also gain 37 employees from Chervon’s
acquisition of Mount Prospect-based Robert Bosch Tool’s Skil and Skilsaw brands,
according to the Chicago Tribune.
And new jobs are also on the way.
Chervon plans on hiring 25 new workers in 2017 and another 75 in the next three
years.
Joe Turoff, chief marketing officer for Chervon North America, cited the
building’s location and the skills of the suburban workforce as the prime reason
for the move.
“Considering the location of our current employees, Naperville seemed like the
perfect city,” Turoff told the Chicago Tribune. He added, “Naperville is a
perfect location for talent acquisition.”
However, Chervon currently has no plans to move its manufacturing facility from
Michigan. The employees moved to Naperville and new hires going forward will be
in white-collar positions including in research and development, industrial
design and sales and marketing, Crain’s Chicago Business reported.
While this move is ultimately good for Chervon and Naperville, it mirrors the
overall jobs problem in Illinois.
From October 2015 to October 2016, the greater Chicago area, where white-collar
and service-sector jobs dominate, saw 33,500 new jobs. However, over that same
period, downstate Illinois, which relies on manufacturing, lost 2,700 jobs. This
makes the net jobs growth for Illinois 30,800 jobs, with all of it concentrated
around Chicago.
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While Chicago and its surrounding suburbs benefit from a close
proximity to major transportation hubs as well as a larger demand
for white-collar and service employees, the rest of the state is not
so lucky. Downstate communities like Mossville, Peoria and Belvidere
depend on manufacturing and blue-collar jobs.
Chervon’s plan to keep its manufacturing in Michigan and move its
headquarters to Naperville should come as no surprise. It is simply
the continuation of a sad trend of slow growth around Chicago, with
nothing for the rest of the state.
Illinois has some of the highest property taxes in the country, the
highest workers’ compensation costs in the Midwest and lacks a
statewide Right-to-Work law, all of which puts it at a competitive
disadvantage for attracting manufacturing jobs.
However, Michigan is different. After the Great Recession, Michigan
implemented pro-growth reforms including cutting taxes and passing
Right to Work. These reforms, in addition to the restructuring of
the auto industry, have revitalized Michigan’s once decimated
manufacturing sector. In 2015 alone, Michigan gained 11,300
manufacturing jobs while Illinois lost 6,200.
And Illinois’ jobs crisis and harmful economic policies are having
an effect.
From July 2015 to July 2016, Illinois lost a record 114,000 people
in net migration to other states. While out-migration from the Rust
Belt is higher than the rest of the country, Illinois’ net migration
is an outlier, even in the Midwest. After adjusting for state
population, Illinois’ out-migration rate is 3.2 times higher than
Michigan’s. And the biggest group leaving Illinois is working age
adults.
Michigan’s comeback is proof that Illinois can change course. The
Land of Lincoln can address the out-migration and manufacturing
crises with pro-growth policies that will benefit the whole state,
not just Chicago and its suburbs.
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