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STEEL
MANUFACTURER SHUTTERS ILLINOIS PLANT, TAKES 100 JOBS TO INDIANA
Illinois Policy Institute/
Janelle Cammenga
Alliance Steel Corp. will move 100 jobs to
Gary, Indiana, with plans to add 30 more.
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 Illinois-based Alliance Steel Corp. will shutter its Bedford
Park facility and relocate just 25 miles across the state border to Gary,
Indiana. Alliance Steel currently employs 100 workers, and is aiming to add 30
more employees by 2023, according to the Indianapolis Star.
The company announced Dec. 5 that it would leave Illinois and invest $19.7
million in the new Gary facility. Renovations on the Gary site will begin in
2019, with the possibility of being operational as early as January 2020.
Alliance Steel has anticipated the move since 2017, when the company submitted a
nearly $1 million bid to the Redevelopment Commission in Gary for 25 acres of
land.
Alliance Steel CEO Andy Gross told the Associated Press that the Hoosier State
is “making all the right moves to recreate a very promising industrial area.”
Lower property taxes and more affordable workers’ compensation costs in Indiana
have proven attractive to Illinois manufacturers struggling in a far less
welcoming business climate. A 2018 study by the state of Oregon compared
workers’ comp premium rates across industries, ranking Indiana’s as
second-lowest in the nation. Illinois’ rates, meanwhile, are higher than nearly
all of its neighboring states, surpassed by only Wisconsin, the study found.
Hoist Liftruck, an industrial forklift manufacturer that operated near Alliance
Steel in Bedford Park, preceded the steel distributor when it moved to Indiana
in 2016, taking with it 300 jobs. Hoist President and CEO Marty Flaska said the
company would not have even considered leaving Illinois if not for its high
workers’ compensation costs and property taxes.
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Another manufacturer, Seal-Rite Door Inc., recently
announced plans to shutter its Rockford facility and expand
operations in Beloit, Wisconsin.
Alliance Steel and Seal-Rite Door are only the
latest to cross state lines to reach a lower tax burden and stronger
business climate. Wynright Corporation announced in September, for
example, that it will shutter both of its Illinois facilities and
relocate to Indiana.
This is not a new trend: In 2016 alone, Colbert Packaging
Corporation, Vonco Products LLC, Prestige Metal Products Inc. and
Haribo all either moved to or expanded operations in Wisconsin.
Enjoy Life Foods moved to Indiana that year.
Businesses in Illinois also face an excessive amount of regulations
and pay a high price in complying with them. Illinois’
Administrative Code is a massive document that would take a person
nearly 21 weeks to read – if he or she were reading 40 hours a week
at 300 words per minute, according to a 2017 study by the Mercatus
Center.
The high cost of doing business in Illinois, excessive regulations
and the ever-present threat of more tax hikes as the state struggles
with $7.3 billion in unpaid bills and up to up to $250 billion in
pension debt will keep new businesses from settling in Illinois
until reforms are made.
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