Illinois Income falls 12% in 6 years...

Proof that the decline of manufactoring in this state is really hamering the low and middle classes.... -------------------------------------------------------------------------------- Illinois incomes sinking Paychecks shrink more than $6,000 since 1999 By Barbara Rose Tribune staff reporter Published November 17, 2005 Illinois' median family income has dropped dramatically over the last six years, a sharper decline than in every other state except for Michigan, a new report reveals. The result is that household incomes here--adjusted for inflation--have fallen back to about where they were in 1989. These income losses, coming at a time when costs are rising for everything from housing to transportation, brings into sharp relief the troubling shift from good-paying manufacturing to lower-paying service jobs. Job growth, even during the booming 1990s, was fueled by lower-paying occupations and there's no sign this trend will reverse, the report said. Only two areas of the state--northeastern Illinois, anchored by Chicago, and the region south of East St. Louis--are expected to generate more high-wage jobs than low-wage jobs through 2012, according to the 94-page report, "The State of Working Illinois." The report was developed by the bipartisan Center for Tax and Budget Accountability in Chicago and Northern Illinois University with funding from the Joyce Foundation. It is the first in-depth look at how the nation's fifth-biggest economy is faring in a global economy in which factory jobs--which once supported families headed by workers with sometimes limited formal education--are rapidly disappearing. At the same time, job growth is being fueled by an expanding service industry, where the pay gap is widening between low-wage, low-skill jobs and higher-paying ones requiring college degrees. Median household income has fallen by 12 percent in Illinois since 1999. That represents a sharper loss than in any other state except for the 19 percent decline in Rust Belt Michigan, which has been battered by job losses in the auto sector. The Illinois decline is far higher than the nation's average decline of less than 4 percent for the six-year period, according to the report's authors. Illinois' median income of $46,132 in 2004, when adjusted for inflation, is about the same as in 1989, the report states. The only workers who scored sizeable wage gains since 1980 were those with college degrees, according to the report. The study confirms fears that many Illinois working families, especially minorities and women, are falling farther behind in an economy where good-paying jobs with benefits such as health insurance are harder to find. "It's clear we're at a very significant crossroads," said Ralph Matire, executive director for the Center for Tax and Budget Accountability. "Absolutely all net new job growth in this state has been in lower-paying service jobs. Generally speaking that means no health insurance benefits, no retirement, and working full-time for wages that pretty much cannot support a family of four." The report, modeled after the Washington-based Economic Policy Institute's biennial "The State of Working America," is intended to spark a policy debate about solutions. "Job creation is the single most important economic issue we've got in the state," Illinois Chamber of Commerce President Douglas Whitley said. "We have not benefited from the national recovery, and I think some Illinoisans have forgotten what prosperity looks like." Albert Eddington, 59, who raised five children in the once prosperous factory town of Galesburg, Ill., is a case in point. "At one time Galesburg was one of the best places to work," he said, ticking off the names of employers who have left town, including Maytag Corp., which began shutting down a refrigerator plant two years ago. Eddington, a lifelong factory worker, lost his $15.60 per hour Maytag job a year ago. Always before, he found another factory job, but not now. "They either offer part-time work or less than $7 an hour, everywhere from filling stations to restaurants to grocery stores," he said. "You just have to put your chin up and keep going. I don't really have any prospects now to speak of." Robert Hillyer, 35, another former Maytag worker who earned $14.75 per hour, went to welding school hoping to get a good job, but so far no luck. "There's not much around this area, I'm finding out," he said. In Chicago, Deneen White, 41, who worked for 22 years at Frederick Cooper Lamps on the city's Northwest Side until the plant shut down in August, has been filling out applications at fast-food restaurants and department stores. Their wages won't match the $12 per hour she made at Cooper, but she'd be happy to have a job. "I've even gone to day labor [sites] and waited all day without getting anything and wasted my bus fare," said White, who has lost 35 pounds from worry. Katherine Parks, 35, earned $11.50 per hour bagging potpourri for shipping at a distribution center on the Northwest Side until she got laid off a year before the business closed in the late 1990s. Now she works from her North Side home as a child-care provider in a state-subsidized program, earning $2.50 per child per hour, without benefits. "It gets hard at times," said the mother of three, who cares for as many as 12 children, working seven days a week. "You're basically barely making it." She said she holds out hope that her union, Service Employees International Union, which is negotiating with Illinois officials for better pay, will improve her situation. Union membership as well as education boosts real wages, according to "The State of Working Illinois." "From a worker standpoint, unions are one of the few things that led to higher wages and better benefits," said Matire. "There's still a role to play for unions. The question is, how do we take that role and make it positive" without hurting economic competitiveness. Caring for children and the elderly are among the fastest-growing occupations, yet also are among the lowest-paying, said Ann Ladky, executive director of Chicago-based advocacy group Women Employed. Women are disproportionately represented in lower-paying industries, the report said. "It's absolutely necessary that we figure out how to improve the quality and rewards of these jobs because they're very important to families," Ladky said. "There's just way too many women who are working full time and not earning enough to support themselves." The report documented a workforce that is growing more diverse, with minorities representing nearly one-third of workers last year, up from about 16 percent in 1980. Yet African-Americans and Hispanics have much higher rates of unemployment and earn far less than whites and Asians, even when they have comparable educational levels, the report found. "There clearly still is discrimination operating in the marketplace," Matire said. ---------- berose@tribune.com Copyright © 2005, Chicago Tribune>