After mass layoffs, a chilling look back at CAT’s plea for reforms

By Illinois Policy April 2017

In February 2012, Caterpillar’s then-CEO Doug Oberhelman outlined needed reforms to save Illinois manufacturing jobs. State lawmakers have failed to act, and the Land of Lincoln is the only state in the region to lose manufacturing jobs since.

For years, Illinois lawmakers have ignored cries for reform from Illinois manufacturers – an insult to more than half a million manufacturing workers who rely on a healthy industry to forge the state’s middle class.

One of those workers is Rick Schock. He’s been on third shift in assembly at Caterpillar’s Aurora plant for 12 years. But he will soon lose his job as part of the company’s plans to shutter production facilities there.

“When I first started you’d go in to a local bar on a Friday morning at 7 a.m. [after your shift ended] and it was like a Friday night. It was nice, the camaraderie,” Schock said. “We were a big family.”

“But now with the layoffs my stress level has been so high. When I look at the people at work, everyone looks defeated.”

One of the most straightforward pleas from one of manufacturing’s largest players came five years ago in February 2012, when Caterpillar’s then-CEO Doug Oberhelman penned an op-ed outlining how Illinois government must act in order to bring back manufacturing jobs.

His recommendations included real workers’ compensation reform and a balanced state budget that would provide long-term tax certainty and tax relief.

The mass layoffs at Caterpillar’s Aurora plant offers a chance to reflect on Oberhelman’s plea and how the state has fared since.

The results are in: Illinois is the only state in the region to suffer a net loss of manufacturing jobs in the last five years.

 

illinois manufacturing

“Business leaders are making decisions today on where to invest in the future,” Oberhelman wrote in 2012. “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.

“When Caterpillar and most other companies look to locate a new factory in the United States, Illinois is not in the running for such projects. It doesn’t have to be that way.”

Illinois’ high property taxes and high workers’ compensation costs hit manufacturing harder than any other sector of the state economy, discouraging investment and even pushing manufacturers out of Illinois to other states.

The Illinois Policy Institute has put forward a state budget plan that addresses both of these major cost drivers, while balancing the budget without tax hikes.

Until politicians focus on tackling foundational reforms, Illinois will continue to bleed jobs – and hardworking men and women will suffer.

TAGS: Aurora, Caterpillar, manufacturing, workers compensation

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