Economy of Chicago

Chicago and its suburbs, which together comprise the Chicago Metropolitan Area, is home to 36 Fortune 500 companies and is a transportation and distribution center. Manufacturing, printing, publishing, insurance, transportation, financial trading & services, and food processing also play major roles in the city's economy. The total economic output of Chicago in GMP totaled US$703.9B in 2018[1][2] making Chicago equivalent to the 20th[3] largest economy in the world[4] just surpassing the total economic output of Switzerland.

Real estate and corporate location

The central downtown area has experienced a resurgence, in contrast to recent years, with construction of major new condominium and Class A office buildings. These include the 92-story Trump Tower Chicago, Lakeshore East development, and the 300 North Lasalle office building. Since the recession, other projects, like the planned 150-story 2000 foot Chicago Spire by architect Santiago Calatrava, have now been cancelled.[5] Many city neighborhoods are gentrifying at a rapid pace as well, including Humboldt Park, Logan Square, Pilsen, Uptown, Near Southside, and Rogers Park. The massive expansion of O'Hare International Airport and recently reconstructed Dan Ryan Expressway will shape development patterns for years to come.

Changes in house prices for the Chicago metropolitan area are publicly tracked on a regular basis using the Case–Shiller index; the statistic is published by Standard & Poor's and is also a component of S&P's 10-city composite index of the value of the residential real estate market. Home prices in Chicago advanced 7.8% in March 2013 over March 2012[6]

Finance

Top publicly traded
companies in metro Chicago

according to revenues
with metro and U.S. rankings
Metro Corporation US
1 Walgreens Boots Alliance 17
2 Boeing 24
3 State Farm 33
4 Archer Daniels Midland 45
5 Caterpillar 74
6 United Continental 83
7 Allstate 84
8 Exelon 89
9 Deere 105
10 Mondelēz International 109
11 AbbVie 111
12 McDonald's 112
13 US Foods 124
14 Sears Holdings 127
15 Abbott Laboratories 135
16 Conagra Brands 197
17 CDW 199
18 Illinois Tool Works 202
19 Discover Financial 277
20 Baxter 281
21 W. W. Grainger 282
22 LKQ Corporation 304
23 Tenneco 322
24 Navistar 337
25 Univar 338
26 Anixter 359
27 RR Donnelley 388
28 Jones Lang LaSalle 391
29 Dover Corporation 392
30 Tree House Foods 427
31 Motorola Solutions 433
32 Old Republic International 439
33 Packaging Corporation of America 450
34 Ingredion 456
35 Arthur J. Gallagher 462
36 Essendant 487
Further information:
Companies in the Chicago area

Source: Fortune 500 2017[7]

The city houses one of the Federal Reserve Banks, established in 1914. There is also the Federal Home Loan Bank of Chicago. The largest banks in the Chicago region (by % of deposits) are: JPMorgan Chase, Bank of America (through its acquisition of LaSalle Bank), BMO Harris Bank (a BMO subsidiary), and Northern Trust. The largest banks headquartered in Chicago are: Northern Trust, BMO Harris Bank, Wintrust Financial, and First Midwest Bank. Many financial institutions are in the Loop.

Chicago has five major financial exchanges, including the Chicago Stock Exchange (CHX), the Chicago Board Options Exchange (CBOE), the Chicago Mercantile Exchange (CME), the Chicago Board of Trade (CBOT), and NYSE Arca. While the city of Chicago houses most of the major brokerage firms, many insurance companies are in the city or suburbs, such as Allstate Corporation.

In the 2017 Global Financial Centres Index, Chicago was ranked as having the seventh most competitive financial center in the world (alongside cities such as London, Singapore, Hong Kong, Sydney, Boston, and Toronto in the top 10), and third most competitive in the United States (after New York City and San Francisco).[8]

Largest employers

According to Reboot Illinois,[9] the largest employers in the city of Chicago are:

# Employer Employees
1 U.S. Government 49,860
2 Chicago Public Schools 39,094
3 City of Chicago 30,340
4 Cook County, Illinois 21,482
5 Advocate Health System 18,512
6 JPMorgan Chase 16,045
7 University of Chicago 15,452
8 State of Illinois 14,731
9 United Continental Holdings 14,000
10 AT&T Illinois 14,000
11 Walgreens 13,657
12 Abbott Laboratories 12,000
13 Presence Health 11,959
14 Chicago Transit Authority 11,100
15 University of Illinois at Chicago 9,900
16 Northwestern Memorial Healthcare 9,614
17 American Airlines 9,600
18 Jewel-Osco 9,155
19 Northwestern University 9,121
20 Allstate 7,808
21 Aon 7,667
22 Rush University Medical Center 7,500
23 Archdiocese of Chicago 7,500
24 Walmart 7,260
25 Northern Trust Company 6,644

Historic highlights

Before it was incorporated as a town in 1833, the primary industry was fur trading. In the 1770s, Jean Baptiste Pointe du Sable, the area's first resident and Haitian-born fur trader, established a fur trading post in the area which later became known as Fort Dearborn, along the bank of the Chicago River, where he traded until relocating again in 1800.[10]

The American Fur Company, established in 1808 by John Jacob Astor to compete with the powerful Canadian North West and Hudson Bay companies, practically took control of the fur trade in the United States following the War of 1812. It quickly became known for its ruthless practice of buying out or destroying the competition, as most private traders in Chicago soon found out. It appointed John Kinzie and Antoine Deschamps as its first agents in northern Illinois, and they reported to the company's headquarters on Mackinac Island. Their field of operations covered northeastern Illinois and the Illinois River. In 1819, Charles H. Beaubien was brought in to assist Kinzie and eventually became head of the outfit. Gurdon S. Hubbard replaced Deschamps in 1823 but soon went on his own by purchasing all interests of the company in Illinois.

Industrialization

Late in the 19th century, Chicago was part of the bicycle craze, as home to Western Wheel Company, which introduced stamping to the production process and significantly reduced costs,[11] while early in the 20th Century, the city was part of the automobile revolution, hosting the brass era car builder Bugmobile, which was founded there in 1907.[12]

It was also home to Grigsby-Grunow, which manufactured radios under the Majestic brand until the company failed in 1934.[13] (Majestic Radio and Television Corporation preserved the Majestic name, while General Household Utilities kept Grunow alive.)[14] Chicago also hosted E. H. Scott's Scott Transformer Company, which introduced a high-grade radio in 1928, and grew into Scott Radio Laboratories;[15] this was located at 4450 Ravenswood Avenue in 1946,[15] and produced "very expensive, beautifully-designed, chrome-plated chassis".[16] It added "a line of high-quality television sets in 1949".[17] Other entrants in this business were Zenith, which started life there in 1918, entering auto radios in the 1930s,[18] and Galvin Manufacturing Corporation, which started manufacturing power supplies in 1928 and went on to automobile radios under the Motorola marque in 1930,[19] as well as Walkie-talkie and Handie-Talkie and for the Army.[19]

During World War II, the steel mills in the city of Chicago alone accounted for 20% of all steel production in the United States and 10% of global production. The city produced more steel than the United Kingdom during the war, and surpassed Nazi Germany's output in 1943 (after barely missing in 1942). Some mills were located on the branches of the Chicago River emanating from the downtown area, but the largest mills were located along the Calumet River and Lake Calumet in the far south of the city. Over 200,000 people were employed in the steel industry at its peak in the 1950s and 1960s, but mass layoffs in the 1970s and 1980s devastated many working class south side neighborhoods that were heavily dependent on industrial jobs. Downsizing and plant closures continued into the 1990s and 2000s, and the US Dept of Commerce estimates that today fewer than 25,000 people are employed in the steel industry in the Chicago–Joliet–Naperville, IL–IN–WI Metropolitan Statistical Area (18,000 of whom are actually in Northwest Indiana.

In 1945, US Steel was Chicago's largest single employer, with 18,000 workers at the company's South Works.[20]

Massive amounts of goods passed through Chicago from places in the Mississippi Valley such as St. Louis, Missouri. Grain was stored in Chicago, and people began buying contracts on it. Later, people as far away as New York City began buying contracts by telegraph on the goods that would be stored in Chicago in the future. From this were established the Chicago Board of Trade (CBOT), the Chicago Mercantile Exchange (CME), and the modern systems in use today for futures and commodity trading.

Notable people

Chicago has produced many of the foremost industrialists, corporate lawyers, merchants, and financiers in United States history. Among the foremost of the Chicago industrialists, lawyers, financiers, and merchants were John Villiers Farwell, Edmund Dick Taylor, Potter Palmer, George Pullman, Charles Gray, Marshall Field, Richard Teller Crane, Martin Ryerson, John Jacob Glessner, Jacob Bunn, John Whitfield Bunn, John Graves Shedd, Cyrus Hall McCormick, Edward Avery Shedd, Charles Banks Shedd, Leander McCormick, Stanley Field, Charles Deering, James Deering, Robert Law, Francis Peabody, Leonard Richardson, Milo Barnum Richardson, Joseph Edward Otis, Frank Hatch Jones, Arthur Jerome Eddy, Arthur J. Caton, Nathaniel Kellogg Fairbank, Ezra Butler McCagg, Julius Rosenwald, Morris Selz, Harry Selz, William McCormick Blair, William Douglas Richardson, Charles Farwell, James Monroe Stryker and Jon Stryker of the Bunn–Richardson–Stryker–Taylor family (See: John Whitfield Bunn and Jacob Bunn), Samuel Insull, Max Adler, Lucius Fisher, Lucius Teeter, John Peter Altgeld, Walter Gurnee, Philip Danforth Armour, Gustavus Franklin Swift, Michael Morris, Jacob Best, Jonathan Y. Scammon, and many others.

See also

References

  1. ^ http://www.usmayors.org/wp-content/uploads/2018/06/Metro-Economies-GMP-June-2018.pdf
  2. ^ "12 American Cities That Rank Among The Biggest Economies In The World". Business Insider. Retrieved 2015-11-30.
  3. ^ https://fee.org/articles/many-us-metro-areas-have-greater-gdp-than-entire-developed-nations/
  4. ^ "If U.S. Cities Were Countries, How Would They Rank?". The Atlantic. Retrieved 2015-11-30.
  5. ^ "Death knell for Chicago Spire as receiver appointed". The Boston Irish Emigrant. 2010. Retrieved January 15, 2011.
  6. ^ Home price jump is more rebound than bubble
  7. ^ "Fortune 500 2017: Full List". Fortune. CNNMoney.
  8. ^ "The Global Financial Centres Index 21" (PDF). Long Finance. March 2017.
  9. ^ [1]
  10. ^ DuSable Heritage Association
  11. ^ Norcliffe, Glen. The Ride to Modernity: The Bicycle in Canada, 1869-1900 (Toronto: University of Toronto Press, 2001), p.107.
  12. ^ Clymer, Floyd. Treasury of Early American Automobiles, 1877-1925 (New York: Bonanza Books, 1950), p.178.
  13. ^ Mahon, Morgan E. A Flick of the Switch 1930–1950 (Antiques Electronics Supply, 1990), p.107.
  14. ^ Mahon, p.107.
  15. ^ a b Mahon, p.167.
  16. ^ Mahon, p.169.
  17. ^ Scott himself quit in 1945. Mahon, p.167.
  18. ^ Mahon, p.189.
  19. ^ a b Mahon, p.110.
  20. ^ Frum, David (2000). How We Got Here: The '70s. New York, New York: Basic Books. p. 22. ISBN 0-465-04195-7.
Cboe Global Markets

Cboe Global Markets is an American company that owns the Chicago Board Options Exchange and the stock exchange operator BATS Global Markets.

Chicago Board Options Exchange

The Chicago Board Options Exchange, located at 400 South LaSalle Street in Chicago, is the largest U.S. options exchange with annual trading volume that hovered around 1.27 billion contracts at the end of 2014. CBOE offers options on over 2,200 companies, 22 stock indices, and 140 exchange-traded funds (ETFs).

The Chicago Board of Trade established the Chicago Board Options Exchange in 1973. The first exchange to list standardized, exchange-traded stock options began its first day of trading on April 26, 1973, in celebration of the 125th birthday of the Chicago Board of Trade. The CBOE is regulated by the Securities and Exchange Commission and owned by Cboe Global Markets.

Chicago Board of Trade

The Chicago Board of Trade (CBOT), established on April 3, 1848, is one of the world's oldest futures and options exchanges. On July 12, 2007, the CBOT merged with the Chicago Mercantile Exchange (CME) to form CME Group. CBOT and three other exchanges (CME, NYMEX, and COMEX) now operate as designated contract markets (DCM) of the CME Group.

Chicago Curb Exchange

The Chicago Curb Exchange was an organized securities market and curb exchange located in Chicago, Illinois. It was alternately known as the Chicago Market.

Chicago Mercantile Exchange

The Chicago Mercantile Exchange (CME) (often called "the Chicago Merc", or "the Merc") is a global derivatives marketplace based in Chicago and located at 20 S. Wacker Drive. The CME was founded in 1898 as the Chicago Butter and Egg Board, an agricultural commodities exchange. Originally, the exchange was a non-profit organization. The Merc demutualized in November 2000, went public in December 2002, and merged with the Chicago Board of Trade in July 2007 to become a designated contract market of the CME Group Inc., which operates both markets. The Chairman and Chief Executive Officer of CME Group is Terrence A. Duffy, Bryan Durkin is President. On August 18, 2008, shareholders approved a merger with the New York Mercantile Exchange (NYMEX) and COMEX. CME, CBOT, NYMEX and, COMEX are now markets owned by CME Group.

Today, CME is the largest options and futures contracts open interest (number of contracts outstanding) of any futures exchange in the world, including any in New York City. The Merc trades several types of financial instruments: interest rates, equities, currencies, and commodities.

CME also pioneered the CME SPAN software that is used around the world as the official performance bond (margin) mechanism of 50 registered exchanges, clearing organizations, service bureaus, and regulatory agencies throughout the world.

Chicago Stock Exchange

The Chicago Stock Exchange (CHX) is a stock exchange in Chicago, Illinois. The exchange is a national securities exchange and Self-Regulatory Organization, which operates under the oversight of the U.S. Securities and Exchange Commission (SEC). The Chicago Stock Exchange is currently located at 440 South LaSalle Street (FOUR40).

Founded on March 21, 1882, in 1949, the Chicago Stock Exchange merged with the regional stock exchanges St. Louis Stock Exchange, Cleveland Stock Exchange and Minneapolis-St. Paul Stock Exchange to form the Midwest Stock Exchange. In 1959, the New Orleans Stock Exchange became part of the Midwest Stock Exchange, and in the early 1960s the Midwest Stock Exchange Service Corporation was established to provide centralized accounting for member firms. In 1993 it changed its name back to the Chicago Stock Exchange.

Demographics of Chicago

During its first century as a city, Chicago grew at a rate that ranked among the fastest growing in the world. Within the span of forty years, the city's population grew from slightly under 30,000 to over 1 million by 1890. By the close of the 19th century, Chicago was the fifth largest city in the world. Within fifty years of the Great Chicago Fire of 1871, the population had tripled to over 3 million.

Economy of Illinois

The economy of Illinois is the fifth largest by GDP in the United States and one of the most diversified economies in the world. The Chicago metropolitan area is home to many of the United States' largest companies, including Allstate, Boeing, Caterpillar, Kraft Heinz, McDonald's, Motorola, United Airlines, Walgreens, and more. The Chicago area headquarters a wide variety of financial institutions, and is home to the largest futures exchange in the world, the Chicago Mercantile Exchange.

The 2018 total gross state product for Illinois was $857 billion, placing it fifth in the nation. The 2015 median household income was $59,588. In 2016, the nine counties of the Chicago metropolitan area accounted for 77.3% of the state's total wages, with the remaining 93 counties at 22.7%. The state's industrial outputs include machinery, food processing, electrical equipment, chemical products, publishing, fabricated metal products and transportation equipment. Corn and soybeans are important agricultural products. Service industries of note are financial trading, higher education, logistics, and medicine.

Edible underwear

Edible underwear is a candy product which is made into a form and can function as underwear but which is edible.

The product was invented by David Sanderson and Lee Brady in 1975 when they formed a company Cosmorotics, Inc. to manufacture and market the product under the name "Candypants, the original 100% edible underwear." At first the U.S. Patent and Trademark Office denied their application for a patent on the basis that the idea of candy and pants were incompatible, but later granted the application and within weeks hundreds of thousands of pairs were manufactured and distributed out of the company's food manufacturing plant in Chicago, Illinois.

"Candypants" was promoted as lingerie in clothing shops, major department stores, motorcycle shops, candy stores and chic emporiums. It was considered naughty innocence. The press found it an outrageous delight and news coverage pushed edible underwear into the national and worldwide limelight. The product continues also to be sold through sex shops.

Candypants featured in two separate U.S. Supreme Court battles for First Amendment rights. Edible underwear, as "Candypants", was used by the defense for Screw magazine in their fight to stay on the newsstands despite their content and then again by the prosecution to attempt to shut down the late night Public-access television cable TV show Midnight Blue in New York City. At the same time author Jerzy Kosinski in his novel Pinball referred to it as 'the essence of American freedom' on the Late Night with David Letterman show.

In 1989, edible underwear was listed by People magazine as being one of the 434 names and events that define pop culture.

Gentrification of Chicago

The Gentrification of Chicago is a process that has altered the demographic composition of some neighborhoods in Chicago usually by decreasing the percentage of low-income minority residents and increasing the percentage of typically white, higher-income residents. Gentrification has been an issue between the residents of minority neighborhoods in Chicago who believe the influx of new residents destabilizes their communities, and the gentrifiers who see it as a process that economically improves a neighborhood. Researchers have debated the significance of its effects on the neighborhoods and whether or not it leads to the displacement of residents. There are some researchers who claim that the loss of affordable housing mainly impacts the poorer minority residents and causes them to have to move out of their neighborhoods which destabilizes their cultural communities. However, critics say that since gentrification often excludes highly black neighborhoods, those residents are prevented from benefiting from any of the positive effects such as redevelopment and neighborhood investment. Factors associated with and used to measure gentrification in Chicago are changes in the number of residents with bachelor's degrees, median household income, racial composition, visual observations, and the presence of coffee shops. Historically, the emergence of urban black and Latino neighborhoods in Chicago during the 1950s through the 1970s were made possible because of the waves of white residents moving out into more suburban neighborhoods. There have been phases of gentrification in Chicago of various neighborhoods, some of which were in 1990s and in 2007-2009. Gentrification debates in Chicago have been mostly focused around the gentrification of Chicago's historically Latino or black neighborhoods. Generally, these neighborhoods are located near the central urban downtown areas and along the east side of the city.

Gigabit Chicago

Gigabit Chicago is a gigabit-speed networking project in Chicago. It is a partnership of the State of Illinois, the City of Chicago and Gigabit Squared.

List of food manufacturers of Chicago

Since the 1830s, when Chicago enjoyed a brief period of importance as a local milling center for spring wheat, the city has long been a center for the conversion of raw farm products into edible goods. Since the 1880s, Chicago has also been home to leading firms in other areas of the food processing industry, including cereals, baked goods, and candy.In the twenty-first century, companies such as The Kraft Heinz Company, Wrigley, Sara Lee, and Tootsie Roll Industries, all maintain operations within the Chicago metropolitan area.

Northern Michigan

Northern Michigan, also known as Northern Lower Michigan or Upper Michigan (known colloquially to residents of more southerly parts of the state and summer residents from cities such as Chicago as "up north"), is a region of the U.S. state of Michigan. A popular tourist destination, it is home to several small- to medium-sized cities, extensive state and national forests, lakes and rivers, and a large portion of Great Lakes shoreline. The region has a significant seasonal population much like other regions that depend on tourism as their main industry. Northern Lower Michigan is distinct from the more northerly Upper Peninsula and Isle Royale, which, obviously, are also located in "northern" Michigan. In the northern-most 21 counties in the Lower Peninsula of Michigan, the total population of the region is 506,658 people.

OneChicago

OneChicago is a US-based all-electronic futures exchange with headquarters in Chicago, Illinois. The exchange offers approximately 12,509 single-stock futures (SSF) products with names such as IBM, Apple and Google. All trading is cleared through Options Clearing Corporation (OCC).

The exchange is owned jointly by IB Exchange Group (IB), CBOE Holdings, and CME Group. It is a privately held company that is regulated by both the Securities and Exchange Commission and the Commodity Futures Trading Commission.

Silicon Prairie

The Silicon Prairie, a take on the Silicon Valley, can refer to one of several places in the United States: in Illinois, particularly in Chicago; Texas; and a multi-state region loosely comprising parts of Minnesota, Wisconsin, Iowa, Missouri, Nebraska, and Kansas.

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