CHICAGO | Economic & Business Development

[Vlajos]

^ Wow, that combo would really put Chicago at the top of the US food industry.

[left of center]

Originally Posted by Vlajos

^ Wow, that combo would really put Chicago at the top of the US food industry.

Seconded. That would be excellent news for Chicago.

Now if only we can snag Cargill from suburban Minneapolis...

[Vlajos]

Originally Posted by left of center

Seconded. That would be excellent news for Chicago.

Now if only we can snag Cargill from suburban Minneapolis...

Unfortunately, Cargill is unlikely to leave MN. Would be great though.

Mars is quietly moving folks to the former Wrigley HQ on Goose Island.

[Vlajos]

http://www.chicagotribune.com/busine...625-story.html

Pilsen gentrification continues. My guess is this won't get push back from the anti progress crowd because the owners are latino.

[10023]

Originally Posted by marothisu

Hm interesting. GE Healthcare did over $18B in revenue in 2016, which would place them around 160th in this year's F500 rankings, about equivalent to Visa.

As an aside, revenue is a pretty stupid way to rank the importance of companies. Retail businesses have enormous top-line revenue but single-digit margins, because they’re really just passing through inventory, whereas software companies with 70-80% margins are much more valuable with much lower revenues. The nature of the business also affects the quality of the jobs (that software company has a lot more highly-paid employees than the retailer). But they do it because revenue is a fairly easily obtainable metric even for private companies, whereas ranking them on market value (or profits, or cash flow) would only be possible with a good degree of certainty for public companies.

[the urban politician]

Originally Posted by 10023

As an aside, revenue is a pretty stupid way to rank the importance of companies. Retail businesses have enormous top-line revenue but single-digit margins, because they’re really just passing through inventory, whereas software companies with 70-80% margins are much more valuable with much lower revenues. The nature of the business also affects the quality of the jobs (that software company has a lot more highly-paid employees than the retailer). But they do it because revenue is a fairly easily obtainable metric even for private companies, whereas ranking them on market value (or profits, or cash flow) would only be possible with a good degree of certainty for public companies.

Very good point

[the urban politician]

Originally Posted by Vlajos

http://www.chicagotribune.com/busine...625-story.html

Pilsen gentrification continues. My guess is this won't get push back from the anti progress crowd because the owners are latino.

I don’t have a Tribune account. Could anyone post highlights about this?

[10023]

Also, I wouldn’t worry about GE’s healthcare business being acquired. The list of medical device companies bigger than GE Healthcare is:

J&J
Medtronic

That’s it. And both of them would have serious antitrust concerns.

It’s a $70+ billion business by market value. It could participate in a merger someday but it’s not getting bought.

[left of center]

Originally Posted by the urban politician

I don’t have a Tribune account. Could anyone post highlights about this?

5 Rabbit plans brewery and restaurant in Pilsen
Source: http://www.chicagotribune.com/busine...625-story.html

Latin-themed beer-maker 5 Rabbit Cerveceria plans to open a small-batch brewery and restaurant early next year in a two-building loft office development in Pilsen, a neighborhood where increased investment is sparking concerns about gentrification.

The 7-year-old brewery has leased 12,000 square feet in a former warehouse at 1901 S. Sangamon St. that Chicago developer Condor Partners is redeveloping into loft offices.

5 Rabbit’s deal comes amid tensions in the neighborhood, where concerns about rising rents and decreasing Latino population have caused restaurants and other businesses to be tagged with anti-gentrification graffiti. But 5 Rabbit is known as a pioneer in Latin-themed brewing, using ingredients more commonly found in food across Latin America, such as chili peppers, herbs and spices in its beers.

...


Condor Partners is redeveloping the building where 5 Rabbit is leasing space, along with another long-vacant warehouse at 1911 S. Sangamon St., each of which have about 100,000 square feet of space. The former lumber storage buildings are more than a century old, McLean said.

The project is called Mural Park because it will include an outdoor art gallery in a plaza between the two buildings. Mural Park, between 19th and Cullerton streets, is along the planned 4-mile El Paseo bike and pedestrian trail on former rail tracks, which would connect the Pilsen and Little Village neighborhoods.

The developer is in talks with office tenants of 5,000 to 20,000 square feet for the 5 Rabbit building, and is seeking one or two large tenants for the south building, he said. The two-building redevelopment will cost $50 million, he said.

[left of center]

Originally Posted by 10023

Also, I wouldn’t worry about GE’s healthcare business being acquired. The list of medical device companies bigger than GE Healthcare is:

J&J
Medtronic

That’s it. And both of them would have serious antitrust concerns.

It’s a $70+ billion business by market value. It could participate in a merger someday but it’s not getting bought.

Well, that is certainly good news.

[marothisu]

Originally Posted by 10023

As an aside, revenue is a pretty stupid way to rank the importance of companies. Retail businesses have enormous top-line revenue but single-digit margins, because they’re really just passing through inventory, whereas software companies with 70-80% margins are much more valuable with much lower revenues. The nature of the business also affects the quality of the jobs (that software company has a lot more highly-paid employees than the retailer). But they do it because revenue is a fairly easily obtainable metric even for private companies, whereas ranking them on market value (or profits, or cash flow) would only be possible with a good degree of certainty for public companies.

Sure - I never said anything about that other than what its ranking of the Fortune 500 list would be. I was just stating a fact. That is completely separate from the opinion of the importance of revenue. People like these talking points in the media, so it's a positive for Chicago no matter how much you believe revenue matters or doesn't matter. Chicago will grow its lead on the bay area if everything stays, which counts for something.

[ardecila]

Originally Posted by sentinel

Crain's is becoming less and less cogent in why they allow guest/opinion writers, and frankly, it's making them less appealing because they aren't reporting business news, but providing a tit-for-tat platform, especially to spread misinformation, that inevitably needs to be responded to, seemingly to just pad their reader base:

Yesterday, a known Trump sympathizer turdkin, Charlie Kirk, blasted the City Treasurer, Kurt Summers for his investment strategy for the City's money, primarily because the long-term portfolio positions favor carbon or clean-energy-related investment strategies (I will not link to the article because I've decided I will no longer do that for Crains; you can visit the site yourself). It was a non-starter debate frankly, only to try to convince readers that the strategy was silly, ineffective and will lose money, essentially trying to smear the Treasurer's office by claiming they are gambling away the City's money by focusing on non-traditional investment opportunities.

Kurt Summers replied this morning, very clearly and gracefully stating the reasons behind his investment strategy, and how his strategy has been proven to provide a greater return on investment than portfolios that focus on traditional and dirty energy companies.

My problem with Crain's is that they are giving a platform to a uneducated, 23 year old Trump-loving, sycophant who's blindly reacting to a something he doesn't understand, namely how clean energy is a better strategy for long-term investment...solely to cater to an uneducated and reactionary section of the populace...they are helping further a cult of thoughtlessness by featuring people like Charlie Kirk.

Apologies, rant over. If you would like online resources that explain how renewable and clean energy companies are helping power the future of investing (which I am heavily invested in myself), I will gladly post resources anyone can use.

How is it misinformation if it is clearly published as an opinion piece? Newspapers have run opinion pieces for over a century now, but a well-run newspaper will separate the opinions from the pure reporting. Just because you don't agree with it doesn't mean it's an invalid opinion or it taints the other content in the newspaper. And if Crain's even allowed Kurt Summers to rebutt, I definitely don't see a problem.

I don't buy the Crain's hate, especially with the loss of DNAInfo they are often the only ones covering important local stories about city issues. The public should be aware of innovative and interesting things happening in the city's many businesses. It's often good news that provides a counterpoint to the depressing "if it bleeds, it leads" or corruption/anti-government coverage of other news sources.

[10023]

Originally Posted by marothisu

Sure - I never said anything about that other than what its ranking of the Fortune 500 list would be. I was just stating a fact. That is completely separate from the opinion of the importance of revenue. People like these talking points in the media, so it's a positive for Chicago no matter how much you believe revenue matters or doesn't matter. Chicago will grow its lead on the bay area if everything stays, which counts for something.

Yeah, but that’s exactly the issue. A lot of low-value businesses are ranked ahead of higher-value businesses, and tech is particularly under ranked because of the nature of the business (i.e., there is no marginal cost to sell another licence, so margins are extremely high). The media talks about it, but people who know about such things (people with influence) don’t pay any attention to it. It doesn’t really matter what Average Joe in the bleachers at Wrigley thinks.

The Fortune 500 is kind of king of all stupid lists with questionable methodologies. But hey, I posted the news, and it’s certainly a positive not a negative, even if the positive is extremely marginal.

[emathias]

Originally Posted by 10023

As an aside, revenue is a pretty stupid way to rank the importance of companies. Retail businesses have enormous top-line revenue but single-digit margins, because they’re really just passing through inventory, whereas software companies with 70-80% margins are much more valuable with much lower revenues. The nature of the business also affects the quality of the jobs (that software company has a lot more highly-paid employees than the retailer). But they do it because revenue is a fairly easily obtainable metric even for private companies, whereas ranking them on market value (or profits, or cash flow) would only be possible with a good degree of certainty for public companies.

That is all true, although revenue also reflects a company's ability to influence the economy through how it touches money flow. Even if a retailer doesn't keep very much of its revenue, it directs where that pass-through goes and, in doing so, exerts power that way. That's a type of a power a high-net software company doesn't have (a few do, but most don't).

[moorhosj]

This is a mea culpa, as I was apparently too negative on the state and metro unemployment numbers from last month. The new metro area unemployment numbers just came out and have unemployment rates of 3.5% for Illinois (lower than Texas) and 3.3% for Chicago-Naperville-Arlington Heights (lower than Seattle, Dallas, Philly, NYC and LA).

The state and metro labor forces grew slightly over the month, but the metro fell over the year. Maybe more importantly, there are 57,800 more payroll employees in Illinois than one year ago and 32,500 more in Chicago-Naperville-Arlington Heights.

[left of center]

Wow, 3.5%? That's lower than the national average as well. Great to hear, but almost seems too good to be true, considering how Illinois and Chicago have been heavily lagging the rest of the country. Maybe an overestimation?

[Baronvonellis]

What's the difference between payroll and labor force? Your saying one is up and one is down in the metro?

[moorhosj]

Originally Posted by Baronvonellis

What's the difference between payroll and labor force? Your saying one is up and one is down in the metro?

Payrolls are a measurement of people with jobs. Labor force is a measure of people with jobs or looking for jobs. The difference between them is the unemployment rate.

The data is showing that we have more people employed in the metro area this year, but the total labor force (those working plus those looking for work) is actually smaller. This is how the unemployment rate has dropped so far so fast.

Two possible answers: A bunch of people stopped even looking for work and are out of the workforce altogether. Or a bunch of people who were looking for jobs last year (but not employed) moved somewhere else. In reality, its a combination of people getting jobs, people quitting their search and people moving.

[marothisu]

I posted some of these numbers a few weeks ago as the MD numbers for Chicago are released with the state numbers which are always a few weeks before the MSA release.

For the city, the unemployment rate is now 3.6%. The total number of employed people in the city is 4000 below May 2017, but over 8000 more than May 2015. NYC is at 3.4% unemployment with a decrease in labor force by over 20k people since a year previous.

San Francisco: 2.1%
Nashville: 2.2%
Minneapolis: 2.3%
San Jose: 2.3%
Denver: 2.4%
Austin: 2.6%
Seattle: 3.0%
Boston: 3.1%
Portland: 3.1%
Indianapolis: 3.3%
NYC: 3.4%
Columbus: 3.5%
Dallas: 3.5%
Phoenix: 3.5%
Chicago: 3.6%
Charlotte: 3.6%
Milwaukee: 3.6%
St. Louis: 3.8%
Atlanta: 3.9%
Kansas City: 3.9%
Miami: 3.9%
Houston: 4.1%
Los Angeles: 4.1%
Memphis: 4.1%
Las Vegas: 4.6%
Philadelphia: 5.0%
DC: 5.2%
Baltimore: 5.6%
Cleveland: 6.4%
Detroit: 7.9%

[glowrock]

Originally Posted by marothisu

I posted some of these numbers a few weeks ago as the MD numbers for Chicago are released with the state numbers which are always a few weeks before the MSA release.

For the city, the unemployment rate is now 3.6%. The total number of employed people in the city is 4000 below May 2017, but over 8000 more than May 2015. NYC is at 3.4% unemployment with a decrease in labor force by over 20k people since a year previous.

San Francisco: 2.1%
Nashville: 2.2%
Minneapolis: 2.3%
San Jose: 2.3%
Denver: 2.4%
Austin: 2.6%
Seattle: 3.0%
Boston: 3.1%
Portland: 3.1%
Indianapolis: 3.3%
NYC: 3.4%
Columbus: 3.5%
Dallas: 3.5%
Phoenix: 3.5%
Chicago: 3.6%
Charlotte: 3.6%
Milwaukee: 3.6%
St. Louis: 3.8%
Atlanta: 3.9%
Kansas City: 3.9%
Miami: 3.9%
Houston: 4.1%
Los Angeles: 4.1%
Memphis: 4.1%
Las Vegas: 4.6%
Philadelphia: 5.0%
DC: 5.2%
Baltimore: 5.6%
Cleveland: 6.4%
Detroit: 7.9%

I hate to say it, but these numbers all seem INCREDIBLY low. Ridiculously low, in fact! Given not only my own personal experience, but that of a large number of people I know (nearly all of which are professional, college educated people with very solid skillsets!), I'd venture a very educated guess that these figures are highly influenced by people taking part-time positions or other positions far below their prior pay grade/professional level. Something is very much amiss here, as if the unemployment rates were truly this low, we'd have wage inflation like nobody's business. And frankly, unless you're in one of a very few chosen professions/industries, that's simply not happening.

Aaron (Glowrock)