A new study shows that 52,404 new jobs came to downtown Chicago between 2002 and 2011 thanks to economic development investments, yet only one in four of those positions went to city residents.
Suburbanites and people in prosperous Chicago communities like Lakeview and Lincoln Park mostly gained those jobs, and residents in the city's predominantly black and Latino neighborhoods were largely excluded, the report issued Tuesday by Grassroots Collaborative found.
From 2004 to 2008, the city spent more than $1.2 billion in public, tax increment financing (TIF) funds for these type of downtown, job creation investments, according to the report called, “Downtown Prosperity, Neighborhood Neglect: Chicago’s Black and Latino Workers Left Behind.”
"This type of development creates disparities clearly along racial lines, and the city should not be endorsing policies that shift more money to a smaller group of the city," said Eric Tellez, research and data manager with Grassroots Collaborative, a coalition of community and labor groups. "For all of the city to do well, all of its residents need to do well. Prioritizing downtown development to the exclusion of neighborhoods is an economic development strategy that is failing most people in the city."
In the decade ending in 2011, Chicago's white majority zip codes each added a median of 509 downtown jobs, while black majority zip codes each experienced a median loss of 620 downtown jobs within the same time period. Latino majority zip codes had a median loss of 381 downtown jobs, the study showed.
During this time period, Chicago's blighted Englewood community had the largest loss of downtown jobs, 800 positions, yet suburban Naperville residents landed more than 800 positions in the heart of the Windy City.
From 2002 to 2011, the city added 129,054 new jobs that paid annual salaries of at least $40,000, yet it lost 182,938 jobs that paid less than that figure. During this time period, Chicago's neighborhoods lost a total of 10,121 jobs.
Meanwhile, unemployment also grew disproportionately in communities of color, the report showed. The city's top ten zip codes with the highest unemployment rates from 2007 to 2011 were at least 70 percent black or Latino, according to Census data estimates.
"For struggling black and brown neighborhoods, Chicago is cutting jobs and depressing the local economy, but for suburban, wealthy and white neighborhoods, the city is bringing jobs that are higher paying than the original base that was here," said Amisha Patel, executive director of the Grassroots Collaborative. "We're spending billions of dollars subsidizing corporations and infrastructure downtown, yet the benefits of that subsidy, of that investment is not going to our neighborhoods."
The report recommends several steps the city could take as a means to reinvest in struggling neighborhoods. First, Chicago officials should take funds from downtown TIF districts and port the money back into truly blighted neighborhoods.
Also, a commuter tax could be implemented to help "ease the burden on Chicago-resident taxpayers, for whom the benefits of downtown job growth have been disproportionately small."
Additionally, the mayor and the city council should increase Chicago's minimum wage and also create living-wage requirements for all city subsidy programs. The report also called on city officials to set up a "fixed formula" for declaring a surplus in prosperous TIF districts that would return a specific amount of money to the local units of government.
At the state level, the report recommends amending Illinois' constitution to allow for a graduated income tax.
Next week, the Grassroots Collaborative and other community organizers plan to launch an "economic justice agenda" for the city and further strategize around the report's recommendations at a "Take Back Chicago" public town hall meeting scheduled for October 15. Check back with Progress Illinois for our coverage of the event.