Transcript
Speaker: As middle market companies grow, they often struggle to find the talent they need and often wrestle with local infrastructure that makes it hard to grow. Sometimes they feel alone in those struggles. But a Chamber of Commerce or other business association can make a big difference. And in this episode of The Market That Moves America, we'll learn how the Chicagoland Chamber is putting its muscle to work to help middle market companies thrive in the Windy City.
Speaker: Welcome to The Market That Moves America, a podcast from the National Center for the Middle Market, which will educate you about the challenges facing mid -sized companies and help you take advantage of new opportunities.
Speaker: Today, on the market that moves America, we'll learn about the performance, the prospects, the challenges, and the opportunities of middle market companies in this great city of Chicago. I'm Tom Stewart. I'm the executive director of the National Center for the Middle Market at the Ohio State University Fisher College of Business. I'm here with Doug Ferren, the center's managing director.
Speaker: We are the nation's leading research center studying mid -sized companies, which account for a third of private sector employment in GDP and the lion's share of economic growth. It truly is the market that moves America. The National Center for the Middle Market is a partnership between Ohio State and CHUB.
Speaker: And with us today is a special guest. I'd like to welcome Jack Lavin. Jack is the president and CEO of the Chicagoland Chamber of Commerce. He oversees all the Chamber's activity, which includes a program now entering his fifth year that focuses on middle market companies in the windy city. Jack, welcome to the Market That Moves America. Tom, thanks for having me. Tom and Doug, glad to be here.
Speaker: We're talking to Jack in early March, 2020. In a couple of weeks, Doug and I will be in Chicago for the Chamber's annual Mid -Market Chicago event held March 19th at Collier's International. The middle market in Chicago is enormously important, nearly 2 million employees, nearly $400 billion in annual revenue. Jack, as you've been preparing for the event, and as you look around at Chicago's middle market companies,
Speaker: How's business? I mean, what's the overall performance? What's the overall feeling?
Speaker: Yeah, the business is good. And clearly, the mid -market is kind of the backbone of our economy here. A lot of unsung heroes that are employing, as you said, 25 % of our region's employers and almost 2 million employees. So things are going well. The central business district here in Chicago is doing well. And there's been an increased push to have some of that growth, which has been tremendous.
Speaker: to go out into the neighborhoods and that's where a lot of our middle market companies are tend to be and we need to work to help them grow and I think some of the information that we'll have from the middle market survey will help us look at some of the areas that we need to work with our companies to help them grow. Infrastructure and talent are two key areas
Speaker: But our middle market companies, they tend to be a little more down to earth and look at things a little more even -handedly. But I think the Chicago market is doing well. We've had a number of tech companies start growing here. We've had some good announcements with
Speaker: One thing, our Discovery Partners Institute, which is a collaboration of our higher education and trying to connect them up with businesses. And we want to, as a chamber, not just have the big businesses but have our middle market companies who need talent, who need research and development to be connected.
Speaker: with something like the Discovery Partners Institute, which is the University of Illinois and a number of other higher ed schools trying to bring talent through academics and students and graduate students and connect them with companies up here. So a lot of good things are happening here in Chicago, a lot of excitement about the growth that's happening.
Speaker: Let me pick up on that just a bit, Jack. One of the things that we looked at in some work that we did with Brookings and then some work that we actually did with the World Business Forum in Chicago, I think that was the name, was looking at the disconnection between the talent needs of middle market companies, which are really fast growing.
Speaker: and the workforce system of colleges and community colleges that the bridge didn't meet very well. And it sounds to me like you're doing work to close that, to help the growing mid -sized companies connect with those groups that are producing and developing talent. Yeah, we're definitely trying to connect. We have some programs we're already doing.
Speaker: We have a grant from the Illinois Department of Commerce and Economic Opportunity to train our workers and a lot of middle market companies are taking advantage of that and our grant pays for 50 % of the cost, which is a big benefit for companies and our members. We're also lining up an apprenticeship program.
Speaker: There's a Chicago apprenticeship network in Chicago, but it's a lot of the big companies. Aeon Chase, we love them. They're members. But we need to make sure that our middle market companies are finding the talent pipelines. And so we're soon going to launch a mid -market apprenticeship program. And once again, our grant from the state will pay for half the cost of the apprentice. So once again, we're trying to help our middle market companies that don't have big HR departments,
Speaker: like companies like Aon and Chase Bank, but they need the talent. They need to find that talent. They need to find new pipelines of talent, and particularly for diverse pipelines of talent. And so we're just launching this. We're the first ones doing it. It'll be a multi -company apprenticeship program, which is the first time it'll be done in Chicago. And so we're very excited about it. It's all about connecting talent. And that was the other thing I just mentioned, the Discovery Partners Institute.
Speaker: We have great higher ed in Chicago, in the Midwest, every Big Ten, no offense, Ohio State, but every Big Ten school, a lot of times there's graduates want to come to Chicago.
Speaker: One of our interns is happily employed and very successfully employed in Chicago right now. We love coming up to see her and demonstrating that her Ohio State education made her a superior member of the Chicago workforce. We are the hub of the Midwest. But the point is, no matter what Big Ten school you are, and obviously the University of Illinois is our flagship school here,
Speaker: They're all away from the urban areas and Ohio states and Columbus, but like you, it's two and a half hours away. How are we taking the student talent, the graduate students, the academics and the research being done and connect them with companies.
Speaker: And a lot of big companies, they go down to U of I and they recruit and they have ways, but the middle market companies don't always do that. And we need to find more ways to connect the talent and the research all that's being done, whether it's University of Illinois or other big 10 schools, connect them up with companies because if we can do that.
Speaker: There's a stickiness that's created, and that stickiness attracts talent and keeps talent here. We need to find more ways to do that with our middle market companies because they do need talent. They don't always have big recruiting budgets or recruiting staff, and we need to find more ways to do that. We're trying to do that through our job training, our apprenticeships, and finding new partnerships with higher education, particularly with
Speaker: the University of Illinois and this Discovery Partners Institute. Yeah, Jack, let me just ask you another follow up on that. As you know, every year we pull together data across the country and then specifically about Chicago's middle market as summarized in the report that we'll share here soon. This year, companies similar to last year, they're telling us that talent does continue to be the number one challenge and you just walk through
Speaker: I think a couple of great examples of things that you're doing to help support them. But what are some of the other things that your members are saying they face in terms of the attraction and retention of their people? Yeah, I mean, there's a number of things. One is what are what's the amenities you're offering, whether it's salary, benefits, workplace.
Speaker: It's interesting, we've had a number of programs on this and one of them at Collier's, which where we'll be for the mid -market survey in a few weeks.
Speaker: But, you know, different things come up that are that employees want salaries are important, but also flexible scheduling working from home. Things in the workplace air quality natural light temperature other amenities. So all these things are part of attracting talent and retaining talent.
Speaker: And I think a lot of our middle market companies, we're trying to do programming, whether it's through our mid -market Chicago program, our tech council, healthcare council, all about these things that help attract and retain talent. So all our programming has a talent aspect to it during the year to help our middle market companies address these issues. They often know it's an issue, but they don't know how to go after it and deal with it.
Speaker: Um, and so whether it's talent pipelines and attracting talent or amenities at work, I mean, all these things are things that we're working with our members because they're asking us, how do we do this and what do we do? And so we're, we're working with them on these different, different areas in these different areas. Yeah. Let me pick on maybe a pick up a slightly different topic, but one you mentioned earlier, and that's infrastructure.
Speaker: So traditionally you would think of highways, roads, bridges, airports. What does that mean? And maybe how does it link to some of the issues you just mentioned about talent in terms of office space, amenities, technology, public transportation? Can you expand on the infrastructure piece a little bit for us? Yeah, that's a great question. And we this past spring in our legislative session and for our state government,
Speaker: We were out there leading the charge for a capital infrastructure bill, particularly for mass transit. When we talk to our companies of what's important for him talent is number one, but infrastructure is number two, particularly mass transit in our airports.
Speaker: And we're in the process of having an $8 .5 billion investment in modernizing our airport. But we also needed to make sure we had sustainable funding, not just a one -time growth, but sustainable revenue for mass transit to continue to invest in it. I mean, mobility means opportunity. And there's certain criteria about how long your commute is and all those kinds of things that are important to employers and employees.
Speaker: A lot of millennials and younger talent that's coming to urban areas want to have that mass transit. So we have been fighting as a chamber to invest in that infrastructure, whether it's our airports or a mass transit, to make sure that that's there to help our employees and our employers have workers get to and from work and then be able to have workers travel anywhere in the country of the world through our
Speaker: through O 'Hare midway and O 'Hare is a dual hub system. We have two major airlines, which is unusual for a lot of cities, but that is a benefit to Chicago. So these infrastructure issues are very important to our companies growing
Speaker: and to the optimism that our companies have when they're thinking about revenue growth and hiring people, hiring new employees. So infrastructure, talent are two of the key items as we go forward, and they're particularly important for our middle market companies.
Speaker: Jack, let me broaden the lens. I love this discussion of talent and infrastructure and also your comment that mobility is opportunity, which is something that we've seen in conversations with other cities and some of the work that we've done.
Speaker: It's one thing to have a job. It's another thing to be able to get to the job and to connect those things. But if you look at if you look at Chicagoland and as the data that we have show, Chicagoland in particular in the Midwest broadly is slightly underperforming the middle market as a whole in the U .S.
Speaker: And if you look at expressions of confidence in the local economy, the national economy, and the global economy, and Chicagoland is one of those exceptions where you find confidence in the local economy,
Speaker: a little bit lower than confidence in the national economy. Part of this, of course, is issues in Springfield and with the governance of Illinois, which are long -going and everybody's been beating their head against the wall about it. But I also wonder whether, if you look at the larger picture about
Speaker: trade about Chicago's role as a transportation hub and as a manufacturing center. Chicago and more than most places has a real dog in the hunt in terms of trade and trade policy. Do you find that middle market companies are struggling with some of these issues?
Speaker: I think that your question is a great question and I've been doing the economic development here for these almost 20 years. I think there's a number of areas first on tech and technology. I think our, you know, some people don't see us as a tech center and we are a tech center. We've done, made a lot of investments over the last decade to increase the tech talent we have.
Speaker: But I think part of what you're saying is a perception and people look at Chicago and have perceptions and then once they come here and see what we have here, I think they love it. And so part of it is we need to make sure to get the word out that people understand all the assets that we have here in Chicago, the tech talent we have and the tech infrastructure we're building.
Speaker: As you mentioned the infrastructure, as you mentioned the transportation infrastructure which should help us attract international companies and for trade. So I think a large part of it is the perception and we need to do a better job of marketing and communicating what we have here. And then you mentioned something that I do think pervades conversation as some of our issues in government and
Speaker: and the fiscal stability, which businesses love fiscal stability. And we need to do more on property tax reform. We need to do more on pension reform. And we need to get the word out there that we're doing things so that people understand that those things are being addressed. And that's really important for us to attract and retain businesses. So much of what happens in an economy and when you look at the survey in the last couple of years and what's upcoming
Speaker: It's a lot about perceptions. And we have great assets here in Chicago, in Chicagoland. But if there's this perception that things are going a certain way, that can become a self -fulfilling prophecy. And we need to make sure we address those issues, communicate the good things that are here and the assets we have here, and move forward. And I think if we do that,
Speaker: The confidence will grow and will have a little bit less of the pessimism, although I also think.
Speaker: in Chicago and in the Midwest in general, we tend to be a little more pragmatic and even keeled and not have the ups and downs of the volatility of the high competence, low competence. We tend to be a little more even keeled on things. And I think you see that in the survey. But we have great assets here. And from a global trading and global economy, I think we're going to grow. And in large part, it's because the quality of life we have here, the affordability we have here,
Speaker: and then add the assets of our airports and our other transportation infrastructure. And I think the future is bright because of all those things for Chicagoland.
Speaker: met and talked with a number of chambers across the country, major metros and so forth. And a lot of them are just starting to recognize the significance of the middle market and exactly what it means to their own local economies and communities.
Speaker: Chicago Land is a few years ahead of that through the work that you've been doing. How do you see positioning the chamber? Is it as a resource, as a voice to the many issues? A lot of them that you just mentioned, is it a convening arm? I mean, how would you like to see the chamber positioned to help middle market companies in Chicago Land?
Speaker: Yeah, great question. I think it's all the above. I think we have to be a resource and a convener on what's available here in the market for companies, whether it's job training, apprenticeships, making those connections with our higher education institutions to connect student talent, graduate talent, academic talent, all those things we need to do because the middle market companies don't have
Speaker: the staff at the corporate level to do that. And they don't always, their heads are down and they're plowing forward and they got to look up and the chamber is a resource. And I think middle market companies are seeing that. And then the other area I think you mentioned is advocacy. And we do provide that and we're unique in the state, certainly, because we provide advocacy at our state capital, our city hall, our county government,
Speaker: Because once again, a lot of our middle market companies just have their heads down and they're trying to move forward and they don't want government to interfere with what they're doing. But the fact of the matter is government does interfere and government does put things out there. And so they need a voice for them out there fighting for pro growth, pro job policies. And we do have the politics in our country right now and in Chicago is about
Speaker: business has a lot of money, business can afford this, business can pay more and more regulations on business. And we've had that in Chicago and in Illinois, but we also need to make sure that people realize who creates jobs, it's companies. And in Illinois and in Chicago, the middle market is providing 2 million jobs and 25 % of our companies. And we need to realize that and these companies are not
Speaker: the rich companies or they're not, whatever, they're just doing their job and moving forward. And so they need a voice. And so that's what we're providing. Convener, a resource, but also an advocate for the middle market companies to help them have an atmosphere and environment to grow.
Speaker: So Jack, thank you. And let me try to wrap this up because I think there are a couple of really great things in this conversation. I think one of the things that you've said a couple of times is certainly in our experience is that middle market companies often have big company problems without big company resources. And when it comes to attracting talent, they can't grow their own as easily and they can't necessarily recruit with big famous brand names as easily as large companies can.
Speaker: Another has to do with infrastructure, and in a sense, middle market companies are more dependent on public investment in infrastructure than large companies might be. They can't make their own weather to the degree that large companies can. And so in those areas, the Chamber and public -private partnerships and all kinds of things can make important
Speaker: it can really make important contributions that help produce the talent and create the circumstances where companies can be more efficient and not be sort of trip over unnecessary obstacles that are put in their way. So I'm really excited to hear about the stuff that the Chamber's doing, particularly that workforce stuff, which is, as you said, is unique and new.
Speaker: And so I think what I'm taking from this is the value of a chamber that recognizes the unique place of middle market companies, some of those unique challenges and sort of says, let's try to address those with some specific programs that are tailored to the size of that body and not just off the shelf and sort of not quite exactly fitting. Is that a pretty good summary of which of the way you're thinking?
Speaker: Yeah, absolutely. And I think you said it right. And I think it's also the trend of our younger generations looking for jobs. They view the market differently. They're not all saying, oh, I just want to go to the company with the big name and big reputation. I want to go to the company that provides the benefits and the workplace environment and flexible scheduling.
Speaker: that I want as part of my quality of life. And so we need to help the middle market companies see that. And we also can help the middle market companies connect up with talent that wants to see that. I mean, a few years ago, the state had a program that connected graduate students, graduate engineering students at the University of Illinois with middle market companies. And so these graduates might have a perception, oh, I got to go work for
Speaker: you know, some big company out in Silicon Valley, and then they find out, hey, there's a company right in our backyard. It's a middle market company. It's a great work environment. I really enjoyed working with the people there. I'm going to stay there. There becomes a stickiness.
Speaker: when you're able to do that. And I think that's where some of our programming and what we're doing in this survey and what comes out of it can help our middle market companies be able to grow and help connect talent with middle market companies in a new way that our talent is looking for companies to be part of for their future.
Speaker: Thank you. And with that, let me thank, and Doug, join me in thanking Jack Lavin, who is the president and CEO of the Chicagoland Chamber of Commerce. For more about them, check out their website. It's the Chicagoland Chamber of Commerce, and you can find it on Google, and you can learn about the middle market event in the middle of March 2020, or March 19th, 2020, if you're listening to this podcast before that.
Speaker: If you are listening after, check out their website anyway and learn more about the good work they're doing on behalf of mid -sized companies in Chicago. And we'd like to thank you all for listening to The Market That Moves America. Never miss a new episode. You can subscribe to the podcast on iTunes, Stitcher, Google Play, or wherever fine podcasts can be found. Or you can subscribe to it and learn more about us, about the National Center for the Middle Market, at our website, which is Middle Market Center,
Speaker: dot org.
