Northwest Business Magazine

Business Outlook 2015

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Things are looking up, and local communities are positioning themselves to make the most of it. Check in with chamber of commerce leaders from seven cities to see what they expect from the new year ahead.

Things are looking up, and local communities are positioning themselves to make the most of it. Here, we check in with chamber of commerce leaders from seven cities in our region to see what they expect from the new year ahead.

Communities across northern Illinois and southern Wisconsin are seeing similar positive indicators – lower gas prices, declining unemployment, greater interest in business expansion. While the degree to which the municipalities are able to capitalize on these positive signs vary, one thing is clear: most local and regional business leaders are interpreting 2015 as the beginning of the end of a dark economic winter that has gripped our region for years. Most local leaders see an economic thaw on the horizon, and have their own unique plans to help citizens make the most of the upturn.

Rockford 2015 Outlook

One indicator that the 150,000 residents of Rockford have experienced tough economic times has been unemployment rates regularly above state averages. But the tide seems to be turning. In January 2014, Rockford had a 14.3 percent unemployment rate, according to the U.S. Bureau of Labor. By September, it had dropped to 9.8 percent.

The downward trend is raising expectations for 2015.

“Rockford always lags in the employment numbers, unfortunately, so we are still at a higher unemployment rate than the state average, but we’re still working our way downward and that’s good,” says Einar Forsman, Rockford Chamber of Commerce President and CEO.

Forsman says conversations with local business leaders have been very positive.

“We have a lot of things looking forward,” says Forsman. “Our education system is tracking well on getting aligned and improved. The Transform Rockford initiative is committed to improving Rockford at all levels. So, with that comes an attitude that we’re heading down the right track and businesses investing in the area feel more comfortable making those investments or investing in their people more.”

He points to the $200 million Woodward expansion, which is expected to double the local Woodward workforce, as evidence that businesses are ready to invest in the Rockford area for the long haul.

“When people in the community see that type of investment, they start thinking we’re heading in a positive direction,” Forsman says. “Sometimes you don’t know when a business adds a wing to their building or is expanding, but when you see a large building in a very prominent area, it’s very easy for everyone to see. Making that kind of commitment really sends the message that we’re building our community for the long haul, we’re making our investment now and making our community stronger.”

Woodward’s expansion underscores the fact that Rockford’s future is tied to the aerospace industry.

The Chicago Rockford International Airport remains an important driving force for economic development. It proved to be a determining factor in attracting AAR to build a state-of-the-art jet repair facility in Rockford.

“This AAR project that’s going up with the maintenance repair operation at the airport is a big deal for us. It can be a game changer by bringing a lot of good- paying jobs to people interested in getting into aviation maintenance,” Forsman says.

Forsman says Rock Valley College is expanding its Aviation Maintenance Technology program to help develop the workforce for the AAR complex, which is slated to open in 2016.

“The airport is such a big asset for us, and to have that AAR facility there is such a magnet for cargo and other operations,” Forsman says. “This facility will be able to house two 747s at the same time, which is not too common. It brings interest from other companies to either set up an alternate operation here or to expand cargo. No matter how you slice it, the airport is a key part of our future. Commercially, it’s certainly great to have destination travel out of the airport, but in terms of jobs and resources and building around our aerospace cluster, the airport is tantamount to that. For us, cargo is where the jobs and the money are.”

Forsman says the airport plays a vital role in the projections of economic upturn in 2015 for Rockford. With continued investment, he says, the sky is the limit for potential Rockford economic growth.

“Our base in aerospace is going to continue to grow,” he says. “That cluster is something that will continue to grab the attention of other companies tied to aerospace.”

Rochelle 2015 Outlook

According to Rochelle Economic Development Director Jason Anderson, the 2015 economic outlook for Rochelle is about three things: location, location, location.

“A great benefit to being in Rochelle is having direct and easy access to two Class 1 railroads,” Anderson says. “It makes us unique. Both the Union Pacific and Burlington Northern/Santa Fe railways intersect here.”

Rochelle is strategically located at the intersection of two interstate highways, also: I-39 and I-88 on the western edge of the Chicago-Metro region.

“You don’t even need to go through a stop light to get interstate access, from several industrial parks,” Anderson says.

The city-owned short-line, City of Rochelle Railroad, provides lead-track switching service of railcars to either Class 1 railroad. Anderson says the city has invested aggressively to build the road, rail and utility infrastructure to help industrial businesses succeed. This unique location helps Rochelle stand out in the logistics and shipping industry.

“Companies don’t have to ship material or items to Chicago to get them shipped to market,” Anderson says. “They can do it right here. No matter the type of shipment, we can handle anything from unit trains, manifest rail, intermodal – all right here in Rochelle.”

The prime location, coupled with a decade of investment, has Rochelle primed for a profitable year, says Anderson.

“We’re on a roll and working on a lot of new projects. We think there are a lot of positive things happening in Rochelle,” he says. “In the past 10 years, over $1.2 billion of capital investments have been made in land, buildings and equipment and those have added thousands of new jobs in many industries like trucking, manufacturing, food, technology and logistics.

We’ve had a lot of new growth, and that was during the recession. If we can accomplish those things in tough times, think what we can do when the economy gets turned around.”

The city is committed to even more growth-spurring investment in 2015 and beyond.

“We’re looking to invest $10 million in the rail system in the next few years,” Anderson says. “We have more than 2,500 acres available for development. They have water, sewer, power and fiber optic lines built, so we’re ready to go.”

While surrounding areas have dealt with turbulent times, Rochelle has remained steady and is well-prepared to take full advantage of infrastructure investments.

“We believe that ‘if you build it (infrastructure) they will come.’ We have the infrastructure, so we’re ready,” Anderson says. “We have it built and we have plans to expand it. And now we’re working on the funding to extend even further. When business comes knocking on the door, you have to capitalize on it. We’ve spent the past 10 years building to get ready and we expect growth at an even greater rate than we’ve been growing the past 10 years.”

With its unique location and commitment to infrastructure investment, Rochelle appears to be on the right track in 2015.

Dixon 2015 Outlook

State elections often have local consequences, and one consequence of Bruce Rauner’s victory over incumbent Pat Quinn in the Illinois governor’s race this past November was to toss the statewide program for growing and dispensing medical marijuana into limbo. Therefore, 2015 began with uncertainty for a number of Dixon and Lee County-based organizations that had submitted applications to take part in the statewide program.

“Unfortunately, everyone associated with the program thought the decision was going to come before Quinn left office,” says Dixon Chamber of Commerce & CEO John Thompson. Quinn, however, left office without addressing the issue. “We need to see what the new governor is going to do. It’s a little difficult to know what’s going to come out of that.”

Thompson says there are “six or so” applications related to cultivation centers in the Lee County area and one for a dispensary located in Dixon. If the applications are approved, it could have a significant impact on the local economy.

“If the dispensary comes, they’ll construct a significant building and bring in dozens of good jobs,” Thompson says.
“Security provisions and vetting of employees will make sure they’re jobs for stellar individuals. The dispensary will bring good jobs for good pay for good folks.”

Thompson says his research into comparable areas that have embraced the burgeoning medical marijuana cultivation and dispensing market has shown that it brings positive economic benefits to a community.

“Based on all of the projections, this will be a significant boost to the economy,” he says, and the state, county and local government will benefit from increased tax revenue.

Thompson is cautiously confident about 2015.

“We’re pretty optimistic about our economy in general, and Dixon is doing well,” he says. “Hopefully, we’ll see positive movement toward enhancing our economy when some of these issues are resolved.”

Without a decision early in 2015, an important piece of Dixon’s economic projections for the new year could go up in smoke.

Galena 2015 Outlook

Galena’s economy is dependent upon tourism. Golf courses, resorts and attractions dot the area. Galena is the largest community in Jo Daviess County and a haven for history lovers, artists, foodies, wine enthusiasts and shoppers.

People from throughout the Tri-State area find rest and relaxation here. Chris Hamilton, President & CEO of VisitGalena.org, senses that people across the region and state are feeling a slow but steady economic reawakening, which bodes well for the Galena area.

“People are getting more comfortable with job security, their financial status and the economy in general,” Hamilton says. “This is inspiring them to investigate business opportunities and reward themselves with travel and vacations that they might have cut out during the recession. Essentially, people are slowly getting comfortable with spending money again.”

Hamilton says lower gas prices help to fuel the Galena economy, too.

“If fuel prices remain as low as they’ve been, or even close to it, people are more likely to travel. Costs for goods and services should level off, if not decrease, and a positive flow of money should be noticeable because of it. People will simply have more purchasing power.”

Based on national and regional trends, Hamilton expects 2015 to be a year of growth.

“I expect to see another increase in visitor traffic and general interest in the Greater Galena area overall,” he says.

Efforts by local business and civic organizations are being coordinated in order to capitalize on the economic turnaround in 2015.

“There’s a continuous effort to strengthen the area’s appeal to consumers and businesses by nurturing a regional mentality, and it should have a noticeable impact on the attention paid to Galena, Jo Daviess County and the Tri-State area,” Hamilton says. Strengthening the relationships and finding ways to work together will benefit all.

“That might sound like a cliche, but we’re making an effort to know more about our neighbors so we can find common denominators and score victories as a team. We believe this will allow us to be successful more often. This seems to be a trend with other leaders and organizations in our area.”

This coordinated effort, coupled with a general economic thaw across the region, could help to drive more people to Galena with money in their wallets to spend in fun ways during 2015.

Beloit 2015 Outlook

Beloit enters 2015 with exuberant expectations for the kind of economic growth it experienced last year. Greater Beloit Chamber of Commerce Executive Director Tim Dutter says no matter the industry, existing companies are growing.

“In the service industry, Statewide Collections has already had to add space twice in less than a year,” Dutter says.
“Acculynx and Comply 365 are adding jobs in the information technology sector. Our manufacturing companies are growing and expanding, too, with Stainless Tank and Equipment, Axium Foods and Kerry Ingredients leading the way.”

Dutter views this as a trend that will continue.

“We’re incredibly optimistic about 2015 for business development in the greater Beloit region, and I have no doubt that we’ll see more expansions from companies in our region, which will account for more than 80 percent of our business growth,” he says. “Some are adding numbers to their employee count, others need more space to produce their product, and some are growing so fast that they need to annex or create additional space to accommodate their growing workforces.”

The burgeoning business climate is also inspiring new business owners to spread their wings in downtown Beloit, where the vacancy rate is less than 5 percent.

“Much of the space has been filled up by our entrepreneurs,” Dutter says. “The Flying Pig opened downtown last year, and the space at the Phoenix Building has been locked down. WM Day Spa and the Grand Avenue Pub opened their doors in 2014.

Small businesses are the driving force of our economy, and in 2015, we’ll see more of them opening their doors. Juicy Veggie and Lucy’s No. 7, a burger bar, already have plans to open their doors within the next few months. Smaller retail shops are beginning to follow the buzz.”

On the state and local level, organizations are doing everything they can to spur economic growth, which may even impact neighbors to the south, says Dutter.

“Beloit’s Downtown Business Association does a phenomenal job of gathering data, incentives and access to loan programs, to assist entrepreneurs in making their businesses a reality in downtown Beloit,” he says. “Gateway Business Park continues to grow, too. The EDC and the city have really stepped up to the plate to collaborate and land some great primary employers, like Northstar, Chicago Fittings and Pratt Industries. Success breeds success, and I’d expect to see more companies in Illinois starting to take another look at Wisconsin for their headquarters. It’ll be interesting to see what Gov. Rauner does in that state to improve the business environment. With Wisconsin’s pro-business leaders in government, we’re on the right path to becoming one of the most business-friendly states in the Midwest.”

Dutter says city and chamber staff members work hard to support Beloit’s upward trend.

“We’re going to give our members everything we’ve got in 2015,” he says. “We’ll either succeed with great triumph or we’ll drop dead from exhaustion while trying. I’m betting on the former.”

Freeport 2015 Outlook

Freeport is on the road to economic recovery after the closure of one of its largest employers in 2014. Kim Grimes of the Freeport Chamber of Commerce is cautiously optimistic.

“Jobs are a concern, especially after the closure of the MetLife office that affected around 400 employees,” he says. “Many were transitioned to work at their home, some transferred to other MetLife offices and the remaining into the job market.

But we still have some of our largest employers, like Freeport Health Network, Freeport School District, Titan Tire and Danfoss. Hopefully they can hold tight and not have a loss of employees. It’s important to the community to keep the larger employers going strong.”

Improving the jobs numbers is a priority, says Grimes.

“How 2015 is going to play out is still up in the air,” he says. “Unemployment is still higher than the state average, but it’s getting better. We have several new businesses that opened up this year in our historic downtown, and we have fewer open storefronts downtown and throughout the city.”

Freeport residents hold the power of economic improvement.

“We hope those living and working in Freeport support local business and help the area, meaning it’s more crucial now than ever before to shop local and keep that sales tax in the Freeport area,” Grimes says. “More than ever, local shopping is critical to the future.”

Even more importantly, citizens will play a key role in determining who will lay the groundwork for economic recovery, when local elections are held on April 7.

“We’re entering a very important time, in early April, with all eight city council seats and four of the seven school board seats being voted on,” Grimes says. He’s pleased to see challengers for most of the races. “The chamber’s feeling is that it’s good to have multiple people running for these seats. You always want more people. We can’t keep doing what we’ve been doing for years and expect things to change. We can’t keep kicking the same can down the street, so it’s good to have new people running.”

The heavily contested election will prove to be a benefit for Freeport’s economic prospects in 2015 no matter who wins, says Grimes, since the incumbents will either work harder to get the city back on track or be replaced by new faces with new ideas.

Monroe 2015 Outlook

No contractor would start construction on a building without a blueprint, so how can a city like Monroe, Wis., grow a local economy without first crafting a plan?

“Businesses like stability, and stability comes from knowing where you’re going,” says Mike Johnson, Executive Director of Green County Development Corporation, which has helped county seat Monroe and the surrounding area to develop a growth plan. “When there’s no plan, if you’re a business, are you going to want to invest? If you have a plan, it shows everybody that you have your act together. We are working on a vision for what we want to do and where we want to have growth.”

But along with the plan is another important – and some say unique – ingredient for Monroe’s economic prosperity. While cities like Rockford and Rochelle have assets like an airport or railway intersection, Monroe has an advantage that’s a little less tangible, says Johnson.

“We try to figure out where we can identify our competitive edge,” Johnson says. “All too often, we focus on only one aspect of a city – great highway access or something unique about the infrastructure – but you have to have the whole concept in mind, rather than just focusing on one thing. It’s about having everything clearly identified and laid out. Once we complete Monroe’s clearly defined plan, we couple that with an efficient approval process.”

In many cities, businesses that want to grow or launch often encounter hurdles and red tape. But not in Monroe.

“We make it easy for businesses to grow,” Johnson says. “Business owners like to know the steps to approval, as they move through the process, and they like it to be easy to understand. It’s a pretty simple concept, but many places make it harder than it has to be.”

With a planning initiative currently underway for easy business development, along with a few positive key indicators – low unemployment, low fuel costs, and a 10 percent spike in inquiries from prospects looking to expand or relocate – Johnson has positive expectations for 2015.

“A lot of companies wanted to wait and see how the last quarter of 2014 looked, so as those are being released, people are becoming more positive,” he says. “Our economy will grow steadily, a little better this year than in 2014, and that pretty much sums up Monroe and Green County.”

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