One year after the pandemic severely affected the regional economy, northeastern Illinois is showing signs of recovery but continues to lag behind national trends. A delayed recovery would magnify the slow growth and inequities that had been happening in the region before the pandemic began.
A recent analysis from the Chicago Metropolitan Agency for Planning (CMAP) found the region has regained 43 percent of the jobs lost in 2020, but the rebound has slowed since the holiday season. Unemployment is highest among Black, Hispanic, and younger workers, while one in three small businesses throughout Illinois remain closed.
Coast to coast, major metropolitan areas initially grappled with widespread unemployment as they usually were the first to experience coronavirus outbreaks and dramatic drops in consumer spending. Northeastern Illinois, in particular, reached its worst unemployment level (17.2 percent) in April 2020 — about a month after many businesses, schools, and workplaces started taking steps to contain the spread of the virus.
The region has recovered since then, with unemployment at 8.9 percent in January 2021. Still, northeastern Illinois continues to lag behind peer metropolitan areas. Other major regional economies, such as Houston (8.3 percent) and Boston (6.8 percent), have lower unemployment rates.
Lower unemployment figures can obscure the number of people who are out of work. Many employees have had to leave their jobs to care for children while at home or accept furloughs and early retirements. About 137,000 fewer residents (3.2 percent) in northeastern Illinois were working or looking for work in January 2021, compared to the same time last year.
Although monthly local employment estimates generally are not available by gender, race/ethnicity, or disability status, preliminary annual averages for 2020 show unemployment is highest among workers who are between 20 and 24 years old, Black, and Hispanic. These data reiterate the need for an equitable recovery to reverse longstanding issues and ensure a better regional economy.
For small businesses, some are struggling while others feel more confident about recovering. One in three small businesses in Illinois remained closed as of early February 2021, but about one in five small businesses in the region recently reported operating at their normal, pre-pandemic levels. Nearly half (47.9 percent) of small businesses in northeastern Illinois said in a recent U.S. Census Bureau survey they would need more than six months to recover.
ON TO 2050, the region’s long-range plan, emphasizes the need for inclusive growth that reduces inequities and strengthens our resilience in the face of future downturns. Moving forward, federal funds from the CARES Act and American Rescue Plan will provide Illinois and local governments with resources to support industries, workers, and disinvested communities.
CMAP also will continue to support our government partners as the region looks to recover stronger. We are convening regional stakeholders to develop solutions related to economy and mobility that can better prepare northeastern Illinois for a post-COVID recovery. Through our Local Technical Assistance program and other initiatives, CMAP is helping communities with high needs plan for reinvestment. By working together, we can help restart growth throughout the region and create opportunities for people and communities that long have experienced disinvestment.