(The Center Square) – A study by Simplify LLC highlights the stagnant state of business growth in Illinois, a problem an industry analyst hopes less burdensome regulations may solve.
The study ranks Illinois the 12th most expensive state in which to launch a business, with Minnesota being the costliest. Based on census and other data, the Simplify report put the net rate of business births in Illinois at less than 1 for 2021.
“I think it’s certainly becoming clear that Illinois is not growing, that businesses are not expanding and locating in Illinois,” Chris Davis, Illinois state director of the National Federation of Independent Business, told The Center Square. “I think the census data is proving that Illinois is losing workers and losing residents and losing taxpayers.”
At the same time, Davis did not think the study painted a complete picture of the challenges facing new business owners. He said expanded regulations and costs like workers’ compensation insurance as well as legal liabilities, health insurance and property taxes are primary burdens for Illinois businesses. And they are not exempt from the pressures of inflation, low labor participation rates and supply chain issues seen nationwide, he said.
Conversely, the study by how-to guide company Simplify focused on corporate income tax, wages, electric bills and more, based on analyzing data from the Census Bureau, Small Business Administration and Bureau of Labor Statistics.
Over the past few decades, Illinois has regressed from being a top 10 state to launch a business in to its low-growth status today, Davis said, adding “I don’t think this is something that happens overnight.”
Yet he holds hope that Illinois can regain solid footing if policymakers “take a hard look at the way they’re regulating and burdening business owners in the state of Illinois,” realizing that startups have a choice to go elsewhere.
He called for collaboration between policymakers and entrepreneurs to turn the tide in favor of local commerce.
“Illinois still has the resources to be a great place to do business. We just need to collaborate a little more with business owners and policymakers to put us on the right path.”
Chicago stands out as an example of a city still struggling to recover after the “mass exodus” of businesses during the COVID-19 pandemic, he said.
“It’s going to take some collaboration and foresight, I think, to see Chicago grow the way it should,” Davis said.