Results tagged “economicdownturn”

The national debate over health care reform has dragged on for so long, across so many different proposals, that it's hard to keep track of what the Senate or the House might be considering this week. But here in Chicago, the very real cost associated with covering employees is manifesting itself in very direct ways. Unite Here Local 1, the union that represents hotel and hospitality workers in the city is in negotiations over the labor agreement that will cover 6,000 workers downtown, and 15,000 workers in the area. And while the contract expired in August, both the union and the hotels around town are still far from an agreement. Like they did three years ago, the union is negotiating with the major hotel chains separately this year, starting with Hyatt. Unlike in 2006, when Unite Here was able to make gains on the wage increases they bargained in 2003, employers are pushing for concessions this time, due in part to the recession. "Things have gotten really bad," Unite Here Local 1 spokeswoman Annemarie Strassel told the Tribune. "I think that employers see the bad economy as an opportunity to ram through proposals." Hyatt's proposal would leave half of their unionized employees ineligible for health insurance.

Now that Mayor Daley is firmly back on Chicago soil, he's staring down not only a dangerously low popularity rating, but also a city that's on the verge of economic disaster. Impending budget holes, (yet another) CTA Doomsday scenario, unemployment and of course the on going parking meter fiasco. Before any of these crisis, individually or in total, do him in, Mayor Daley is trying his darnedest to to some serious spin. He's already insisted he won't raise property taxes to close the budget gap, likely taking reserve funds to help him do that.

In an ongoing effort to control costs and contain the city budget, the Chicago Public Library system is working on a plan to reduce hours at 76 branches this winter. The cuts will reduce the hours that libraries are open, Monday through Thursday, but will not impact the three main libraries: the Harold Washington library downtown, Sulzer on the North Side, and Woodson on the South SideMost branches are open from 9 a.m. to 9 p.m.. Under the new plan, which is still being worked out, branches would open no earlier than 10 a.m. and close no later than 8 p.m.; hours would be staggered amongst branches.

While most of us watched the Olympic drama unfold in Denmark, a deal to buy the Saturn brand out from beleaguered General Motors fell apart Wednesday. The Penske Automotive Group, owned by Roger Penske, had been in negotiations with GM to take over the brand. Penske operates 253 retail automotive franchises, representing 40 different brands, and 40 collision repair centers and markets the Daimler AG Smart Car. The proposed deal would have had GM manufacture Saturn vehicles for two years, while Penske established a foreign manufacturing base. Penske ultimately walked away from the deal because they were concerned that they couldn't find a manufacturer to replace GM.

Chicago's hotel workers are clocking in today without a union contract, as negotiators from UNITE-HERE Local 1 and the Hotel Employers Labor Relations Association has yet to reach an agreement on a new pact. The previous contract expired at last night at midnight. “It’s been a fight to even just get to the table,” a spokeswoman for the hotel workers’ union told Crain's. “We’re not close, and I think we’re looking at the possibility of a major fight.”

Yesterday we told you about eight year old Shawna Lewis of Robbins, Illinois, who had the audacity to stand in front of her public library and ask the President of the United States to help keep it open.

In what may be the most adorable publicity stunt this week, eight year old Shawna Lewis of Robbins, Illinois, stood in front of the village library Tuesday to ask President Barack Obama to help keep her public library open.

Suitmaker to the president, Hart Schaffner Marx, or Hartmarx, was bought by London-based Emerisque Brands for $128.4 millon. The deal was approved in June after several congressmen and state politicians pleaded with Wells Fargo, which took billions in federal bailout funds, to sell the clothier to Esmerisque, which agreed to keep production in the United States. Hartmarx slid into bankruptcy during the economic collapse of late 2008 as its access to revolving credit dried up. Wells Fargo held the bulk of Hartmarx's debt. As late as June the bank was reported to be considering selling the unit to the highest bidder for quick liquidation.

Chicago's Chief Financial Officer Gene Saffold is predicting that the city's budget hole will be worse next year. This is after the city burns through a new $320 million "rainy day fund" created from the parking meter lease. Saffold predicted a deficit of upwards of half a billion dollars next year, citing declining tax revenue and increased wages, compared against a projected budget of $6 billion. (Is this the first time the city has engaged in long-range financial planning? Publicly, at least?) While raising taxes is a last resort, according to Saffold, "nothing is ruled out at this point," Saffold told the Tribune. "The mayor has instructed us not to look at property taxes as we move forward in 2010."

As the city looks hard to close a budget hole of more than $300 million, Mayor Daley is announcing plans to furlough more than 2,000 non-union employees in the park district, the public schools, the city colleges, the Chicago Housing Authority, the Public Buildings Commission and the CTA. The unpaid days are expected to save the city $18 million. "We must continue to demand more from every employee and do more with less," Daley said at a press conference Tuesday. The bulk of the cuts will happen at the management level, affecting those earning around $90,000 a year or more. "Those savings demonstrate that we, starting at the top levels of governments in Chicago, understand the need to be part of the solution during these very, very difficult times," he said. Last month city hall laid off more than 400 city workers, after they refused to take overtime reductions and 15 unpiad furlough days.

Fresh out of bankruptcy and still getting used to the new ring Uncle Sam bought for the shotgun wedding to Italian automaker Fiat, Chrysler began production Monday at its norther Illinois Belvedere plant. The plant, which manufactures the Dodge Caliber, Jeep Patriots and Jeep Compasses is expected to bring 1,700 local autoworkers back on the clock, compared to the 2,700 it employed prior to shutting down on May 1, when Chrysler LLC entered bankruptcy.

As the deadline passed for two holdout unions to agree to concessions with the City of Chicago, the Mayor announced over 400 layoffs of city workers Wednesday. "I don't want to lay anyone off. It could have been avoided," Daley said Wednesday. "I feel for the members and of course their families." Referring to the truck drivers, library and public health and safety employees that were laid off, he said that Teamsters Local 726 and AFSCME Council 31 "have failed to reach an agreement with the city to take unpaid furlough days for the rest of the year to help us address our budget deficit and of course save our taxpayers money."

Chicago-based ShoreBank, known for making credit available in underserved communities, has been hit with a cease and desist order from the Federal Deposit Insurance Corporation, the federal agency charged with insuring deposits and regulating the liquidity of member banks. The order, which requires ShoreBank to to buttress its capital holdings and improve its asset quality and earnings and develop a plan to improve its liquidity, hasn't yet been made public. Nevertheless, it appears that ShoreBank is suffering from the same stagnant economic climate that has hobbled the rest of the banking industry. "We all got hit with a more severe recession than anyone - either here or in Washington or on Wall Street recognized," ShoreBank Chairman and co-founder Ronald Grzywinski told Crain's. While the bank asserts that it is "well-capitalized" by industry standards, it does have a plan in place to raise $30 million in capital. The bank already has a $4 million commitment.

United We Work, a job matching website fronted by Jason Kerr, founder and CEO of Chicago-based QuietAgent, is publicly available today. United We Work, "a new nationwide service designed to stimulate hiring by connecting job seekers and employers without any recruiting, job posting or advertising fees," puts employers together with job-seekers at no charge. Backed by Starbucks Coffee Co., AT&T Inc., Hyatt Hotels & Resorts and 7-Eleven Inc, as well as Sears Holdings and Allstate, Kerr's goal is to stimulate hiring by cutting out the costs associated with recruitment. According to Kerr, recruitment, job postings and advertising cost U.S. companies about $60 billion. United We Work won't cost employers anything for the rest of this year, but in 2010, firms employing more than 100 people will be charged $35 annually for the service; job seekers will continue to access the site for free.

As Illinois's political leadership struggles to close a daunting hole in the state's budget, the debate over raising taxes versus cutting services brought the governor and legislative leaders to a near standstill. The Center on Budget and Policy Priorities posted an interesting analysis of how different states are coping with decreased revenues in the ongoing economic crisis. They found that many states are looking at a combination of both spending cuts and tax increases to balance state budgets. According to their research, 23 states have raised taxes since the beginning of 2009, and 13 more states are considering tax increases.

Mayor Daley canceled his public appearances for the third straight day in a row yesterday, citing a lingering illness. The mayor was scheduled to attend a graduation of firefighters and hold a press conference unveiling new security cameras around Navy Pier. The mayor was also scheduled to meet with leaders of city labor unions in a last-ditch effort to salvage difficult negotiations over Chicago's ongoing budget crisis. "We thought it best he not mingle and shake hands with hundreds of people," Daley spokeswoman Jacquelyn Heard told the Tribune. "Rather than pass on this lingering bug, we decided to keep him [at City Hall] today." The meeting quickly became moot, however, when local labor leaders were a no-show at the meeting. Chicago Federation of Labor spokesman Nick Kaleba said the organization had no comment on the decision not to attend.

According to a survey of local employers conducted by temporary employment service Manpower Inc, 14 percent said that they expect to add more workers during the third quarter of this year, from July through September. That's an increase from the 10 percent that employers said they expected to hire in the second quarter, from April through June. Furthermore, fewer employers said that they expected to cut their workforce in the third quarter, suggesting that the recent declines in the labor market may be slowing. The survey also showed that 12 percent of employers polled expect to reduce payrolls, compared with 14 percent who said they were cutting jobs in the prior quarter. 71 percent expect to maintain their current staff levels. The construction, financial services, professional and business services, education and health services, and leisure and hospitality services sectors showed the best prospects for growth, while durable goods manufacturing, transportation and utilities, and wholesale and retail reported plans to cut jobs.

Mayor Daley hopes to hold a face-to-face meeting today with leaders of the unions representing Chicago city workers in an effort to stave off proposed budget-cutting layoffs. The mayor has been trying to get city workers to accept 16 unpaid furlough days and forgo paid overtime in an effort to close a budget deficit that is projected to be around $400 million.

While the city sits on a literal slush fund of $1.4 billion in TIF funds ($3.4 million of which they gave to London-based Willis Group Holdings Ltd to spruce up their new Sears Tower offices), City Hall is threatening layoffs if unionized city workers don't accept more cutbacks and unpaid furlough days. The city is facing a budget shortfall in the hundreds of millions of dollars this year.

The newspapers aren't the only ones hurting from the loss of ad revenue; they've been joined by the already money-starved CTA. Titan Worldwide, the company that manages ads for the CTA, has seen it's revenue fall significantly over the last several months and as a result they've fallen behind in paying several transit agencies, including the CTA. Titan CEO Donald Allman blamed the economy while CTA spokeswoman Noelle Gaffney said, "We're in discussions with them on how to address it. We expect them to meet their contractual obligation." [Sun-Times]

Hartmarx, the local suit-maker which filed for bankruptcy early this year after U.S. banks cut off credit amid the global financial meltdown, is expected to select a buyer later this week. Emerisque Brands resubmitted its bid for the troubled clothier Tuesday. Emerisque is believed to be the only bidder that will keep Hartmarx's U.S. operations largely intact. The London-based private-equity firm is interested in "acquiring substantially all of the assets" of the Chicago-based suit maker, and said it intends to operate the company "as a single going concern." The firm said in a prepared statement that "we believe in the potential and future growth of the Hartmarx family of brands, and recognize the value of a 'Made in America' label in the United States and in markets around the world," the company said in a prepared statement.

A federal arbitrator dealt what may be the final blow to United Steelworkers Local 7367. The steelworkers' union had argued that ArcelorMittal Steel USA had committed to keeping its Hennepin, IL plant open until 2012, as long as it was productive and profitable. The arbitrator ruled that ArcelorMittal could close the plant permanently. The union had been fighting to reopen the plant, or get ArcelorMittal to agree to sell it to someone who would.

Workers at the Rochester, NY Hickey-Freeman plant, which is owned by parent company Hartmarx, voted Wednesday to join Illinois workers in a sit-in if Wells-Fargo shutters and liquidates the Des Plaines suit maker, effectively throwing 3,500 families out of work. “There are a lot of married couples that work here. If they lost their jobs, their families would be devastated,” said Debbie Glinski, who has worked at Hickey-Freeman in Rochester for 15 years.

While Hartmarx employees were holding vigil outside of the Des Plains plant that makes the President's suits, State Treasurer Alexi Giannoulias was putting Wells Fargo on notice that their future business relationships with the State of Illinois could be in jeopardy. That's because Wells Fargo holds the majority of the bankrupt clothier's debt and is reportedly leaning toward liquidating the company's assets, recouping their funds quickly, but throwing over 3,000 people out of work. "Unless the company remains open, [Wells Fargo] will not be doing business with the state of Illinois any longer," Giannoulias told workers outside the plant.

As promised, Congresswoman Jan Schakowsky is turning up the heat on Wells Fargo, the largest holder of Chicago-based Hartmarx's debt, in hopes that they will select a company that will keep the storied suit maker intact and in business. Hartmarx has been in Chapter 11 bankruptcy since late last year, and three companies are vying to take over the maker of President Obama's suits. Recent reports indicate that Wells Fargo favors liquidation, yielding a quick return of the bank's funds at the expense of 3,000 midwestern jobs.

In spite of all the previous secrecy around Mayor Daley's "wishlist" for American Recovery and Reinvestment Act funds, the mayor finally announced plans to spend nearly $20 million in federal funds Wednesday. $2.3 million of the federal funds will be used to prevent the closing of four mental health clinics in the city. The rest of the funding will go to help the unemployed, homeless, poor workers and military veterans access social services that track people into job training and placement, as well as substance abuse programs. Nearly $2 million will go to support small businesses with hiring.

Hart Schaffner Marx, (known as Hartmarx), the maker of President Obama's suits, is having a tough time in this difficult economy. The maker of high-end men's suits saw a significant drop-off in sales at the end of last year, as the luxury clothing market suffered from the economic crash. As then-President-elect Barack Obama was preparing to head to Washington to take the reigns of an economy that was in a free-fall, the previous administration was busily shoveling taxpayer dollars into the financial system to to prop up a faltering banking system. Among the banks that took government money to stay afloat was Wells Fargo, which accepted $25 billion in Troubled Asset Relief Program (TARP) funds. Shortly after taking that money, however, Wells Fargo cut off credit to Hartmarx, which was subsequently forced to file for Chapter 11 bankruptcy protection. Since then the manufacturer of high-quality suits, which employs more than 3,000 people in Illinois and Michigan, has been trying to regain its footing in the luxury men's apparel business.

     

Members of USW Locals 101, 1011 and 7367 held a rally in downtown Chicago Thursday afternoon at the Federal Plaza to demand that ArcelorMittal Steel either reopen their Hennepin, IL finishing plant or allow it to be sold to another company that will. Despite turning a profit of $48 million last year, the global steel giant has idled the Hennepin finishing mill, leaving 300 families downstate unemployed in a county with a 14.1 percent jobless rate. Governor Pat Quinn joined the rally as well, declaring that Illinois needs strong middle class jobs if the state is going to thrive in the economic recovery.

Other findings from the report worth noting include
• There was 1 job opening for every 5 Midwesterners seeking a job in February 09;
• 936,259, or 11.3 percent of Chicago area residents live at or below the poverty level;
• The growth of the overall senior population in the Chicago area has increased 3.4 percent, but the growth of seniors in the labor force in the Chicago area has grown by 14.6 percent since 2000;

Governor Pat Quinn was in Chicago's West Lawn neighborhood this weekend to sign into law a bill that extends a 90 day grace period to homeowners facing foreclosure. The bill, which passed the state legislature in late January, prohibits lenders from beginning foreclosure proceedings during the first 30 days of delinquency. After that, lenders are required to tell homeowners that they have 30 days after that period to seek credit counseling. Homeowners who get counseling from a HUD-approved credit counselor then have an additional 30 days to work out a plan to begin making payments on their home loan again.