Global Chicago: Da Bulls, Da Bears, Diversity
Chicago United is a 38-year old group devoted to “Enriching the economic fabric of the Chicago region by building sustainable diversity in business leadership.” On March 10, I participated as a panelist at the first of a three-part series titled “Chicago: A Global City, A Global Perspective on Diversity.” Together with my co-panelists Paul O’Connor and Saskia Sassen, we addressed whether Chicago had become a global city and, more importantly to the Chicago United audience, whether Chicago was working effectively from the standpoint of diversity as a business imperative in the global marketplace.
Here are my thoughts, though I’d like to hear yours as well!
The Chicago metropolitan area (Chicago) lies on the razor’s edge with respect to its future. So-called globalization lies at the heart of what has brought Chicago to its critical crossroads. To put it simply, depending on both its own actions and on the fates, Chicago can possibly become a backwater business capital city of a shrinking and largely unimportant region of the United States. Alternatively, Chicago can become an independent city of global importance, a city that attracts the world’s most talent business makers, artists, policy makers, and idea-creators. As such, Chicago could even become the portal that helps revive a surrounding Midwest region which is sorely in need of revival and re-invention.
Globalization means that the world’s economy has become more integrated and intertwined, and its regions more subject to frequent and profound shifts and changes. This is so because communication costs and transportation costs have fallen dramatically. For example, costs of shipping a ton of cargo dropped by three-fold from 1920 to 1960, and containerization and transport by larger and larger ocean-going ships continue to pressure prices downward today. Air shipping costs have dropped by 80% since the mid-1950s. And while many of us complain about airline deregulation and recent security procedures, personal air travel is now much more affordable to average Americans.
Communications cost declines are even more dramatic. The cost of a three-minute phone call from New York to London was once the equivalent of $350 in 1930 in today’s terms. These same communications facilitate both cargo and personal logistics, as well as propelling traded services, information, and capital around the world.
On top of this, most of the world’s nations have agreed to lower barriers to the flow of goods, capital, intellectual property, and sometimes travel and immigration.
How has globalization impacted Chicago? The pressures and challenges are great. Chicago can be characterized as the business capital city of a shrinking economic region. Chicago was borne of the gathering of farm products and natural resources, the sorting and shipping of these products, the financing of these products, and the supply of business and legal services to farms and agri-businesses throughout the Midwest.
In parallel, Chicago became a great manufacturing city as result of its transportation/hauling capability and facilities. Chicago gathered Midwest resources and transformed them more productively than any place on earth. So did other Midwest cities, but Chicago also became the business capital of these lesser cities in supplying them business, financial, and legal services.
Without belaboring the point, these same activities are today shrinking as sources of household income and jobs for both Chicago and its surrounding Midwest. For the most part, technical progress has diminished the need for workers here in Chicago in these activities, even while the attendant productivity gains have raised standards of living both here and around the nation. Growing world trade and import competition have contributed to local pressures and shrinkage. Prices for commodities and routine manufactured goods have declined, too, as both farming and manufacturing have become hugely productive—victims of their own success. And so, income and job growth generated from these activities are now weaker.
Does Chicago have a bright future? Its future likely rests with its ability to grow and develop linkages beyond its immediate region. It must produce services—high valued and sophisticated services– that are valued in markets far from the Midwest. In the process, it can possibly lead the surrounding region to new markets as well. This is Chicago’s vision of becoming a successful global city.
In re-inventing itself as a global city, Chicago must attract (and also grow locally) the world’s business makers and highly skilled occupations and entrepreneurs.
Thankfully, super large cities such as Chicago are favored in recruiting skilled workers and entrepreneurs, and developing them locally. That is because learning and the networking necessary for career advancment is more attractive in places with many and diverse skilled work force activities. So too, the U.S. work force has become more composed of two-earner families, mostly due to rising labor force participation of women over the past 35 years. Because large cities such as Chicago offer large and diverse work force opportunities, employers can more easily attract highly skilled and specialized workers. Urban amenities are also attractive to many highly skilled or educated workers, perhaps blunting the pull of warmer climates elsewhere.
Within the Midwest, Chicago and the Twin cities are the magnets for highly skilled young workers, ranking 11th and 5th respectively among U.S. metropolitan areas in the proportion of its population aged 25-34 having college degrees.
Chicago also continues to attract immigrant population. Arguably, the single most important indicator of a region’s future and prospects for success is whether people are “voting with their feet” in choosing it as a place of promise. Within the Midwest, thanks to ongoing in-migration of Hispanic, Asian, East European, and other peoples, Chicago’s 17 percent foreign born population far outdistances other Midwest metro areas in its proportion of foreign born. These are people who bring new ideas and new ambitions to the Chicago area.
What signs are there Chicago’s industry base is well-poised for the emerging global economy? Chicago’s economy can look at several promising aspects. Business and legal services were the growth engines of Chicago’s economy in the 1980s and 1990s, outdistancing the growth of such jobs in every other U.S. metropolitan area. Management consulting, accounting, public relations, and the like represent services that Chicago is now selling around the nation and the world. The combined number of jobs in finance, legal, and business services in Chicago surpassed those in manufacturing by the early 1990s.
So too, Chicago’s financial exchanges have shaken off their competitors in many regards along with their institutional sclerosis. They are once again healthy and growing, seeking global partners and markets.
Chicago’s world class universities can count among them the leading business, medical, and professional schools.
In bringing in customers for these businesses, and in sending out its agents, Chicago’s O’Hare airport has been a critical vehicle, replacing what the rail hub once was to Chicago. The early innovation of McCormick Place (and later expansions to it) has made the region a global meeting place for business, commerce, and culture. Rising tourism has followed from around the nation and the world.
But, what must Chicago do if it is to continue to re-invent itself for a global economy? Among other things, Chicago cannot attract the world’s most ambitious and talented people, it cannot grow the world’s innovative and globally expansive businesses, unless it works well on the inside. Part of this working well as a city requires key infrastructure such as highways and land use planning that allows circulation of people in getting around, as well as providing public services and goods to Chicago’s residents. Metropolis2020 and other efforts and trying to lead Chicago into successful resolution of these challenges. It also involves creating the type of amenities that are world class, such as Millennium Park and Lakefront park improvements.
But perhaps more importantly, Chicago must be recognized as an oasis of opportunity for persons of every color, culture, and sex to realize their dreams and ambitions. Otherwise, business builders such as John Johnson and Oprah Winfrey will emerge elsewhere. The new generation of idea makers such as those who were pre-cursors of Genetech and Netscape will continue to move elsewhere, as will the rising stars of sports and culture such as Daniel Barenboim and Donald Young.
How can we nurture a culture of openness and opportunity here? Recognizing and understanding the threats and opportunities are half the battle. Organizational initiatives such as those of Chicago United are helpful.
We might also do well to focus on our opportunities rather than on our problems. As President Eisenhower has been quoted as saying, “If a problem cannot be solved, enlarge it.” In this instance, it is perhaps easier for us to join together when we are all going forward, when we are growing economically, intellectually, and spiritually. Accordingly, ambitious economic growth agendas and initiatives for Chicago going forward should be considered.
At the same time, as we participate in Chicago’s life and economic growth, we must all stretch ourselves personally so that we include those of us who may not live next door, or who may not look or talk or act as we do. Growth and success will make it easier for us to do so.
Walt Disney once said “Change is inevitable, growth is optional.” In the context of greater diversity and inclusion, a corollary is that neitherchange nor growth are inevitable. Rather, we must push ourselves to make them both happen. In doing so, however, we will find that inclusion and growth are mutually re-enforcing.