City’s top 10 business stories of the year
Marijuana businesses flourish, the minimum wage rises to $15, and Boeing grapples with the 737 Max crisis in 2019.
With a new governor and mayor, several pieces of legislation passed this year that created business opportunities for Chicago in the marijuana and gambling industries. But not everything was about growth. Illinois soybean farmers struggled with a mix of bad weather and tariffs, and Johnson Publishing, the former owner of Ebony and Jet magazines, filed for bankruptcy. Here are the top 10 local business stories of 2019:
Illinois legalizes weed: The state became the 11th in the nation to allow recreational marijuana use, with sales set to start Jan. 1, and companies rushed to cash in on the potential business opportunity. Illinois approved licenses for cultivation centers to grow recreational cannabis, and dispensaries to sell it. Chicago-based weed companies expanded their offices and hired more employees. By year’s end, before recreational sales even had begun, the industry had consolidated. And through it all, advocates pushed for increased diversity in weed businesses and more opportunity for people harmed by the war on drugs.
Real estate megaprojects take shape: Two megaprojects — Lincoln Yards on the city’s North Side and The 78 in the South Loop — were approved, despite local groups opposing the use of tax increment financing. The two projects will continue the development of the Chicago Riverwalk and create thousands of permanent jobs once they secure key tenants. Meanwhile, The Old Post Office opened to initial tenants in
October. Uber Technologies, Walgreens and Ferrara Candy are among the companies moving into the renovated building.
Fair workweek law, higher wages: Chicago moved to raise its minimum wage to $15 an hour by 2021, four years ahead of when the state meets that threshold. Tipped workers, who collect a lower wage and sometimes struggle to make ends meet, joined the movement, and some groups sought legislation that would require those service workers get the full minimum wage. The ordinance that passed left the subminimum wage in place, though it will rise to $8.40 an hour July 1 and $9 in 2021. A separate city ordinance now requires employers to provide an advance work schedule to employees.
Tech sector optimism: The city notched gains in tech employment. Uber Technologies said it was looking to add more than 2,000 employees as it moved its offices into
The Old Post Office earlier this year. San Francisco-based Glassdoor was recruiting 500 workers while expanding its office floor space in the Fulton Market district. Google said it would expand its finance team in Chicago, creating hundreds of jobs. Plus, two local tech companies went public — wireless internet firm Cambium Networks and Sprout Social, a company that provides software for businesses to manage their social media accounts.
Boeing Max 737 plane woes: The board of Chicago-based Boeing ousted CEO Dennis Muilenburg Monday as the company continued to deal with the aftermath of two deadly crashes of its 737 Max jets in October 2018 and March 2019, which killed 346 people. The Federal Aviation Administration grounded all Boeing 737 Max jets in March and the model has yet to be approved to return to the skies. Major carriers like United, American and Southwest airlines repeatedly juggled their schedules, and Congress demanded answers from company executives.
Former Outcome Health execs face criminal charges: Four former executives face criminal charges for their alleged roles in a nearly $1 billion fraud scheme at the Chicago company. The charges followed a tumultuous couple of years for Outcome, which installs screens and tablets in doctor’s offices and waiting rooms that run pharmaceutical ads and educational content. Three of the charged former executives, including former CEO Rishi Shah, former President Shradha Agarwal and former Chief Operating Officer Brad Purdy, pleaded not guilty to their alleged roles in the scheme. But the fourth, Ashik Desai, pleaded guilty and is cooperating with the government’s investigation. The four face a combined 26 counts of fraud, the most serious charges carry penalties of up to 30 years in prison if convicted.
Farmers struggle: Farmers said it was a nightmare of a year as they grappled with volatile prices, high production costs, unpredictable weather and trade uncertainties. After President Donald Trump imposed steep tariffs on steel and aluminum imported from other countries in 2018, China hit back with its own 25% retaliatory tariff on U.S. soybeans. Illinois is the largest producer of soybeans, and China, the state’s biggest buyer, stopped purchasing them. Some soybean farmers said they were able to break even thanks to federal assistance offered to those affected by the trade war. Bad weather didn’t help. An unusually rainy year delayed crop production throughout the state.
Johnson Publishing goes bankrupt: The former owner of Ebony and Jet magazines filed for bankruptcy over the summer. The company sold its Ebony photo archives for $30 million, and the buyer, a consortium of foundations, said it would donate the collection to the Smithsonian National Museum of African American History and Culture and other museums to ensure public access. Linda Johnson Rice, the daughter of Ebony founder John Johnson, resigned as chairman emeritus of the Ebony Media board, stating in an email to the new owners, a Texas private equity firm, that the magazine brands were not living up to their legacy in the African American community.
Gambling expansion in the state: In the spring, Illinois lawmakers bet big on a massive gambling expansion bill in hopes that it would spur a pipeline of much-needed revenue for both the state and Chicago. The legislation, among other things, called for construction of a large casino facility in Chicago, with about 4,000 gambling positions that include slot machines and table games. But dreams of having a
Las Vegas-style attraction in the city were put on hold after consultants, hired by the state to conduct a feasibility study, found the high tax burden would not be attractive for developers and the five locations proposed by the city would not draw big crowds. Sports betting and five new casinos across the state are also under construction, while several other gaming establishments in Indiana are expanding.
Labor strife: Unionized workers staged a wave of walkouts as they demanded better contracts from employers and city leaders. The Chicago Teachers Union went on strike in October for more than two weeks, demanding smaller class sizes and more nurses and social workers at every school. After negotiations with city leaders, the union received a five-year contract that answered many of its demands. More than 2,200 University of Chicago Medical
Center nurses went on strike in September. In November, nurses voted to authorize another strike, but that one was averted after the union reached an agreement with the hospital. Hospital service workers at Mount Sinai Hospital also planned a walkout in early November but called it off after reaching an agreement with their hospital.