Chamber Members:
All seems to have gone well with the move to Phase 5 on Friday and over the weekend. Today’s positive cases were under 200. Please let us know if you have any lingering concerns or questions.
Today’s update will talk about the ongoing energy negotiations in Springfield as lawmakers are called back into session this week. The rest of the update focuses on workforce as we have articles to share about people walking away and quitting, those retiring and that impact, childcare, and visa backlogs.
*Daily Coronavirus update brought to you by Silver Cross Hospital
Energy Working Group Negotiations Continued Through Weekend as New Bill Surfaced
The latest draft of an energy regulatory overhaul bill that has been in negotiations for months was unveiled late Thursday ahead of lawmakers’ planned return to the Capitol to vote on it this week.
While the bill as it stands provides $694 million in subsidies to nuclear energy giant Exelon and requires that coal-fired power plants in the state must close by 2035 and natural gas plants must close by 2045, working groups of lawmakers, stakeholders and the governor’s office continued to meet Friday to negotiate the omnibus bill.
The governor’s office distributed an outline of the bill, along with a draft of an 866-page amendment, to members of the working group late Thursday. One of the major points of negotiation at this point is what to do with municipal coal-fired power plants.
The Prairie State Energy Campus, located in Marissa, Illinois, is a 1,600-megawatt coal-fired power plant that provides power to several municipal utilities in Illinois and other states. It is largely financed through municipal bonds from those communities, including Naperville, Batavia, Winnetka and others. In all, the facility cost about $5 billion and the bonds are due to be paid back through at least 2035.
“Also highlighted are the measures in the bill that pertain to the Prairie State Energy Campus, which remains subject to the declining caps on greenhouse gases,” the governor’s office wrote in a memo to working group stakeholders. “An exemption for the nation’s seventh largest polluter remains unacceptable to the Governor, as well as the nearly 50 legislators that have indicated they will not support a bill that does so.”
The governor’s proposal received pushback in the Senate as the May 31 scheduled end of session passed, with Senate President Don Harmon citing concerns about municipal coal plant closures from members of his Democratic caucus as a reason for slowing the bill down. Harmon’s office had drafted a bill separate from the governor’s this week, which a spokesperson said was drafted to drive discussion through the weekend working group sessions.
Rep. Ann Williams, D-Chicago, who was the sponsor of the Clean Energy Jobs Act bill, which has been a major part of working group negotiations, said in a phone call Friday the group is in the process of reconciling some portions of the two draft energy bills, including the coal-fired power plant measures.
She was one of the lawmakers who signed onto a letter urging the governor not to exempt Prairie State from closure, and she noted the municipalities saddled with bond debt for the facility will have to repay that no matter what happens with the legislation. Shuttering the plant would allow the municipalities to procure cleaner, and possibly cheaper, energy, she said. But lawmakers from Springfield and the Metro East area, which includes the Prairie State plant, held a news conference last week strongly opposing closure of the Prairie State Campus and Springfield’s City, Water, Light and Power municipally-owned coal-fired power plant. They urged an exemption for the two plants.
A coalition of more than 20 labor unions also sent a letter to the governor Thursday requesting the plants be exempted from closure by 2035 as well. “Combined, these two plants employ more than 1,100 workers and support an additional 1,000 skilled union tradesmen and women in good, high paying jobs,” the union leaders wrote in the letter. “If legislation is enacted to close these plants before the end of their useful lives, there will be devastating consequences. Thousands of employees will lose their jobs, stifling economic activity in areas of the state where jobs can often be hard to come by.”
But the governor’s bill, in the form introduced Thursday night, would still include the Prairie State Campus for closure by 2035, although it would also contribute $2 million annually in ratepayer funds for decommissioning costs. It would also create a new task force to “investigate carbon capture and sequestration and debt financing options for Prairie State and affected municipalities.”
The bill does not include a price on carbon emissions, which had been in a previous version, which means most of the measures in the bill are ratepayer funded. Instead, it authorizes the governor to create a “commission on market-based carbon pricing solutions.”
The bill would also create state subsidies for three new nuclear plants, making it so five of Exelon’s six Illinois plants are receiving subsidies. Braidwood, Byron and Dresden plants would receive $694 million combined in total over five years. Plants in Clinton and the Quad Cities received a 10-year subsidy of over $2.3 billion total under the 2016 Future Energy Jobs Act.
According to the governor’s office’s analysis, the “average residential ratepayer” would pay about 80 cents per month extra for the subsidies. The average residential customer would be asked to pay about $1.22 extra per month to pay for an added investment in renewables such as wind and solar power. That would aid the state’s effort to achieve 40 percent renewable energy by 2030. Ratepayers would pay an estimated added 86 cents per bill for an expanded low-income weatherization program.
The proposal would also require the Illinois Commerce Commission to investigate how and if utility giant Commonwealth Edison used ratepayer funds “in connection with” the company’s conduct as outlined in a deferred prosecution agreement last year in which the company admitted to bribery charges. The company allegedly gave no-work jobs to close associates of House Speaker Michael Madigan, who has not been charged. It would require that ratepayer funds which were used in connection with conduct outlined in the court document to be returned to ratepayers.
The bill would also end automatic formula rate increases, which allow utilities to raise rates by essentially bypassing regulators. The bill would restore a process of requiring approval before an increase, or requiring “performance-based” ratemaking, according to the governor’s office. It also requires an independent audit of the electric grid and expenditures since 2012.
The bill also does not change the way energy capacity is procured in Illinois as it would have in previous versions. The bill also sets goals of putting 1 million electric vehicles on the road by 2030, including by offering $4,000 rebates for the purchase of electric vehicles, as well as rebates or grants that fund up to 80 percent of the cost of the installation of charging stations.
The Senate is scheduled to return Tuesday and the House Wednesday to consider an energy bill.
Forget Going Back to the Office—People Are Just Quitting Instead
More U.S. workers are quitting their jobs than at any time in at least two decades, signaling optimism among many professionals while also adding to the struggle companies face trying to keep up with the economic recovery.
The wave of resignations marks a sharp turn from the darkest days of the pandemic when workers craved job security while weathering a national health and economic crisis. In April, the share of U.S. workers leaving jobs was 2.7%, according to the Labor Department, a jump from 1.6% a year earlier to the highest level since at least 2000.
The shift by workers into new jobs and careers is prompting employers to raise wages and offer promotions to keep hold of talent. The appetite for change by employees indicates many professionals are feeling confident about jumping ship for better prospects, despite elevated unemployment rates.
While a high quit rate stings employers with greater turnover costs, and in some cases, business disruptions, labor economists said churn typically signals a healthy labor market as people gravitate to jobs more suited to their skills, interests and personal lives.
Several factors are driving the job turnover. Many people are spurning a return to business as usual, preferring the flexibility of remote work or reluctant to be in an office before the virus is vanquished. Others are burned out from extra pandemic workloads and stress, while some are looking for higher pay to make up for a spouse’s job loss or used the past year to reconsider their career path and shift gears.
Altogether, human-resource executives and labor experts see a wave of resignations. In a March survey of 2,000 workers by Prudential Financial Inc., one-quarter said they plan to soon look for a role with a different employer.
“People are seeing the world differently,” says Steve Cadigan, a talent consultant who led human resources at LinkedIn during its early years. “It’s going to take time for people to think through, ‘How do I unattach where I’m at and reattach to something new?’ We’re going to see a massive shift in the next few years.”
Retiring Workers Alter Fed’s Calculus on Jobs Shortfall
Federal Reserve officials have long said a key condition for raising interest rates is a return to maximum employment. Their evolving views about how much job growth that will entail could lead them to roll back support for the economy sooner than previously expected.
Policy makers are likely to discuss when and how to start reducing monthly purchases of bonds, a prelude to eventually raising rates, at a meeting this Tuesday and Wednesday. They have said since December that to justify reducing bond purchases, the economy needed to make “substantial further progress” toward maximum employment and sustained 2% inflation.
The Fed has never put a number on its full employment target. Still, central bankers for months have compared current employment to the number of jobs in February 2020, before the pandemic hit the U.S. economy, to illustrate the ground that needed to be made up. Chairman Jerome Powell said earlier this year that gap was “one way of counting it.” In May, the shortfall stood at 7.6 million jobs.
But in recent weeks, policy makers have become less confident the economy can recover all the jobs lost amid the pandemic without spurring inflation. Employers added fewer payrolls than expected in April and May, even as the economy grew rapidly, wages rose and other indicators pointed to a shortage of workers. The unemployment rate also continued to fall to a pandemic low of 5.8%. In part that is because fewer people are returning to the labor force in search of work. The number of people who are working or want to work is still 3.5 million shy of February 2020, and the labor-force participation rate, at 61.6%, is down from 63.3% then.
The Fed believes many factors holding back the labor force are tied to the pandemic and will fade later this year. But one might not: The 2.6 million people who retired since February 2020, according to estimates from the Dallas Fed. A steadily aging U.S. population suggests limited scope for reversing that trend, some economists say.
“The number of people who left the labor force through retirement was higher during this pandemic recession-recovery than in previous recession-recoveries,” Cleveland Fed President Loretta Mester said June 4 on CNBC. “Typically, when people retire, they don’t come back into the labor force.”
While current Fed officials have been less explicit in their public comments, they have signaled a similar openness. “Whatever…the maximum rate of unemployment is, it’s something that varies over time for structural reasons,” Fed Vice Chairman Richard Clarida said last month. “Labor-force participation evolves for a number of reasons, and so I do think that, going forward, speaking for myself, we have to be very attuned and attentive to see how the post-pandemic labor market clears.” Because of the retirement wave, Ms. Mester said she is focusing more closely on participation in the labor force by people who are of prime working years, ages 25 to 54.
Progress toward maximum employment is one of the Fed’s main criteria for pulling back the easy-money policies rolled out during the pandemic. If officials become convinced that the economy is destined to operate with lower rates of labor-force participation than before, they could start to tighten policy sooner than expected.
Since last year, the Fed has been buying $120 billion of Treasury and mortgage bonds each month and holding overnight interest rates near zero. Many economists expect the Fed to begin reducing the bond purchases later this year or early next.
The Fed has said it would refrain from raising interest rates until inflation is 2% and likely to go higher and maximum employment is achieved. When they last released projections, in March, most Fed officials expected the first rate increase in 2024 or later. But since then, surprisingly strong inflation in April and May and the rethink on maximum employment suggest those conditions might be met sooner. That could be reflected in Fed officials’ updated rate projections to be released Wednesday.
Central bankers hope that by the fall—when enhanced unemployment programs expire, schools reopen and more people are vaccinated—hiring will pick up steam and some recent retirees may return to the labor force.
During the last economic cycle, Fed officials were pleasantly surprised to see unemployment reach 50-year lows without stirring inflation. That happened in part because a tight labor market steadily drew people into the workforce who hadn’t been looking for jobs. If such a pattern recurs in coming months, it would ease concerns that worker shortages could result in a more-persistent rise in inflation.
“The spike in retirements may well moderate in a stronger economy, as we saw in the year or two before the pandemic,” the Fed’s vice chairman for supervision, Randal Quarles, said May 26. But, he added, “We may need additional public communications about the conditions that constitute substantial further progress since December toward our broad and inclusive definition of maximum employment.”
Childcare: Can the Supply Meet the New Demand as Parents Return to Work?
The steep shortage of affordable, high-quality childcare for working families across the U.S. — a dire situation that was deemed a crisis decades before the pandemic — has only worsened during the past 15 months, with soaring unemployment, illness and other hardships proving devastating to families and service providers, including preschools and day care centers.
Now, with the long-awaited reopening of Illinois arriving last week, some say a critical shortage of workers, in businesses ranging from restaurants and retailers to health care and manufacturing, underscores Gov. J.B. Pritzker’s goal of transforming the state’s childcare programs by improving equity, accessibility and affordability.
On Friday, the federal Office of Child Care released guidance on how states can use the nearly $15 billion provided by the American Rescue Plan to support children, families and childcare providers. This guidance arrives as “many communities are facing childcare shortages as families look to return to the workplace and the cost of childcare places a heavy burden on family wellbeing,” federal officials said in a statement.
While the federal pandemic relief package includes $39 billion in childcare relief funding — $15 billion in emergency funds for the block grant program and $24 billion for a childcare stabilization fund — some say the enormous infusion of federal dollars alone is unlikely to solve a systemic and troubling lack of support for working families in need of safe and affordable care for their children. Due to “chronic underfunding,” just 14% of income-eligible children receive childcare assistance, federal officials said.
“We know that the pandemic did not invent these challenges, but it certainly accelerated these challenges,” Vice President Kamala Harris said Friday while visiting a bilingual childcare center in Washington. “Childcare centers were closed. Parents have been out of work. Families’ budgets have been stretched,” said Harris, who praised the Biden administration’s new child tax credit, which will provide eligible families with $250 to $300 a month per child.
ReadyNation Illinois, a nonprofit that promotes public policies and programs to build a stronger workforce, estimates that the state’s childcare crisis results in a $2.4 billion annual hit to Illinois’ economy, the organization’s state director Sean Noble said. Across the U.S., Noble said, the childcare crisis is estimated to cost the national economy $57 billion, with a recent U.S. Chamber of Commerce study finding a lack of options for childcare and related family concerns is preventing 1 in 4 unemployed workers from returning to full-time jobs. “The problem is parents need affordable and high-quality childcare so they can work, and when they can’t find childcare, the impact on the economy is writ large,” Noble said. “COVID took these decades-old problems and made them worse,” Noble said, adding, “I’ve never seen more hurdles related to childcare. … As a society, we’ve got to do better.”
Essential workers who had no choice but to work outside the home during the pandemic struggled to find day care for their children when centers first shut down, and the lack of sufficient day care options also forced many women to leave the workforce so they could supervise their children’s remote learning. Even with Illinois’ reopening, the already dwindling contingent of qualified childcare workers nationwide has been further decimated, making it nearly impossible for some early childhood centers to fully staff their programs.
Covid-19 Visa Backlogs, Travel Curbs Strain Businesses in Need of Workers
Although federal officials have eased Covid-19 restriction guidelines, the U.S. still has kept travel bans on 33 countries, including the U.K., much of Europe, China and India. Citizens of those countries for the most part aren’t being granted work visas even if they are vaccinated or test negative for Covid-19.
In countries that aren’t banned, monthslong backlogs at consulates make it difficult for foreign workers to get visas. Of the 223 U.S. consulates that normally process work visas, 160 are currently accepting appointments, the State Department said.
Julie Stufft, who heads visa services for the State Department’s Bureau of Consular Affairs, said most consulates abroad must limit service because of the pandemic, and the government is aware that reduced visa processing and the limited granting of exemptions have caused disruptions. The State Department has prioritized helping American citizens and people applying to immigrate rather than work temporarily. “A lot of this is wrapped up in maintaining safety in our facilities abroad,” Ms. Stufft said.
The situation has frustrated workers and businesses who say the U.S. must shift its policies to recognize vaccinations and widespread Covid-19 testing. “No matter what company or employer we’re talking about, if they have to lose this person or this person is stuck overseas, that has a negative impact on their business and on the economy,” said Susan Cohen, a Boston-based immigration lawyer who represented Mr. Ryder.
The shortage in foreign workers comes as the number of unfilled jobs in the U.S. rose to a record 9.3 million positions in April, the Labor Department said last week.
Regions of the country that are centers for summer recreation but have small populations—such as Wisconsin Dells, Wis., and Cape Cod, Mass.—are normally dependent on foreign labor. Restaurant and resort owners can’t rely on those workers this year, and they have been reducing service despite surging demand from pandemic-weary customers.
Summer camps, which typically hire about 25,000 camp counselors from abroad each year, are increasing camper-to-counselor ratios, reducing the number of campers and, in some cases, closing altogether, camp owners and industry officials said. The Labor Department has said the accommodation and food-service industries had 1.3 million vacant positions in April, along with 248,000 in arts, entertainment and recreation.
The Biden administration allowed a Trump-era ban on work visas to expire March 31. Trump administration officials said the ban was intended to safeguard jobs for unemployed Americans as the economy sputtered because of lockdowns designed to contain the pandemic. But the ban’s expiration hasn’t made much of a practical difference.
In 2019, about 108,000 foreign college students came to the U.S. through the J-1 summer work-travel program, according to State Department data. In 2020, fewer than 5,000 college students came through the J-1 program. The State Department declined to provide data for this year. People working in the recreation industry say the number is on track to be even lower than in 2020.
Citizens of banned countries can enter the U.S. if they first quarantine for two weeks in a third, nonbanned country, but the State Department won’t issue their visas unless they qualify for a narrow set of exemptions, such as healthcare workers.
Program Notices & Reminders – Expanded Information
| Small Business Tax Credit Programs Did you know that the American Rescue Plan extends a number of critical tax benefits, particularly the Employee Retention Credit and Paid Leave Credit, to small businesses? Learn more |
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Small Disadvantaged Business Contracting Goal News On June 1, 2021, the centennial of the Tulsa Race Massacre, the Biden-Harris Administration announced new steps to help narrow the racial wealth gap and reinvest in communities that have been left behind by failed policies. Specifically, the Administration is expanding access to two key wealth-creators – small business ownership and homeownership – in communities of color and disadvantaged communities.
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Federal Contracting Webinar Series Do you need help with federal contracting? The ChallengeHER webinar series offers education and training on the federal contracting system. Below is a list of upcoming webinars. |
8(a) Orientation Workshop/SAM Registration
This webinar will provide an overview of the 8(a) Business Development program, eligibility requirements, program benefits and training, steps to registering in the System for Award Management (SAM) database in order to do business with the federal government. Wednesday, June 16, 9:30 a.m.
Register
CDC Mask Guidance
The CDC still recommends that unvaccinated people continue to take preventive measures, such as wearing a mask and practicing social distancing. In their latest guidance, the CDC now reports that indoor and outdoor activities pose minimal risk to fully vaccinated people and that fully vaccinated people have a reduced risk of transmitting SARS-CoV-2 to unvaccinated people.
Fully vaccinated people can:
• Resume activities without wearing masks or physically distancing, except where required by federal, state, local, tribal, or territorial laws, rules and regulations, including local business and workplace guidance
• Resume domestic travel and refrain from testing before or after travel or self-quarantine after travel
• Refrain from testing before leaving the United States for international travel (unless required by the destination) and refrain from self-quarantine after arriving back in the United States
• Refrain from testing following a known exposure, if asymptomatic, with some exceptions for specific settings
• Refrain from quarantine following a known exposure if asymptomatic
• Refrain from routine screening testing if feasible
For now, fully vaccinated people should continue to:
• Get tested if experiencing COVID-19 symptoms
• Follow CDC and health department travel requirements and recommendations
Governor Pritzker Mask Changes:
Finally, join us in June for our re-scheduled luncheon with Police Chief Dawn Malec and Fire Chief Greg Blaskey on Wednesday, June 16 at Harrah’s Joliet Casino & Hotel. You may make reservations here: http://jolietchamber.chambermaster.com/events/details/2021-member-lunch-june-16-meet-greet-with-joliet-police-fire-chiefs-6060
Stay well,
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Mike Paone
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry
mpaone@jolietchamber.com
815.727.5371 main
815.727.5373 direct