Illinois is a global leader in advanced services as Chicago remains a hub for major corporate headquarters.
Industry clusters are regional concentrations of related industries.[i] Clusters consist of companies, suppliers, and service providers, as well as government agencies and other institutions that provide education, information, research, and technical support to a regional economy.[ii] Clusters are a network of economic relationships that create a competitive advantage for the related firms in a particular region, and this advantage then becomes an enticement for similar industries and suppliers to those industries to develop or relocate to a region.[iii] Clusters exist in all types of economies and are more prevalent in locations that achieve better performance relative to their overall stage of development.[iv] It is useful to view economies through the lens of clusters rather than specific types of companies, industries, or sectors because clusters capture the important linkages and potential spillovers of technology, skills, and information that cut across firms and industries.[v] Viewing a group of companies and institutions as a cluster highlights opportunities for coordination and mutual improvement.
A Location quotient is an indicator of the economic concentration of a certain industry in a state, region, county, or city compared to a base economy, such as a state or nation that measures industry clusters in a region. A location quotient greater than 1 indicates the concentration of that industry in the area. A location quotient greater than 1 typically indicates an industry that is export-oriented. An industry with a location quotient of 1 with a high number of jobs present is likely a big exporter and is bringing economic value to the community feeding the retail trade and food services sectors.
As the table above illustrates, the Great Lakes states all have a higher-than-average number of manufacturing production jobs with Illinois leading the list of having a higher concentration of manufacturing jobs than other Great Lakes states. However, with Chicago dominating the state’s economy, Illinois manufacturing sector is strong but is not as strong as other Great Lakes states.
A review of Illinois’s top occupations illustrates again the important role manufacturing plays in the state. As the graphic below illustrates, Illinois’s advanced services industry that includes administrative, education, other services, finance and insurance and wholesale trade industries are all above national averages.
Illinois’s top occupations as outlined below illustrate again the power of the advanced services sector in the state.
Illinois remains a global economic powerhouse anchored by the global mega-city of Chicago.