WARN report: Taxpayers foot the bill for layoffs

Nearly a third of Illinois layoffs reported in April came from a taxpayer-subsidized move.

More than 1,100 Illinois workers will likely receive pink slips by the end of the year, according to April notices filed in accordance with the Worker Adjustment and Retraining Notification Act, or WARN.

The catch? Some of the layoffs were subsidized by tax dollars.

The biggest news from April’s WARN report came from Chicago-based Sunstar Americas Inc., which announced it would lay off 329 workers beginning in June. But there’s more to Sunstar’s story.

Those jobs won’t be disappearing entirely, but will be moving to Schaumburg, where the company was promised $3.3 million in subsidies in exchange for bringing 300 jobs from Chicago and creating 25 additional jobs in the new suburban location.

And that’s not all. In 2012, Illinois’ Department of Commerce and Economic Opportunity, or DCEO, inked a tax-credit agreement for the Sunstar migration worth $4.3 million over 10 years. Thankfully, a department spokeswoman says Sunstar has yet to receive any tax credits, according to the Chicago Tribune.

No Illinois business should be receiving taxpayer money to fire workers, even when it means filling the vacancies with workers in the next town over. New management at the state’s economic development agency should carefully review the Sunstar agreement.

If state lawmakers are serious about stemming the tide of Illinois layoffs, they’d be wise to pass the real reforms needed to improve the Midwest’s least-friendly business climate.

Image source: Wolfgang Lonien