Illinois could be in the top 10 states for social mobility instead of the bottom 40 with fairer licensing, less taxation and more educational opportunities
PRESS RELEASE from the
ILLINOIS POLICY INSTITUTE
CONTACT: Micky Horstman (312) 607-4977
7 steps to improve Illinois’ social mobility rating
Illinois could be in the top 10 states for social mobility instead of the bottom 40 with fairer licensing, less taxation and more educational opportunities
CHICAGO (Jan. 28, 2025) – In Illinois, a low-income person’s ability to move up in society is worse than in any other Midwestern state, and 40th lowest nationally.
That is because Illinois ranks poorly when measuring four aspects of social mobility – entrepreneurship and economic growth, institutions and the rule of law, education and skills development, and social capital, according to a joint report from the Illinois Policy Institute and the Archbridge Institute. Too often, low-income Illinoisans are stifled by unnecessary or unethical government regulations.
Reforms could help Illinois’ low-income residents improve their quality of life and material well-being, the new report states. Experts from the institutes identified seven solutions that would propel Illinois towards the top-10 states for social mobility and give low-income residents the best possible opportunities to climb the social ladder.
7 solutions to help Illinois become a top-10 state for social mobility:
- Review the state's arduous occupational licensing burden. The state should be regularly reviewing and removing licensing requirements, particularly on professions that shouldn’t require an occupational license such as community association manager or cemetery customer service employee. Additionally, Illinois must enact universal license recognition to remove barriers on minorities and low-income Illinoisans.
- Reduce Illinois’ code to 150,000 instances of restrictive language. Illinois has 282,000 instances of restrictive words in the state’s administrative code that limit business and other activity, while the national average is just 135,000. Reducing these barriers would make it easier for businesses to operate and for individuals to innovate.
- Adopt an average property tax rate of 0.72%, more in line with the national average. Illinois’ current statewide average property tax rate is the second-highest in the nation at 1.95% of a property’s value per year.
- Replace the state’s corporate tax with a state gross receipts tax. Illinois currently has the second-highest corporate tax rate in the nation at 9.5%. A state gross receipts tax would reduce tax manipulation so companies could no longer rely on special privileges to reduce their tax costs. Those privileges typically benefit more politically connected firms.
- Reform abusive civil asset forfeiture policies. Law enforcement agencies in Illinois can keep up to 90% of seized assets, providing a large incentive to continue this practice; however, doing so allows for misuse and excessive extraction of assets from low-income and minority Illinoisans with few opportunities for recourse.
- Improve the return on investment for attending a state university. Illinois students have a 29.9% negative return on their investment in a college degree, which is worse than some of our neighboring states. The state could remedy that by focusing more on student outcomes, such as job placement rates.
- Promote and encourage the “success sequence.” Research has shown progressing from getting an education, finding full-time work, getting married and then having children is a proven path to improve social mobility and strengthen families. American adults who follow this model have a poverty rate of only 2%, and about 75% joined the middle class.
“Many of the problems contributing to Illinois’ inequitable lack of opportunity are man-made, which means they have man-made policy solutions,” said Josh Bandoch, head of policy at the Illinois Policy Institute. “Unnecessary government red-tape and burdensome fines and fees make quality of life for low-income residents harder in Illinois than in most other states. Illinois lawmakers can provide better educational and economic opportunities for our neighbors most in need by cutting back on regulations and reevaluating the state’s onerous taxes and fees.”
“Illinoisans deserve a state government that does not hand its residents overly-burdensome regulations, high tax rates and a predatory government that hampers mobility policies that disproportionately impact its poorest citizens,” said Justin Callais, chief economist at the Archbridge Institute. “The American Dream can exist in Illinois if the state takes its issues with corruption, poor legal policies and overregulation seriously.”
These proposed changes should be coupled with reforms to Illinois’ zoning and permitting processes, the reduction of overly-burdensome fines and fees, and the reimplementation of school choice options for low-income families. These reforms alone would ensure Illinois increases to at least the top-25 for social mobility.
To read more about Illinois’ social mobility report, visit illin.is/ILmobility.
For interviews or interviews, contact media@illinoispolicy.org or (312) 607-4977.