Illinois is a global leader in financial services, which accounts for 11 percent of the state's GDP.
From the presence of two major exchanges to the headquarters of some of the world’s-largest insurers, Illinois is a global leader in financial services, an industry that accounts for some 11 percent of the state’s Gross Domestic Product.
Home to the Chicago Board of Options Exchange and CME Group, and financial services giants including Allstate and State Farm, the financial services sector supports more than 288,000 direct jobs. Driving retention and expansion of the financial service industry is the state’s highly developed communications infrastructure, facilitating instant data transfer required for trading, and the capacity necessary for complex data transfer worldwide. The state’s central location is also a strategic advantage for many companies.
Health-care service companies are also expanding operations in the region, including medical billing and software provider, Practice Velocity, which has seen explosive growth, and health insurance tech company and online health insurance exchange operator GoHealth LLC, which added 650 jobs at its Chicago offices in 2013.
Trading Tradition Fuels Growth
The positive impact in Illinois by the risk management and securities industry cannot be overstated. Since the Chicago Board of Trade (CBOT) was established as the world’s first futures exchange in 1848, the region has served as a world center for trading of agricultural and other commodities, along with its sister company, Chicago Board of Exchange (CBOE), which also provides securities trading. Chicago Mercantile Exchange (CME), with its roots going back to the Chicago Egg and Butter Board of 1898, merged with CBOT in 2007, forming the world’s leading derivatives marketplace, the CME Group.
“CME Group has been a part of Chicago for nearly 170 years because of the talent, expertise and infrastructure of our city,” says Terry Duffy, CME Group executive chairman and president. “By remaining in Chicago, we will continue to ensure that Illinois and Chicago remain the risk management capital of the world.”
Educated Workforce Creates Investment
World-renowned higher education institutions in the state provide a steady stream of highly trained workers for the financial services industry to draw upon. The Kellogg School of Management at Northwestern University and the University of Chicago Booth School of Business, where seven faculty members have won Nobel Prizes, are consistently ranked among the top 10 graduate business programs in the nation.
“Chicago’s reputation as the center for global derivatives trading in terms of innovation, scale and talent, makes it second to none in the world,” says Ed Tilly, CEO of CBOE Holdings. “Having that reputation has helped Chicago attract many of the best and brightest minds in the world. Our exchanges, brokerage firms, proprietary trading houses – actually all Chicago companies – have been fortunate to tap into that incredible pool of talent.”
CME Group established the CME Group Center for Innovation (CFI) to create and sponsor programs that encourage and showcase innovation and creative thinking for multiple industries in the public and private sectors.
The combination of available highly educated and skilled employees, and advanced infrastructure, are an advantage for other major financial services companies based in the state, including Discover Financial Services, based in Riverwoods, and AON Corp., a provider of risk management and HR services headquartered in Chicago. Independent investment research firm Morningstar Inc. has called Chicago home since its inception in 1984.
“Morningstar’s roots are in Chicago. It’s where I founded the company, and I consider this community my home,” says Joe Mansueto, chairman and CEO. “Although we operate in 27 countries today, Chicago remains an optimal headquarters for Morningstar because of its central U.S. location, the leading universities in the area from which to recruit, and steps the city has taken to make it an attractive place for firms to do business. Research, design and technology are Morningstar’s core competencies, and being headquartered in Illinois allows us to continue to attract leading talent to Morningstar and pursue innovative ways to better serve investors and help them reach their financial goals.”