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Illinois is the next step for labor reform

Protesters rally outside state Capitol as lawmakers push final versions right-to-work legislatiLansing Mich. Tuesday Dec. 11 2012. The GOP majority

Protesters rally outside the state Capitol as lawmakers push final versions of right-to-work legislation in Lansing, Mich., Tuesday, Dec. 11, 2012. The GOP majority has used its superior numbers and backing from Gov. Rick Snyder to speed the legislation through the House and Senate, brushing aside denunciations and walkouts by helpless Democrats and cries of outrage from union activists who swarmed the state Capitol hallways and grounds. (AP Photo/Carlos Osorio)

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Updated: January 22, 2013 6:16AM

Last week, Michigan made news by enacting major labor law reforms. It is not alone. Our neighbors in Indiana and Wisconsin have done the same.

Why are they doing this, and what does it mean for Illinois?

In recent months I’ve met with the governors of those states, and they’ve all told me the same thing. They are doing this to improve the competitiveness of their economies and recruit more employers and jobs to their states.

Illinois’ jobs picture is already worse than our neighbors’, and worse than the national average. With these reforms coming just across our borders, we’re at an even bigger competitive disadvantage and are likely to fall further behind. That’s terrible news for the workers and families of our state.

This Midwestern trend for labor reform has arisen because more states are deciding that closed shop rules are unfair and hurtful to both employers and employees. Instead, they are giving every worker the freedom to decide for themselves whether they would like to join a union, rather than being forced to do so as a condition of their employment. A worker shouldn’t be under a union boss’ thumb any more than under a business boss’ thumb. Increasingly, employers are relocating to these pro-employment freedom states, and are looking only at those states when considering job expansion decisions.

These labor issues, along with high taxes, restrictive regulations and high litigation costs have pushed more and more employers out of Illinois for years. We used to lead the nation in manufacturing employment; now, we’ve declined to merely the national average. As employers and jobs leave, our tax burden is spread over fewer taxpayers, increasing the costs for all of us who choose to remain in Illinois. The result is a long-term death spiral that can be reversed only by becoming much more attractive to businesses and their investors and much more pro-job creation for workers.

Illinois need not adopt the exact reforms found in Wisconsin, Indiana or Michigan. But we sure need to move in that direction if we are going to compete for jobs.

One creative solution is available to us that has not been tried elsewhere. Under federal labor law, states may authorize their local communities to decide for themselves whether to embrace right-to-work. Why not empower Sangamon County, or Effingham County, or any of our other local governments to decide for themselves if they would like to compete for the jobs that come with new manufacturing plants or transportation facilities built by the many hundreds of companies that will consider expanding only in flexible work areas?

This approach would lead to greater capital investment, would increase incentive to hire Illinois workers and would grow the number of companies expanding in our state.

Combined with policies that improve education and training throughout Illinois, these reforms would reverse our state’s downward employment and take-home-pay trends. It would create an environment of growing prosperity for ourselves and our children and grandchildren to enjoy here for years to come.

Illinois has big problems. It will take big solutions to fix them.

Bruce Rauner is chairman of the venture capital firm R8 Capital Partners, chairman of the tourism bureau Choose Chicago and a member of the board of the Noble Network of Charter Schools. Rauner is also an investor in Wrapports LLC, the owner of the Sun-Times.

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