Seeing Tomorrow – Companies in the State

of IllinoisThe Impact of Macroeconomic Environment

Motivation

• Weaving on our theme “Seeing Tomorrow” we will focus on macroeconomic environment impacting the companies headquartered in Illinois.

• Based on long term data, we will forecast:

• Trend in assets growth (investment behavior)• Capital accumulation determines increase in employment of labor• “Extrapolating from the experience of the late 1990s, the NAIRU could be lowered by

as much as 1 full percentage point by a sustained $250 billion annual increase in infrastructure investment. This could mean that more than 1 million additional workers each year find employment”

--Economic Policy Institute

Motivation cont’d

• Trend in Revenue growth• Indicator of aggregate demand and consumption level

• Trend in Profitability (earnings) • Living standards of investors• Further investment of companies

• The management efficiency of companies

• Public Companies: • stock market listed corporations• COMPUSTATA data up to Feb 2015

• Private Companies:• Private-held corporations or LLCs or LLPs

• FACTSET data up to Feb 2015

In Chicago Metro Area 205 Outside Chicago Metro Area 26 In Chicago Metro Area 8,077 Outside Chicago Metro Area 11,367

Public

Count of Illinois CompaniesIn Chicago Metro Area 205 Outside Chicago Metro Area 26 In Chicago Metro Area 8,077 Outside Chicago Metro Area 11,367

Private

Public Companies – Chicago Headquartered

Forecasts

4.18% or $81 Billion

Forecasts

2.25%

Forecasts

3.30%

Revenue of Chicago Public Companies in 2009 Dollars

Forecasts

0.53%

Retail

Transportation

Manufacturing

Financial

Illinois Public Companies

Level of Assets of Midwest Public Firms

Hot Zone of Revenue Generation

Management Efficiency

Assets   Turnover  Ratio=𝑆𝑎𝑙𝑒𝑠𝐴𝑠𝑠𝑒𝑡𝑠

Private-held companies by state

in m

illio

n do

llars

Concluding Remarks

• Publicly listed companies:• The investment growth (asset growth) is expected to increase

• but may not beat the speed of GDP increase• The revenue growth is also expected to increase in nominal terms

• but decline if purchasing power is considered• The income growth is with more uncertainty, but is also expected to increase

on average. • Employment is expected to increase. Mainly from the financial sector and

manufacturing sector.

Concluding Remarks (cont’d)

• High management efficiency ratio of Illinois public companies • The data shows Illinois private-held companies generate highest

amount of Net Income among all states in the US.