Metropolitan Chicago’s Freight Cluster: A Drill-Down Report on Infrastructure, Innovation, and Workforce Full Report, June 2012 Table of Contents Introduction ............................................................................................................................................... 1 Metropolitan Chicago’s Freight Cluster ................................................................................................. 2 Metropolitan Chicago: Nation’s Distribution Hub .............................................................................. 3 History of Freight in the Region .............................................................................................................. 4 Metropolitan Chicago in the Global Supply Chain ............................................................................... 4 The Cluster Approach to Regional Economic Development ........................................................... 7 Why Clusters? ............................................................................................................................................. 7 CMAP’s Cluster Framework and Composition..................................................................................... 9 Cluster Statistics .................................................................................................................................. 9 Shift-Share Analysis ........................................................................................................................... 13 Description of Cluster Industry Activities ........................................................................................... 14 Core Freight Industries ....................................................................................................................... 14 Direct Supply/Input Industries .......................................................................................................... 23 Indirect Support/Infrastructure Industries ........................................................................................ 25 Customer Industries ........................................................................................................................... 27 Cluster Connectivity ................................................................................................................................ 28 Multiplier Analysis ............................................................................................................................ 29 Scenario Analysis ............................................................................................................................... 31 Gap Analysis....................................................................................................................................... 34 International and National Developments in Freight ..................................................................... 38 International Developments ................................................................................................................... 38 Increased Global Trade ....................................................................................................................... 38 Port Expansions .................................................................................................................................. 38 Expanded Ship Capacity ..................................................................................................................... 41 National Developments .......................................................................................................................... 44 Just-in-Time Production and Delivery ............................................................................................... 44 Multi-Modalism and Increased Rail Use ........................................................................................... 45 Domestic Competition ........................................................................................................................ 46 Looking Ahead ......................................................................................................................................... 49 Challenges and Opportunities: Infrastructure, Innovation, and Workforce ............................... 51 Infrastructure ............................................................................................................................................ 51 Congestion .......................................................................................................................................... 51 Freight Land Use Challenges .............................................................................................................. 54 Opportunities to Improve Freight Flow and Protect Freight Land Use ............................................. 57 Innovation ................................................................................................................................................. 60 Role of Innovation in Stimulating Economic Growth ........................................................................ 60 Innovation in Technology-driven Supply Chain Management .......................................................... 62 Innovation in Terminal and Carrier Operations ................................................................................ 68 “Greening” the Freight Cluster .......................................................................................................... 71 Workforce .................................................................................................................................................. 74 Occupational Analysis ........................................................................................................................ 74 Employment Growth and Contraction ............................................................................................... 75 Challenges ........................................................................................................................................... 76 Opportunities...................................................................................................................................... 78 Summary ............................................................................................................................................ 80 Cluster Support Strategies .................................................................................................................... 82 Case Studies of Existing Cluster Support Strategies ........................................................................... 83 City of Chicago ................................................................................................................................... 83 South Suburban Support Strategies ................................................................................................... 86 Will County ........................................................................................................................................ 88 Regional Efforts .................................................................................................................................. 89 State Efforts ........................................................................................................................................ 91 Gaps in Current Cluster Support Strategies ......................................................................................... 93 Moving Forward: Strategies to Strengthen the Cluster ................................................................... 95 Infrastructure Implementation Action Areas....................................................................................... 96 System Coordination .......................................................................................................................... 96 Innovative Financing and Project Prioritization ............................................................................... 97 Coordinated Land Use ........................................................................................................................ 98 Innovation Implementation Action Areas ............................................................................................ 98 Maintain Comparative Advantages, Promote Innovative Industries, and Attract Underperforming Sectors of the Cluster .......................................................................................................................... 99 University Research that Leads to Commercialization ..................................................................... 100 Expound the Region’s Innovative Status ......................................................................................... 100 Workforce Implementation Action Areas .......................................................................................... 101 Foster Public-Private Collaborations with Freight Cluster Industries and Education and Workforce Training Providers ........................................................................................................................... 101 Address “Soft-Skills” Training Needs .............................................................................................. 103 Retrain the Workforce ......................................................................................................................