(page 1 of 5)
Whether we’re in a recession or still teetering on the brink of one, you don’t need a degree in the dismal science to see that the times are dismal. Tumbling home values, credit markets in crisis, skyrocketing food and energy prices, and the occasional investment-bank meltdown are just some of the troubles jolting the U.S. economy. Now the pain is leaching into the workplace, where pink (as in slips) is the year’s hot new color—the economy lost 260,000 jobs in the first four months of 2008—and gloom the prevailing mood.
It’s the Stupid Economy
Undaunted, we went in search of local employers who are defying the economic odds and positioning themselves to emerge even stronger once this downturn ends. While many companies are tightening belts, laying off workers, and hanging on for dear life (see “It’s the Stupid Economy"), a wide range of local workplaces—from global corporations to mom-and-pop outfits to not-for-profit organizations—are not just surviving but thriving and even hiring. We found a drugstore titan filling the prescriptions of aging boomers (a growth business indeed); a downstate heavy equipment maker riding the global boom in commodities and industrialization; and two restaurant chains easing the strain on consumer wallets with tasty and affordable food. There’s even a bank that emerged relatively unscathed from the credit crisis.
To make it onto our list, organizations had to have sound financial performance or backing, an appetite for expansion, an ability to hire new workers, and a reputation for a supportive work environment. A few names on our list may even prove to be shrewd holdings for long-term investors. Surviving hard times is not easy. But it can be done, and the workplaces we dug up are proving it.
Leading provider of independent investment research and advice, best known for its ratings of mutual funds
CHICAGO-AREA EMPLOYEES: 925
If you’ve ever invested money in a mutual fund, you may have based your decision on the rating it had earned from Morningstar, one of the world’s most trusted names for unbiased investment advice. Joe Mansueto launched the company in 1984 out of his Lincoln Park living room to help ordinary investors make better sense of mutual funds, which had exploded in popularity but were not well understood at the time. Morningstar’s easy-to-grasp star ratings of fund quality became the industry’s gold standard, and Morningstar has since expanded into other realms of financial research and advice. Today the company taps its database—which tracks 265,000 mutual funds, stocks, hedge funds, variable annuities, and other securities—to guide not just individual investors but also professional financial advisers and institutional clients such as mutual fund companies, banks, and brokerage houses.
HELP WANTED: If the market funk that has roiled investors in recent months should morph into an ugly bear market, demand for the kind of investment advice Morningstar offers could wane as well. But so far in this volatile market, Morningstar’s business has boomed, and the company has been adding workers to meet growing demand. Over the course of 2007, the work force grew by 23.6 percent, to 2,040 employees worldwide, almost half of them in Chicago. Recently the company was looking to fill about 50 positions, most of them in Chicago, including stock analysts, data experts, technical staff, and more.
PERKS AND BENEFITS: Morningstar has won praise for its enlightened policies toward workers. “I like the fact that we treat people as adults,” says Mansueto. Employees can take as much vacation time as they want, provided their work gets done, but they are encouraged to take at least three weeks a year. Every four years, employees can take a six-week paid sabbatical. The work environment is open, designed to foster creativity, and it’s egalitarian—even the billionaire Mansueto sits in a cubicle.
STOCK WATCH: Morningstar is one of those stocks that always seem cheap only in retrospect (it has more than tripled since its initial public offering in May 2005 and trades at a seemingly lofty 35 times the earnings analysts expect for this year). That remained the case after May’s blowout quarterly report—revenues climbed 31 percent; earnings soared 42 percent—which sent the stock up more than 20 percent. Still, it’s a powerful brand with a wide competitive moat and breathtaking growth prospects. If the share price drifts down from its recent $70, the time could be right to lasso this shooting star.
* * *
Global provider of auditing, consulting, financial advisory, and tax services
HEADQUARTERS: New York City
CHICAGO-AREA EMPLOYEES: 3,500
Even in troubled times, says Carl Steidtmann, chief economist for Deloitte Research, companies can still grow if they are “diversified across enough sectors of the economy to buffer them from a downturn in any one sector.” He was talking about companies in general, but he could have been describing his parent company, Deloitte LLP, which serves clients around the world with an array of auditing and consulting services. “We have a broad and deep set of businesses serving a broad and deep set of clients, from global corporations to midsize companies to entrepreneurs,” says Deb DeHaas, a Midwest regional managing partner in Deloitte’s Chicago office. “While some of them may be up or down, depending on the business cycle, they all balance each other out very nicely.” Case in point: Deloitte’s mergers-and-acquisitions transaction work has slowed over the past year; but, as many clients have struggled to stay profitable, Deloitte has done a brisk business advising them on cutting costs, improving efficiency, and restructuring operations.
HELP WANTED: During the fiscal year that ended May 31st, Deloitte’s Chicago work force grew by 6.6 percent (a tad better than the 5.9 percent for its total U.S. work force). The company is always hungry for workers with finance and accounting backgrounds. The Chicago office recently had 400 open positions listed at all levels of experience and across a broad range of jobs, from frontline client consultants to a variety of pros who support them, in marketing, business development, finance, information technology, human resources, and more.
PERKS AND BENEFITS: Deloitte is a perennial on various annual lists of the best places to work. And last year it ranked number one on BusinessWeek’s roundup of the best places to launch a career, reflecting its excellent training and career development programs. Deloitte also scores high on measures of work-life balance (abundant options for job sharing, compressed workweeks, and telecommuting), diversity (33 percent of employees are minorities; 45 percent are women), and community involvement (for the company’s annual Impact Day last year, 1,900 employees from the Chicago office volunteered on projects that benefited the American Red Cross, Renaissance 2010, and the Illinois Hispanic Chamber of Commerce).
* * *
CITADEL INVESTMENT GROUP
One of the world’s largest hedge fund management firms
CHICAGO-AREA EMPLOYEES: 900
It’s hard to think of a better business to be in during volatile economic times than one whose expertise is in managing risk, which is what hedge funds do. Yet even among these arcane investment vehicles, Chicago’s Citadel Investment Group stands out. In 2007, when the average hedge fund returned about 10.4 percent, the agile and opportunistic Citadel—investing in a bankrupt subprime lender, the online broker E-Trade, and other distressed businesses—returned 30 percent and boosted assets from $13.4 billion to $20 billion. Citadel has been pushing aggressively into international markets by hiring senior executives in places like Hong Kong and London, and it intends to deepen its reach into nearly every asset class. But you don’t have to be a whip-smart master trader to find opportunity there. Spying an opportunity to provide administrative services to other hedge funds, Citadel recently spun out its back-office operations as a subsidiary called Citadel Solutions. It offers support services—reconciling financial documents, tracking trades, monitoring compliance, valuing portfolios—to Citadel Investment Group and other hedge funds, freeing them to focus on what they do best. “We manage the life cycle of the trade after the execution of the transaction,” says Ann Marie Davis, head of global operations at Citadel Solutions. “A lot of these [trading] firms are not good at and not interested in being in that business.”
HELP WANTED: Since launching as a subsidiary in July 2007, Citadel Solutions has grown from 100 employees to 170, and it continues to ramp up, says Davis. With about 35 positions currently open, the subsidiary is looking for technology experts, accountants, financial analysts, marketing pros, and client support specialists.
PERKS AND BENEFITS: Kenneth Griffin, Citadel’s founder and CEO, could attest to the rewards of the hedge fund business—he earned an estimated $1.5 billion last year, according to the magazine Alpha. But even at the lower ranks, “this is a culture where performance is rewarded,” says Davis. Other perks include an on-site gym, tuition reimbursement, and free classes taught on-site by University of Chicago professors. But ultimately Citadel Solutions is about opportunity, says Davis, the chance to join a start-up and help build it. “We look at the opportunities here not as a job but as a career,” she says.
* * *