03132019CM1573 1OAKBROOK TERRACE– For more than a generation, young people have been discouraged from seeking blue collar jobs in favor of pursuing college degrees. State Senator Suzy Glowiak (D-Western Springs) passed a measure to help encourage more job seekers to pursue occupations that ensure safety and modernize Illinois’ infrastructure.

Glowiak championed the Blue Collar Jobs Act, which offers tax incentives to companies making significant capital improvements in Illinois based on the withholding tax paid to construction workers. The program went into effect on July 1, 2019.

"The Blue Collar Jobs Act will lift up middle class families while expanding Illinois' businesses," Glowiak said. "The key to growing our state's economy is creating new jobs, expanding economic opportunities and promoting a business climate that encourages companies to stay, expand and grow in our communities.”

The act creates four new tax credits; High Impact Business construction jobs credit, Enterprise Zone construction jobs credit, New Construction EDGE Credit and the River Edge construction jobs credit. The bipartisan program won the support of labor and business groups

The Blue Collar Jobs Act is similar to the EDGE Tax Credit program, with some of the following features:

  • An incremental income tax withholding is offered to High Impact Businesses and businesses in Enterprise Zones and Rivers Edge Areas.
  • The credit is larger if the jobs are provided in an underserved area (defined by the EDGE tax regulations).
  • The credits to the business (employer) are equal to up to 50% (or in some instances, 75% if the project is in an underserved area) of income tax withheld from construction project contractor and subcontractor employees.

Glowiak states that tax credits can only be redeemed after work is fully completed. There is no risk to the state if a company does not meet requirements since the state has already captured the withholding tax prior to when the credit is issued.

The economic development incentive comes in light of widespread labor shortages in the United States. The Associated General Contractors (AGC) of America and Autodesk reported in a 2018 survey that 80 percent of more than 2,000 U.S. construction companies indicate they are having difficulty hiring construction workers. This is an increase from 70 percent in 2017.

“This bipartisan economic development incentive is a win for Illinois workers, businesses and our economy,” Glowiak said. “It’s our duty to ensure our workforce meets the needs of the state’s businesses.”