Chicago has been a center for commerce in the United States since its existence (the city was incorporated in 1833). Today, it is home to 12 Fortune 500 companies and is considered to be a "Prime Accountancy, Advertising and Legal Service Center" by the Globalization and World Cities Study Group & Network. Chicago is a major transportation and distribution center. Manufacturing, printing and publishing, and food processing also play major roles in the city's economy.

 

History

Before it was incorporated as a town in 1833 the primary industry was fur trading. In the 1840s Chicago became the largest grain port in the world, shipping food from the Mississippi Valley region, after the construction of the Illinois and Michigan Canal. Many land speculators and entrepreneurs were drawn to the area. The canal also influenced the massive railroad construction from Chicago to other parts of the country.

In 1848, Chicago built its first grain elevator and the Chicago Board of Trade was established. Modern day futures and commodity trading markets were pioneered at the Board (as its commonly known), leading to Chicago's domination of the Midwestern grain business. In 1858 there were twelve grain elevators dotting the skyline. Carl Sandburg described Chicago as a "stacker of wheat," and some would argue that the grain elevators built were Chicago's first skyscrapers.

During the 1850s and 1860s, Chicago's pork and beef industry expanded. Entrepreneurs such as Gustavus Swift and Philip Armour helped the area to become the largest producer of meat products in the world. By 1862 Chicago had displaced Cincinnati, Ohio, as "Porkopolis".

Two major influences for the growth of Chicago's meat industries during the 1860s were: the Civil War increased the demand for food products and Chicago's vast transportation system ensured that goods could be delivered to soldiers quickly all over the northern United States. The second factor was the utilization of ice in meat packing plants. Beforehand, meat production and distribution facilities, known as disassembly plants, had to shut down in the hot summer months. Increased operating months created new man-hours in which people could work. The efficiency of Chicago's meat packing industry and its disassembly plants inspired others like Henry Ford when he developed Model-Ts assembly lines.

In the 1860s, Chicago's pork and beef industry represented the first global industry. As the major meat companies grew in Chicago many, like Armour, created global companies and communicated with divisions spread across the globe via telegraph.

Modern-day futures and commodity trading markets were pioneered in Chicago. A number of events led to this, along with Chicago's transportation systems and geographic proximity to the rest of the country. Massive amounts of goods passed through Chicago from places in the Mississippi Valley such as St. Louis, Missouri. Grain was stored in Chicago, and people began buying contracts on it. Later, people as far away as New York City began buying contracts by telegraph on the goods that would be stored in Chicago in the future. From this were established the Chicago Board of Trade (CBOT), the Chicago Mercantile Exchange (CME), and the modern systems in use today for futures and commodity trading.

 

Industries

 

Banking and finance

The city houses one of the Federal Reserve Banks, established in 1914. There is also the Federal Home Loan Bank of Chicago. The largest banks in the Chicago region (by % of deposits) are: JPMorgan Chase, LaSalle Bank (an ABN AMRO subsidiary), Harris Bank (a BMO subsidiary), and Northern Trust. The largest banks headquartered in the Chicago area include: First Midwest Bank, Mid America, and MB Financial, among others. Many financial institutions are in the Loop.

Chicago has four major financial exchanges, including the Chicago Stock Exchange, the Chicago Board of Trade (CBOT), the Chicago Board Options Exchange (CBOE), and the Chicago Mercantile Exchange (Merc). While the city of Chicago houses most of the major brokerage firms, many insurance companies are in the city or suburbs, such as Allstate Corporation.

 

Real estate

The central downtown area of Chicago has in recent years been heavily redeveloped, with major new condominium and office skyscrapers being either in construction or planned. These include the 92-story Trump Tower Chicago, the newly announced 90-story Shangri-La Hotel, and the planned 124-story Fordham Spire by Santiago Calatravo. The city's economic resurgence is reflected in not only the massive redevelopment going on downtown but also the planned expansion of O'Hare International Airport and Mayor Richard M. Daley's announcement about Chicago's intent to bid for the 2016 Summer Olympics.

 

Largest public companies

The following companies have their headquarters in the Chicago region:

  • Abbott Laboratories
  • Allstate
  • Aon Corp.
  • Baxter International
  • Boeing
  • Brunswick Corporation
  • CDW
  • Exelon
  • Fortune Brands
  • Illinois Tool Works
  • Kraft Foods
  • McDonald's
  • Motorola
  • Sara Lee
  • Sears Holdings Corporation
  • ServiceMaster
  • Smurfit-Stone Container
  • Tribune Company
  • Walgreens
  • Wm. Wrigley Jr. Company

 

Chicago Climate Exchange (CCX) is the world’s first and North America’s only voluntary, legally binding greenhouse gas (GHG) reduction and trading system for emission sources and offset projects in North America and Brazil. CCX employs independent verification, includes all six greenhouse gases, and has been trading greenhouse gas emission allowances since 2003. CCX was launched prior to the commencement of trading in the European Union through the ETS system. To date, more than 120 CCX Members range from corporations like Ford and Motorola, to state and municipalities such as Oakland and Chicago, to educational institutions such as Tufts University and University of Minnesota, to farmers and the Iowa Farm Bureau. CCX has an aggregate baseline of 226 million metric tons of CO2 equivalent, which is equal to the United Kingdom’s annual allocation under the EU ETS. This would make CCX one of the largest “countries” in the EU CO2 market, or 4% of U.S. annual GHG emissions.