State Farm to slash nearly 900 IT jobs in Illinois

State Farm to slash nearly 900 IT jobs in Illinois

The insurer will downsize its IT division in Bloomington while adding tech jobs in other states.

As part of a restructuring project previously hinted by the company, State Farm Insurance Co. announced March 6 that it would be eliminating 890 jobs from its information technology division in Bloomington, Illinois, the site of the firm’s corporate headquarters.

The insurer will move 380 of the IT jobs to its Atlanta, Dallas and Phoenix locations, according to the Pantagraph. Phoenix will be the largest recipient of the tech jobs, gaining roughly 280 positions, while Dallas and Atlanta will see 70 and 30 new positions, respectively.

These cuts come as the latest phase of the company’s efforts to condense its three, separate IT departments into one integrated department. State Farm has referred to this reorganized division as its enterprise technology, or ET, department.

The Bloomington-based firm first indicated it’d be pursuing restructuring efforts in September 2017. However, the March 6 shakeup marks the process’s first major development. State Farm is by far Bloomington-Normal’s largest employer.

In a statement accompanying the March 6 announcement, the company insisted the size of its workforce in Bloomington-Normal would remain stable, noting that while it will undergo a reduction in tech staff, other departments will see a growth in personnel. Three hundred claims division jobs will reportedly be added in Bloomington as part of the workforce overhaul.

“The overall State Farm Bloomington workforce will remain at around 15,000 employees, as hundreds of employees move in and out of the company’s Bloomington facilities every year,” the company’s statement said, according to the Pantagraph. The statement noted that while IT staff will shrink, gains in the claims department and others will largely offset the losses.

But Illinois lawmakers ought to be cautious. Although the insurer has pledged to maintain the size of its Bloomington workforce, its operations in other locations have enjoyed an expansion in recent years. Two years after the General Assembly passed the 2011 tax hikes, the insurance group expanded the scope of its facilities in north Texas cities Richardson and Irving, as noted by the nonpartisan Tax Foundation. The Dallas, Atlanta and Phoenix metro areas have also been sites of State Farm’s expansion efforts since 2013.

Traditionally, Illinois has asserted itself as one of the most attractive options in the country for companies’ corporate headquarters. But some employers’ activity in recent months has sent troubling signals about Illinois’ business climate. Lawmakers should take proactive steps toward sound spending reforms that would allow tax rates to shrink – and businesses to grow.

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