The future of climate resilience in an uncertain world: Chicago’s opportunity to lead

Key takeaways:

• Chicago, and the broader Midwest, will be a destination for domestic and international climate migrants and a relocation of commercial activity, which comes with opportunities and challenges
• Business leaders should consider environmental resilience and access to fresh water as additional criteria when selecting office locations, in addition to workforce, weather, cost of living, etc. Business leaders in Chicago should consider pre-competitive strategies to improve resilient infrastructure and workforce readiness
• City planners need to ensure infrastructure (e.g., water management) and workforce readiness for Chicago to fully embrace its leadership potential and enhance Chicago’s regional and national leadership

Climate shocks will intensify globally, businesses should prepare locally

In 2023, the U.S. faced a record 28 weather and climate disasters, each resulting in losses over $1 billion. With 22 such events in 2020 and only 5.7% per year throughout the 1990s, 2023 had the highest number of billion-dollar disasters in US history, highlighting a frightening reality for businesses: the climate crisis is no longer a distant concern, it’s an immediate business risk that could affect everything from financial health to operational resilience.

The intensifying climate shocks will cause many to move. It’s estimated that 1.2 billion people could be displaced globally by 2050 due to climate change and natural disasters.

Chicago will be a premier destination for climate migrants and refugees

Both Chicago and the greater Midwest have greater intrinsic climate resilience than other regions in the U.S., and as such will be a destination for millions of domestic and international climate migrants. Furthermore, it will be an increasingly attractive place to locate business operations to shelter from the climate shocks of other U.S. regions. Both the city and region are taking steps to prepare.

Chicago has already seen an influx of migrants due to climate change, including after Hurricane Katrina in 2005 and Hurricane Maria in 2017. A 2022 study found that Cook County was the seventh most desirable destination for climate-related moves in the U.S. As states across the country feel the impact of worsening climate shocks, a quarter of a million people have moved in search of a more stable environment.

The Midwest doesn’t face the same level of climate threats felt by coastal cities, however, Chicago will not be free of the impact of climate change. The challenges instead will focus on the amount and intensity of rainfall and localized floods, as well as urban heat events.

That being said, Chicago has a number of competitive advantages as corporations and people seek to move to a more habitable place to put down roots:

• Strong and large pool of workforce. Chicago is far ahead of its peers in the Midwest with its total number of unskilled and skilled workforce available to meet the dynamic needs of corporations across a broad range of industries and sectors
• Ample freshwater supply. The Great Lakes provide ample freshwater for drinking, industry, and leisure
• Temperate climate band. As the most important region for national food supply, the Midwest will have a comfortable climate and sufficient water to support waves of crops and ensure access to food
• Shelter from extreme weather events. The city will remain generally safe from disastrous weather events such as hurricanes, wildfires, and extreme heat waves
• Housing and infrastructure advantages. Chicago continues to be differentiated in its relative affordability and being a national transportation hub. However, its income and property tax policies will need consideration to be competitive with other regional cities
• History with integrating immigrants. Few cities have had the history of successfully welcoming and integrating millions of immigrants into the economic and cultural fabric of the city
• Energy Transition policy framework. Illinois has taken a posture of climate leadership to accelerate the energy transition, provide incentives and credits to businesses and consumers, and ready its workforce for the energy transition 

The evaluation of this expanded set of variables will impact decisions for families as well as businesses. No longer will affordability, warm weather, workforce availability be the top drivers of where corporates select where and how they operate. In fact, Climate resilience is expected to top the selection criteria list by 2032.

Illinois’s efforts to accelerate the energy transition

Regarding the current policy context, Chicago and Illinois are also bolstered by their commitment to the energy transition with the passing of CEJA, the Climate & Equitable Jobs Act, which the Illinois General Assembly passed in 2021. If implemented effectively, this law could be a national model on how states can fight the most devastating and expensive consequences of climate change while controlling costs for energy customers. Other elements of CEJA include:

• Moves Illinois to 100% carbon-free power by 2045
• Expands energy efficiency and other cost-saving opportunities for customers
• Launches an expansion of cleaner, more affordable transportation options

Chicago also has its Climate Action Plan (CAP), which sets goals and strategies to reduce the city’s greenhouse gas emissions overall by 62% by 2040.

Where policymakers still need to address gaps are with the city’s readiness from an infrastructure lens, especially with stormwater and drinking water infrastructure.

Chicago can leverage its history of innovation and visionary thinking

Chicago has one of the richest immigration histories of any American city. In 1870 immigrants made up the larger proportion of the city’s population, estimated at 48%, which was greater than any other city in North America. This will be one of its strengths as it looks to redefine what it means to be a destination city for migrants and stop the reversal of people leaving the state.

Let us also remember Chicago’s tradition of innovation, whether it was after the Great Fire of 1871 and its ability to re-invent itself, Chicago can, will, and must be a leader for the transition to a resilient and regenerative economy.

Key actions for leaders in Chicago to promote a resilient and growth-oriented future:

• For business leaders. Business leaders must assess resilience plans in their operational footprint both domestically and in Chicago. Understand the competitive pressures that will define decisions for locations across their operations and portfolios, as well as their upstream suppliers. Integrating climate risk into enterprise planning will be critical (and leverage the TCFD as a reporting framework to do so). Consider forms of localized pre-competitive collaboration to levelized the playing field on Sustainability and Resilience priorities (e.g., infrastructure, workforce readiness, etc.) as well as shared advocacy objectives. Finally, increase the resilience of your built environment portfolio to both acute and climate shocks and chronic stressors
• For City Council members. Advocate for more rigorous benchmarking of Chicago’s competitiveness compared to other midwestern cities to become the leader amongst climate resilient cities. Prioritize integration of climate risk assessment into other operational and financial risk management systems. Vote for financial appropriations that improve Chicago’s leadership in resilient infrastructure
• For city planners and policymakers. Chicago and other cities in the Great Lakes region should prepare by investing in upgrades to their stormwater and drinking water infrastructure and deploying nature-based solutions to improve resilience. Furthermore, Chicago’s 2022 Climate Action Plan emphasizes efforts to reduce carbon emissions, advance environmental justice and improve community health, but makes no specific mention of climate migration and receiving migrants. Update strategies for integration and support of all left-behind and lower-income communities and environmental justice programs to think holistically about all facets of Chicago’s population (safety, health, equity, and economic wellbeing). Extend climate protections and energy efficiency provisions to consensus-based building codes
• For educators. Integrate climate curriculum across educational institutions to promote workforce readiness in jobs related to the energy transition and resilient, green infrastructure renewal