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In 1971, McDonald’s settled its global headquarters in Oak Brook, a Chicago suburb with fewer than 8,000 people. Over time, Oak Brook’s identity became closely linked with the fast food chain, which brought jobs, resources, and infrastructure to the town.
But in 2016, the company announced that it would move to downtown Chicago. A 608,000-square-foot building will be built on the site of Oprah Winfrey’s former Harpo Studios by 2018.
The relocation worries a number of employees and residents who rely on the company for their income, according to a new report from the Washington Post’s Jonathan O’Connell.
Approximately 3,000 people in Oak Brook work for McDonald’s, the town’s second top employer. The fast food giant also currently donates $100,000 to the town annually (though the town doesn’t tax McDonald’s buildings), and community groups use some McDonald’s property. The United Soccer Academy, for example, uses a vacant green space for youth soccer practices and games, according to The Chicago Tribune. Other local companies, like the Fuller Service Center and Phillip’s Flowers, rely on McDonald’s corporate employees for some of its business.
To keep their jobs, Oak Brook’s McDonald’s employees will need to commute or move to Chicago, located 20 miles away. That’s not a long way, but some of the suburb’s residents may not want to follow the company downtown.
McDonald’s relocation could have an economic impact on Oak Brook, as evidenced by other large companies that have left the suburbs for the city.
A number of ExxonMobil employees in Fairfax County, Virginia reportedly lost jobs, after the oil company moved its Mobil Gas headquarters to Houston in 2015. In May 2017, GE broke ground on its new corporate headquarters in Boston, after it abandoned suburban Fairfield, Connecticut (its home of 42 years) due to disputes about the state’s corporate tax policy. Albert Kleban, the chairman of Kleban Properties, the largest commercial property owner in town, told The New York Times that the sudden surplus of workers’ homes up for sales could hurt real estate values in the town.
McDonald’s may not be chasing lower employee wages or property taxes – cities tend to have higher minimum wages than suburbs. Instead, it’s probably looking for workers who are more tech-savvy, because these people tend to want to work in cities, according to the Post. It will join a number of other suburban companies that have moved to cities, from Kraft Heinz to telecommunications firm Motorola Solutions.
“We are a brand on the move in more ways than one,” McDonald’s CEO Steve Easterbrook said in a press release. “Moving our headquarters to Chicago is another significant step in our journey to build a better McDonald’s. This world-class environment will continue to drive business momentum by getting us even closer to customers, encouraging innovation, and ensuring great talent is excited about where they work.”