Broadband Expansion, Population Growth Key Goals Outlined in Iowa Business Council’s Annual Dashboard

February 3, 2021

Michael Crumb, Business Record

Iowa is strongly positioned to compete with other states in 2021, according to indicators measured by the Iowa Business Council’s annual Competitive Dashboard report released today.

The dashboard looks at data in five categories: economic growth, education and workforce, governance, health and wellness, and demographics and diversity. Each category consists of five metrics used to determine Iowa’s performance compared with other states.

The report also contains recommendations officials with the IBC said can be used as a road map for the future.

“Ultimately we want this report to be both a guide and tool for lawmakers, businesses and community leaders when determining policies and pursuing efforts to make Iowa more competitive,” said Joe Murphy, the IBC’s executive director.

Iowa was competitive in all areas, but officials with the IBC said there were key priorities that the state needs to focus on in the year ahead.

Probably the highest priority is expanding broadband infrastructure statewide, which ties into Gov. Kim Reynolds’ proposal to allocate $450 million to expand high-speed internet statewide by 2025.

Another priority is to increase the state’s population.

Tim Yaggi, the group’s chair, said the expansion of broadband can be one tool used to help draw more people to Iowa. Yaggi is president and CEO of Pella Corp.

“Remote work was forced, given the risks around the pandemic, and it has worked in many cases better than we all anticipated,” Yaggi said. “I think people are now more interested because they can work from home and go out from city centers. Certainly in Iowa … relative to many of these high-cost states, we’re much more affordable. We think it is an area of opportunity where we can attract people who can work from Iowa even if they are working for a company based in a high-cost area.”

Yaggi said that broadband is an issue that the state can work on almost immediately, but that the issue of population growth would be a longer-term fix for Iowa.

“We are constantly, consistently trailing the national average on population, and for us to be a healthy state, we need to be a growing state,” Yaggi said. “For our businesses to grow and be vibrant, we need to attract and retain the people we need to facilitate that growth.”

Yaggi said with that growth will come diversity, ”which I think will be important as well.”

This year’s report showed for the first time since the IBC started issuing the dashboard in 2011 that the state’s population has declined.

“It's bordering on a crisis,” Murphy said. “If people continue to leave the state, if people continue to not move into the state, that is going to put us in a very difficult situation.”

He said it’s incumbent on business leaders to create a “welcoming and inclusive front” for the state and “lay out a welcome mat” here in Iowa.

More needs to be done on immigration reform, and the IBC is set to “tee up a statewide marketing campaign we’re just in the beginning stages of reorganizing given the pandemic year last year.”

“But … we have wonderful schools, we have safe communities, we have low or zero commute times now, there’s a number of things we can take advantage of with respect to bringing in new Iowans to our state that I think can set us up for future growth and success,” Murphy said.

He said the dashboard does not give a complete picture of the effect of the pandemic because some of the data collected during 2020 represents 2019 performance. Next year’s report will likely give a clearer picture of those effects, but Murphy said the dashboard is intended to look at long-term trends and not just the immediate picture.

“This is a snapshot in time for how Iowa compares to the rest of the country,” he said. “We have a great understanding of the ebbs and flows, and some of the metrics we use to identify trends and opportunities that our recommendations are based on.”

He said that while broadband and population growth are key workforce development goals, the report showcases that “our priorities really touch on all these challenges and indicators and … generational issues that will keep Iowa moving in the right direction.”

Looking at specific metrics within the report, you’ll see:

Iowa’s gross state product rose to $194.7 billion in 2020, but the state remains ranked  No. 30 in the country.

Iowa slipped to No. 6 in the the value of manufacturing as a percentage of GSP, at 17.4%. That is down from No. 4 in 2019.

Iowa ranked No.1 in labor force participation at 71%.

Iowa slipped slightly in proficiency in both fourth grade reading and eighth grade math, but rose slightly in high school attainment.

In a new category of work-based learning in high schools, Iowa has 121 schools participating.

Iowa ranked No. 46 in corporate tax index and No. 40 in individual tax index.

The state’s population dropped slightly in 2020 with a net out-migration of 2,348, but remained unchanged in ranking No. 30 compared with other states.

Despite a drop in population in 2020, the state’s five-year average showed growth of 1.1%, down from a five-year average of 2% in 2019. The change dropped Iowa’s rank in the metric to 27 nationwide.

Iowa remained ranked No. 45 in the ethnic diversity of its population, despite seeing slight improvement in that number. The report showed that 14.9% of the state’s population is ethnically diverse.

Based on the report, here are some of the IBC’s recommendations:

Substantial investment is needed to improve broadband infrastructure and bolster connectivity, especially in rural parts of the state.

Increase investment in the State Housing Trust Fund and Workforce Housing Tax Credit programs. State and community leaders should work together to develop a collaborative statewide strategy to meet Iowa’s workforce housing needs.

Continue to advocate for the Future Ready Iowa initiative and to fund the Last Dollar Scholarship and Employer Innovation Fund to help upskill the current workforce into high-demand jobs.

Develop and implement scalable, sustainable solutions to provide work-based learning opportunities for all students.

Continue to advance strategies that address child care availability in Iowa.

Continue efforts to make Iowa’s tax code more competitive for all taxpayers

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