IBC's 2021 Q2 Economic Outlook Survey Released
July 8, 2021
IBC Projects Positive Six-Month Economic Outlook
Survey Yields Optimistic Results for Fourth Straight Quarter
DES MOINES, IA – The Iowa Business Council (IBC) has released its second-quarter Economic Outlook Survey for 2021. The report measures member expectations for sales, capital spending and employment for the next six months. If the index measures above 50, sentiment is positive. The second-quarter survey's overall economic outlook index is 67.08. This marks the fourth positive quarter in a row, projecting continued confidence as the state rebounds from the pandemic. The index has not been this high since the second quarter of 2018.
Sales expectations for the next six months have risen 8.75 points to an index score of 71.25. Members also anticipate their company’s hiring levels will rise. The employment index rose 6.25 points to 68.75.
Capital spending projections have increased five points to an index score of 61.25 with the majority of respondents expecting higher or substantially higher investments in this category. This is a departure from last quarter’s results that indicated a wait-and-see approach as Iowa’s business community surpassed the one-year anniversary of the pandemic.
However, the survey also indicates that IBC members remain concerned about attracting and developing a talented and diverse workforce. 90 percent of respondents cited this issue as one of their top three primary business challenges. Additionally, 65 percent of respondents are concerned about the cost of product/service inputs (energy, raw material, sourcing). These results indicate Iowa businesses are not immune to the post-pandemic supply chain issues impacting the entire country.
"Receiving four consecutive quarters of positive index numbers is significant for the state’s economic outlook. This survey illustrates that demand for Iowa goods and services have rebounded quickly. As businesses across the state return to pre-pandemic outputs, leaders are understandably concerned about talent pipeline and supply chain issues,” explains Tim Yaggi, Chair of the Iowa Business Council.
“The 2021 legislative session delivered significant, bipartisan results on workforce housing, childcare and broadband that will drive innovation and business expansion across the state. However, we need more people to achieve our maximum potential. As we continue to look for ways to attract and retain a quality workforce, it is time to turn our attention to the federal immigration discussion. Iowa’s workforce shortage has never been more acute. That is why the IBC supports immigration reform that modernizes the system and expands visas in an effort to increase our population and business growth,” says Joe Murphy, Executive Director of the Iowa Business Council.
The Economic Outlook Survey has been completed by IBC members on a quarterly basis since 2004. The report provides insight regarding the projected trends for the state of Iowa, which can be used for business and economic planning. The reported trends have a state-wide impact, especially when considering that IBC companies have a presence in all 99 counties. To review previous Economic Outlook Surveys, please visit www.iowabusinesscouncil.org/news/eos.
About the Iowa Business Council
The Iowa Business Council (IBC) is a nonpartisan, nonprofit organization whose 22 members are the chief decision-makers of major Iowa employers. Employing over 172,000 Iowans, IBC member companies have invested billions of dollars of capital in Iowa's commercial infrastructure; lead the way in technology innovation, R&D, and grants procured; and are often the driving financial and volunteer forces behind philanthropic efforts all over the state.
IBC member companies include: Alliant Energy; Casey’s General Stores, Inc.; Collins Aerospace; Corteva Agriscience; Deere & Company; Fareway; HNI Corporation; Hy-Vee, Inc., Iowa Bankers Association; Kent Corporation; MercyOne; Meredith Corporation; MidAmerican Energy Company; Pella Corporation; Principal; Ruan Transportation Management Systems; The Weitz Company; The University of Iowa Health Care; UnityPoint Health; Vermeer Corporation; Wellmark Blue Cross Blue Shield of Iowa; and Wells Enterprises, Inc.