IBC's 2021 Q4 Economic Outlook Survey Released
January 6, 2022
IBC Projects Positive Six-Month Economic Outlook
Survey Yields the Most Optimistic Results Since 2018
DES MOINES, IA – The Iowa Business Council (IBC) has released its fourth-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 fourth-quarter survey's overall economic outlook index is 68.86. In addition to being the sixth positive quarter in a row, it is also the highest index score since the second quarter of 2018. This strong showing projects continued confidence in the state’s pandemic recovery efforts.
Sales expectations increased 2.37 points from the third quarter’s findings to an index value of 72.37. The largest area of improvement can be found in capital spending where the index increased by 7.11 points to a score of 67.11.
The employment index increased by .86 to a score of 67.11. While the score suggests some optimism amongst members, the majority of respondents indicate that hiring remains a top concern, with 74% reporting that hiring is difficult or very difficult. Members report more than 14,950 current openings across the state.
When asked about primary business challenges, leaders ranked Attracting/developing/retaining a quality workforce first amongst their concerns. Cost of product/service inputs ranked second. Unfavorable business climate (COVID, infrastructure, regulations, taxes) ranked third.
Supply chain conditions are not expected to change much in the next six months. A majority (79%) of respondents expect no change, while 21% anticipate improvements.
“The latest index numbers project optimism for the first half of 2022. However, we are not out of the woods yet. Talent pipeline issues continue to be the number one concern amongst our members,” says Tim Yaggi, President & CEO of Pella Corporation and Chair of the Iowa Business Council. “With attraction and retention of employees in mind, the IBC is focused on child care, competitive tax policy, availability of housing and workforce development during the upcoming legislative session.”
“As company leaders look toward the next six months, 63% forecast their employment levels will be higher to substantially higher. However, the talent has to come from somewhere. That is why our 2022 legislative agenda focuses on areas that improve the workforce across Iowa,” explains IBC Executive Director Joe Murphy. “Unfortunately, two-thirds of Iowa counties hit their population peak by 1950. The inability to fill jobs due to the talent shortage will cause our economy to suffer. If we want employers to remain in our state, we must aggressively grow our population throughout Iowa. At the federal level, immigration should play an important role in our future workforce strategies.”
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. One in six jobs in Iowa are tied to an IBC company. 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: Ruan Transportation Management Systems; Vermeer Corporation; Iowa Bankers Association; Alliant Energy; Casey’s General Stores, Inc.; Collins Aerospace; Corteva Agriscience; Deere & Company; Fareway Stores, Inc.; HNI Corporation; Hy-Vee, Inc., Kent Corporation; Mercy Health Network; Meredith Corporation; MidAmerican Energy Company; Pella Corporation; Principal; The Weitz Company; The University of Iowa Health Care; UnityPoint Health; Wellmark Blue Cross Blue Shield of Iowa; and Wells Enterprises, Inc.