Business council: Iowa faces worst worker shortage but businesses bullish on economy
Iowa faces a worker shortage that makes recreational offerings more important, a business group says. (Photo by Perry Beeman, Iowa Capital Dispatch)
“Companies are really at a tipping point with respect to their workforce,” council Executive Director Joe Murphy said in an interview. “They need people more than ever.”
Workforce shortages and trouble getting supplies have made it difficult for businesses to meet demands that have accelerated since the pandemic, Murphy said. “… There is so much money flowing in the economy right now. So much pent-up demand. We’ve never really seen anything like that and it’s been extremely difficult for companies to basically meet that,” he said.
The council, which praised lawmakers for progress last session on child care, workforce and broadband access issues, plans to push for federal immigration law changes and for alterations in the state’s corporate tax code to help draw workers to the state. Improving recreation also will be important, Murphy said.
Despite the challenges, business council members were more positive than they’ve been at any time in the past three years.
The survey of Iowa’s largest employers came up with an overall economic outlook index of 67.08. Anything above 50 is considered a positive sign.
The index landed in positive territory for the fourth quarter in a row as the economy recovers from a recession at the beginning of the coronavirus pandemic in early 2020.
The nonpartisan council’s members include some of Iowa’s largest employers, among them Pella Corp., the investor-owned utilities, Casey’s, Principal Financial Group, Corteva and Deere & Co.
Highlights of the latest survey:
— Sales projections for the next six months rose 8.75 points to 71.25.
— Most members expected to hire more staff the rest of the year, with the index rising 6.25 points to 68.75.
— The capital spending score was up 5 points at 61.25. Most respondents said they expect “substantially higher” investments, showing strengthening prospects in the weeks following the one-year anniversary of the pandemic.
— Workforce issues continued to challenge operations, with 90% of respondents listing them as a top issue.
— Costs of materials were a concern for 65% of respondents.
Tim Yaggi, business council chairman, in a statement said a streak of four positive quarters is “significant.”
“This survey illustrates that demand for Iowa goods and services has rebounded quickly,” Yaggi said. “As businesses across the state return to pre-pandemic outputs, leaders are understandably concerned about talent pipeline and supply chain issues.”
The survey has been conducted quarterly since 2004.
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