Iowa gets mixed marks in manufacturing study

A new study ranks Iowa high among other states for the health of its manufacturing industry, but gives the state low marks for its tax climate and level of international trade.

The 2016 Manufacturing and Logistics Report Card, prepared by Ball State University's Center for Business and Economic Research, gives Iowa an A for the health of its manufacturing industry. The study looked at the share of total income earned by manufacturing employees in each state, the wage premium paid to manufacturing workers relative to the other states' employees, and the share of manufacturing employment per capita.

In the area of manufacturing logistics, Iowa received a B. To measure the health of the logistics industry, the study included the share of total logistics industry income as a share of total state income, and the employment per capita. It also included how commodities move by rail and roads as well as how much is spent by the state per capita on highway construction.

Iowa received a B-plus for human capital. The study included rankings of educational attainment at the high school and collegiate level, the first-year retention rate of adults in community and technical colleges, the number of associates degrees awarded annually, and the share of adults enrolled in adult basic education.

Iowa was given a D minus for its tax climate and received a D for the global reach of its manufacturing sector.

To measure tax climate, Ball State researchers used data on corporate taxes, income and sales and use taxes, as well as property and unemployment insurance tax data. To measure global reach, researchers examined data on exported manufacturing goods and the growth of manufacturing exports.

The study also included the amount of manufacturing income received annually from foreign-owned firms, the level of adaptability of the state's exporters to changing demand, and the reach of foreign direct investment.