Iowa’s economy — a tale of two recoveries

JOHNSTON - Assessing Iowans' economic well-being may be as simple as looking at their addresses.

Iowa's larger cities - Cedar Rapids, Des Moines and Iowa City, for example, 'are doing mostly well,” according to David Swenson, an economist who teaches at the University of Iowa and Iowa State University.

But the 'micropolitans” - communities of 10,000 to 50,000 population, such as Mason City and Clinton, 'collectively have not recovered to the levels of employment they had before the recession,” Swenson said during taping of Iowa Press Friday.

Overall, he said the Iowa economy 'looks pretty good,”

However, time and again he and Creighton University economist Ernie Goss said the strength and performance of Iowa's economy depends on one's address and occupation.

'It's getting a little bit better for manufacturers,” Goss said. 'Business and professional services, very good … health care, likewise … construction, particularly in urban areas of the state, doing well.” However, the ag and energy sectors as well as businesses tied to exports aren't doing as well.

'So it depends on which area you're in,” he said, adding there's an urban-rural split in the economy because along with agriculture, manufacturing and energy are part of Iowa's rural economy.

'So we have two recoveries … a healthy recovery and not a very good recovery going on in Iowa,” Swenson said. 'So it's not just the industrial area you're looking at, it's the geography that you're looking at as well.”

Neither economist predicted gloom. In fact, they see positive signs including a low unemployment rate and an expanding workforce. MidAmerican Energy's plans to invest $3.6 billion in wind energy production will create construction jobs, Swenson said, and the lower cost of energy may help Iowa attract manufacturing and other industries, Goss added.

However, Goss also warned that the higher value of the dollar makes it harder for Iowa companies to compete internationally. A greater concern, perhaps, is the attitude of presidential candidates toward trade, he said.

'If there's one thing they seem to agree on,” he said, is that trade is bad. 'We economists disagree with them, emphatically.

'I hear this, well see, look, what NAFTA did to us,” Goss said. 'No, look what NAFTA did for us. It really boosted the U.S. economy. It's perfect nonsense to listen to them.”

Goss also encouraged the president and Congress to move forward on the Trans-Pacific Partnership, which he said would be good 'not just for Iowa, not just for Nebraska, not just for Kansas and South Dakota, for the nation.”

'It's a heck of a good thing and we're hearing them, everybody is bashing it and that seems to get you votes. It should get you unelected,” according to Goss.

Like NAFTA, Swenson said the TPP could result in job loss. There are trade-offs, however in jobs and job value. Many jobs that didn't pay well or weren't going to pay well in a competitive market have been moved outside the United States. However, 'How many jobs, good jobs have we been able to maintain?”

It's easy to identify the losers, Goss said, but harder to seen the gain 'because that is more broadly dispersed.”

Iowa Press can be seen at 7 p.m. April 15 and noon April 17 on Iowa Public Television, at 8:30 a.m. April 16 on IPTV World and at www.IPTV.org.