Slow population growth adds to Iowa worker shortage concerns

As Iowa employers struggle to find people to fill jobs, the state’s long-term population trends are not encouraging, leaders of two statewide business groups told a state panel Tuesday.

“Every manufacturer we talk to, whether they're in Waverly or Waterloo or Clarinda, they say I can hire 40 people tomorrow,” Nicole Crain of the Iowa Association of Business and Industry told the Empower Rural Iowa Task Force.

It’s not just an Iowa problem. A Stateline news service analysis of federal statistics from August, the latest available, found 42 states with more jobs available than people looking for work. In Iowa, there are 1.4 openings for each unemployed person, the Stateline analysis found.

The problem is unlikely to go away anytime soon because of Iowa’s slow population growth, added Joe Murphy of the Iowa Business Council, which represents some of Iowa’s largest employers with a combined annual payroll of nearly $9 billion.

“A healthy state is a growing state,” he said. However, the 2020 census showed Iowa’s population growing about 4.7 percent compared with the national rate of 8 percent. Iowa’s five-year population change rate is an “anemic” 1 percent.

“That's a very concerning number for us as we think about the future of workforce and economic development,” Murphy told the panel, which is chaired by Iowa Lt. Gov. Adam Gregg.

Right now, Murphy said, more people are leaving Iowa than coming into the state. That’s one reason the Business Council is focused on federal immigration reform.

“We really think that a key to success for all of us moving forward is to promote reasonable immigration reform and modernization efforts,” Murphy said. “We know and many of your rural communities have embraced legal immigration as a pathway forward for economic development.”

ABI, which has 1,500 member companies with locations in all 99 Iowa counties, is working to help employers reach out to immigrants and refugees from Afghanistan and elsewhere, Crain said.

To attract more people to Iowa and retain those here, Murphy and Crain urged the panel to address the needs for better broadband connectivity, child care resources and workforce housing.

The Business Council believe housing can be an economic catalyst for growth, Murphy said. “Looking at ways in which we can grow that population density — not just in the urban centers — is key to our long-term growth strategies.”

In its marketing to attract people to Iowa, Murphy said, the council focused on safe neighborhoods, strong schools and little or no commute times to get to work.

“Living in Iowa is easy compared to a lot of other places that are high-cost,” Murphy said. “This is the state that you can live the life that you've actually always dreamed of living … the cost of living, the affordable housing, the ease of entry into the workforce, the ease of entry into community projects. This is where we can you can really make a name for yourself.”

Programs the state has initiated are helping businesses and communities across Iowa, according to Crain. Noting that Iowa has the largest percentage of working women and two-parent households in the workforce, she said state resources have helped create some successful child care programs in conjunction with employers.

She also highlighted the impact the Manufacturing 4.0 initiative can have on attracting skilled workers and retaining Iowa companies that might consider a move if they can’t fill job slots. The initiative, focused on advanced technologies, and grants are helping companies in Bremer and Jackson counties consider implementing robotics, upskilling employees and staying in rural Iowa.

Modernizing manufacturing processes “also helps our manufacturers meet their economic potential,” Gregg said, “because rather than having jobs just remain unfilled, we have the ability to automate some of those processes.”

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