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As Iowa’s participation in federal unemployment benefits ends, state officials have pointed to Iowa’s number of job postings — over 68,000 — as evidence for the need to stop payments.
“Today we have more job openings than we have people on unemployment,” Gov. Kim Reynolds said Wednesday in Coralville at the Iowa Association of Business and Industry’s annual conference.
Those job openings, however, are especially condensed in urban areas and not necessarily in industries that brought the most unemployment claims during the pandemic, according to a Gazette analysis of Iowa Workforce Development data.
Six counties — Polk, Linn, Johnson, Scott, Black Hawk and Dubuque — have more job openings than Iowa’s 93 other counties combined, as of Wednesday’s figures.
Those counties account for 40 percent of Iowa’s population.
The urban-rural difference is especially stark in Eastern Iowa. Linn County has 2,510 job openings per 100,000 people. But its neighbor to the east, Jones County, has only 914 job openings per 100,000 people, and its westerly neighbor Benton County has 717 per 100,000 people.
Dave Swenson, an Iowa State University economist, attributed the urban-rural gap to rural areas not relying as heavily on industries that were hit hard by the pandemic.
“Dining, drinking, those kinds of things, they’re not a mainstay of rural economies,” Swenson noted.
Now many of the sectors that disproportionately hit urban areas are recovering, he added during a phone interview.
Manufacturing and construction usually have been two of the largest sources of new unemployment claims each week in Iowa. But those sectors have a relatively small chunk of the 68,295 job openings advertised as of Wednesday afternoon.
Manufacturing accounts for about 6.6 percent of job openings, and construction comes in at 1.9 percent.
Twenty-five counties had five or fewer manufacturing job postings, and 64 counties had five or fewer construction job postings.
Health care and social assistance, on the other hand, was another large source of unemployment claims and had a large share of job openings — about 17 percent.
“That demand will remain strong for many years” as baby boomers age, Swenson said.
About a quarter of health care and social assistance job postings are in Polk and Linn counties, the two most-populated counties in the state. The 2,869 combined job postings between those counties is more than 77 other counties in Iowa combined.
“There has been a systematic shift in employment away from non-metro to metro in the health care sector,” Swenson said.
Some Republicans and business groups have expressed optimism that the cutoff in federal unemployment benefits will help fill some of the state’s advertised job openings.
State Sen. Waylon Brown, R-Osage, said axing the extra $300 per week from Federal Pandemic Unemployment Compensation is “one of the things” necessary to “to get the economy back up and going and get people back into that workforce.”
“When you look at the amount of jobs that are out there right now — it may not be in the field that you would like to be working in, but there are plenty of jobs out there,” Brown said.
A May survey by the Iowa Restaurant Association indicated almost 90 percent of restaurant operators believed the federal unemployment programs was the “primary reason” for challenges hiring enough staff.
But state Sen. Bill Dotzler, D-Waterloo, described the cutoff of benefits as a “major mistake.”
“The worker shortage in Iowa doesn’t have to do with people sitting at home collecting unemployment benefits,” Dotzler said. “The real issue is we don’t have enough workers in Iowa and the policies are driving more and more talented, educated people out of this state.”
Swenson also is skeptical of the idea that stopping the federal benefits could help Iowa businesses.
“That’s not going to have any impact on the number of job postings,” Swenson said.
He actually expects Reynolds’ decision to have the opposite effect on Iowa’s economy.
“That’s a lot of money that would’ve been consumed in our economy,” Swenson said. “It will lower the level of household consumption, lower the demand for goods and services over that few months that they've cut this out and it will have a negative economic effect on the overall economy.”
The Gazette’s Rod Boshart and Rylee Wilson contributed to this report.
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