A Portrait of Iowa's
Labor Force
Iowa’s labor force grew by close to
200,000 workers since 1980, reaching an average of over 1,627,000 for
2004. However, the growth experienced during the past twenty-four years
falls far short of the over 330,500 workers that were added to the labor
force during the single decade of the 1970’s. The labor force grew rapidly
during the 1970’s as large numbers of females and baby boomers entered the
job market. Following the severe recession and farm crisis of the early
1980’s, the state’s labor force grew at a much slower pace. As labor
shortages began to surface for the first time during the 1994-1999 period,
employers were caught unaware and began to recognize the need to tap into
previously underutilized human resources. This labor supply consisted of
disabled individuals, immigrants, minorities and retirees.
During the 1990’s, the people of Iowa grew older and more diverse. By
2000, the median age for all Iowans had reached 36.6, the tenth-highest
median age in the nation. Thirty-eight counties had a median age of at
least 40. In addition, Iowa ranked fourth in the proportion of population
65 and over, and second in the proportion of population 85 and over.
The most dramatic change in the composition of the Iowa population during
the 1990’s was the migration of Hispanics into the state. Hispanics
accounted for more than a third of the state’s population growth during
the decade. There was a 152 percent increase in the Iowa Hispanic
population from 1990 to 2000, as large numbers of this ethnic group began
arriving in Iowa in the early 1990’s to work in the state’s meatpacking
plants.
Following the recession of the early 1990’s, Iowa enjoyed an expansion
that extended from 1993-2000. This was probably the most prosperous period
in the state’s recent history. Industry growth was broad-based, and
nonfarm employment peaked at a high of 1,478,500 in 2000. This period
ended abruptly in late 2000 with the onset of heavy layoffs in the state’s
manufacturing industry. The recession and terrorist attack of 2001 that
followed instilled a “bunker”mentality that proved to have a long-term
effect on hiring activity and business investment in the state.
The Iowa economy began to show improvement in mid-2003, but was not able
to achieve moderate, sustained job growth until the second half of 2004.
Preliminary nonfarm employment data for 2004 showed a job gain for the
first time in four years. The strongest gains occurred in finance, an
industry that is close to reaching the 100,000-employment level. Other
strong growth industries last year were education and health and
construction.
The long-awaited pickup in net job growth is expected to strengthen in
2005. There is evidence that the state’s businesses have started to expand
to the point where they need to add workers. In addition, manufacturers of
capital goods and industrial commodities should benefit from an increase
in exports.
Ann Wagner
January 19, 2005
