2022 Q1 Economic Outlook Survey
March 28, 2022
IBC Projects Positive Six-Month Economic Outlook
Optimism Levels Off as Workforce and Supply Chain Issues Persist
DES MOINES, IA – The Iowa Business Council (IBC) has released its first-quarter Economic Outlook Survey for 2022. The report measures member expectations for sales, capital spending and employment for the next six months. If the index measures above 50, sentiment is positive. The first-quarter survey's overall economic outlook index is 65.78. The solid results project confidence for the seventh quarter in a row. However, index numbers in each category dropped slightly amidst ongoing concerns pertaining to labor shortages, supply chain issues and costs of goods.
Sales expectations decreased 2.64 points from the fourth quarter’s findings to an index value of 69.73. Capital spending expectations also decreased by 2.64 points to 64.47.
The largest decrease occurred in the employment index. Expectations dropped 3.96 points to 63.15. While the score remains positive, the survey reflects an ongoing workforce frustration. The majority of respondents indicate that hiring remains a top concern, with 68% declaring the process is difficult or very difficult. Members report more than 10,000 current openings across the state.
When asked about primary business challenges, leaders ranked attracting/developing/retaining a quality workforce first amongst their concerns (84%). Unfavorable business climate (supply chain issues, infrastructure, regulations, taxes) ranked second (74%). Cost of product/service inputs ranked third (63%).
Supply chain conditions are not expected to change much in the next six months. A majority (79%) of respondents expect no change, while 15% anticipate improvements.
“While expectations have tempered slightly in the last quarter, Iowa companies remain optimistic about the future,” says Tim Yaggi, President & CEO of Pella Corporation and Chair of the Iowa Business Council. “Business leaders are monitoring global unrest, supply chain issues and workforce challenges, but generally expect robust demand.”
“The optimism our members have projected in this survey over the last seven quarters is a testament to Iowa’s resiliency. We have managed the post-COVID recovery well and that is reflected in the cautiously optimistic results of the first-quarter findings,” explains Iowa Business Council Executive Director Joe Murphy.
The Economic Outlook Survey has been completed by IBC members on a quarterly basis since 2004. The report provides insight regarding the projected trends for the state of Iowa, which can be used for business and economic planning. The reported trends have a state-wide impact, especially when considering that IBC companies have a presence in all 99 counties. To review previous Economic Outlook Surveys, please visit www.iowabusinesscouncil.org.
About the Iowa Business Council
The Iowa Business Council (IBC) is a nonpartisan, nonprofit organization whose 22 members are the chief decision makers of major Iowa employers. Employing over 190,000 Iowans, IBC member companies have invested billions of dollars of capital in Iowa's commercial infrastructure; lead the way in technology innovation, R&D, and grants procured; and are often the driving financial and volunteer forces behind philanthropic efforts all over the state.
IBC member companies include: Alliant Energy; Casey’s General Stores, Inc.; Collins Aerospace; Corteva Agriscience; Deere & Company; Fareway; HNI Corporation; Hy-Vee, Inc., Iowa Bankers Association; Kent Corporation; MercyOne; Dotdash Meredith; MidAmerican Energy Company; Pella Corporation; Principal; Ruan Transportation Management Systems; The Weitz Company; The University of Iowa Health Care; UnityPoint Health; Vermeer Corporation; Wellmark Blue Cross Blue Shield of Iowa; and Wells Enterprises, Inc.