Issued Friday, Jan. 24, 2020
IOWA CITY, Iowa (Jan. 24, 2020) — Iowa payroll jobs dropped for the second straight month and the unemployment rose to 2.7 percent in December amid troubling long-term trends.
The nonpartisan Iowa Policy Project released this statement from executive director Mike Owen about the preliminary December numbers reported Friday by Iowa Workforce Development.
“The year 2019 was not a good one for Iowa jobs. There is no getting around it. We are looking at an actual net decline in payroll jobs over a year, something Iowa has not experienced since the last recession.
“It is unclear how long people will pretend that the economy is stronger than it is. This goes far beyond two consecutive months of job drops, which are concerning enough. If the preliminary December numbers stand, Iowa was down 2,400 over the calendar year.
“As recently as July, Governor Kim Reynolds was promoting the June unemployment rate of 2.4 percent as evidence backing her agenda of tax cuts and policies more friendly to business owners than to employees. As we suggested then, her comments were premature at best. Now, the unemployment rate has bumped up to 2.7 percent in six months, and jobs are fewer.
“It is fair to note these latest numbers may be revised — all the more reason to take the longer view in setting policy to assist the Iowa economy.
“The challenge for our policy makers is to make the investments necessary to reverse the net job losses being reported for 2019 and to offer fresh opportunities for Iowans. Unfortunately, tax cuts at the expense of anything else is the order of the day in Des Moines. It's not working.”
The Iowa Policy Project (IPP) is a nonpartisan, nonprofit public policy research and analysis organization based in Iowa City. IPP has been tracking Iowa job trends since its founding in 2001 and has regularly provided reflections on official monthly job reports since 2003.
• Nonfarm jobs dropped by 3,100 to 1,591,000, the second straight monthly drop.
• Iowa's unemployment rate rose to 2.7 percent, up from 2.6 percent in November and 2.4 percent the previous December.
• Four of the 11 major job categories showed gains in December, and seven showed declines. Construction at 1,500 and leisure and hospitality at 1,200 were the largest increases.
• Manufacturing, down 1,400, showed the largest decline in the month, followed by trade and transportation, and professional and business services, at 1,200 each.
• Through 2019, nonfarm jobs averaged a 200-job monthly decline. Though there were declines in only four of the 12 months, they outweighed the smaller increases in other months.
• The year was the first since 2009 with a net drop in payroll or nonfarm jobs. Jobs dropped by 1,100 in 2008 and 4,000 in 2009. If the preliminary December job numbers stand, for calendar 2019, Iowa lost 2,400 jobs.
• Over the year, construction jobs led gains at 4,500, followed by government at 2,000 and "other services" jobs at 1,500. Trade and transportation led declines at 3,300, followed by professional and business services at 2,900.
Iowa remains well off the pace of job growth needed for full recovery from the last recession, which ended in June 2009. Analysis by the Economic Policy Institute shows Iowa needed a net increase of 112,900 jobs since December 2007, the start of that recession, to keep up with the population growth of 7.4 percent since that time. Jobs have grown only by 65,700, leaving a job deficit of 47,200.