Infrastructure, Health Care, Education Lead Iowa to No. 1 Best States Ranking

i_love_iowa_postcard-re95b444b63d748dbb045ffbfcaa6f4db_vgbaq_8byvr_324The following article was originally posted on February 27, 2018 via U.S. News and World Report.

There’s more to the Hawkeye State than corn and presidential primaries, the Best States rankings show.

By Jeff Charis-Carlson, Contributor

IOWA CITY, Iowa–Iowa may be better known for its corn, caucuses and creative writing programs, but the Hawkeye state also leads the nation in efforts to bring ultra-fast internet access to every city block and every rural acre.

Iowa’s No. 1 rankings in the infrastructure category and the broadband access metric within that came as a “pleasant surprise” to David Daack, a broadband consultant for Connected Nation, which does business in the state as Connect Iowa. Previous data reports have shown Iowa more in the middle of the pack.

“When people think of Iowa, they usually think of agricultural places that won’t necessarily need to be connected,” Daack says. “But given the big data needs of agriculture today and in the future, those areas are going to need to be every bit as connected as the urban areas. … You could almost argue that maybe we should go (to the farms) first and work our way back into the cities.”

Combine those No. 1s with Iowa’s Top 10 rankings in health care (No. 3), opportunity(No. 4), education (No. 5) and quality of life(No. 9), and the state becomes “first in the nation” not only in terms of its presidential caucuses, but also when describing Iowa’s overall placement in the U.S. News & World Report’s Best States rankings.

“We’ve been basically working within this model since 2011, and as you can see by the results in so many indexes, it’s working,” says Debi Durham, director of the Iowa Economic Development Authority.

This year, the Best States rankings feature a new category, quality of life. The rankings’ methodology for 2018 differs from that used in the 2017 rankings. In addition to adding the new category, metric-level data was updated to better reflect what is being measured. As a result, direct comparisons to a state’s performance from last year to this year may prove challenging.

The high index rankings, however, also include much lower sub-rankings that highlight the challenges facing Iowa as a slower-growing, aging state.

The state is ranked No. 17 for economy, and has Top 10 rankings for several of the factors used to calculate that metric: labor force participation (No. 10), labor force employment (No. 8) and gross domestic product growth (No. 6).

But the state ranks toward the bottom for business environment (No. 46) and for some of the other measures of economic strength: growth of the young population (No. 36), venture capital investment (No. 38) and entrepreneurship (No. 45).

“This is an area we really are going to be focusing in on over the next few years: both our competitive nature and also having more venture funding and growing that venture system within our state,” Durham says.

Although Iowa continues to be best known as a farm state, manufacturing has become its largest industry, and many rural areas benefit from the construction of new, large processing and production facilities well outside of city limits.

Yet Iowa’s other growing non-farm sectors – such as, health care, insurance and finance, biotechnology research and development – are the kinds of businesses found almost exclusively in metropolitan areas, says David Swenson, an economist with Iowa State University.

“It’s important to understand that the state can look great – especially if you’re sitting in Des Moines or Iowa City and you look around and say, ‘Geez, man, that just looks good here’ – but if you go to Clinton, or Keokuk or Ottumwa, it doesn’t look so good.”

Swenson cautions that Iowa’s low unemployment rate, a key part of the state’s economic ranking, does not necessarily mean that non-Iowans should have a “reasonably good expectation of getting hired” if they decide to move to Iowa.

“Iowa has historically had a low unemployment rate because, quite frankly, the nature of our economy doesn’t support a lot of slack in it,” Swenson says. “If you can’t find work where you are, then you move out, and you find some place where you can find work.”

A recent study co-led by Swenson found that between 2011 and 2015, Iowa’s greatest gain was workers under age 44 with only a high school diploma. The state’s biggest loss during the same period, however, was among workers with a four-year or advanced degree.

“We’re competitive in terms of attracting young people and people with lower education because that’s the nature of our workforce in agriculture and manufacturing,” Swenson says. “We have some high-quality, high-value services that we provide in the state of Iowa, but a lot of those can be obtained without having college degrees.”

Swenson also cautions against attributing the Iowa’s recent economic expansion to the change in political leadership within the state. Since 2010, Iowa has transformed from solidly purple into a state in which Republicans control the governor’s mansion, both houses of the state legislature, both seats in the U.S. Senate and three of the four seats in the U.S. House of Representatives.

“I really can’t point to any policy in the last five years that significantly, materially affected the state’s rate of growth – none whatsoever,” Swenson says. “Iowa’s economy depends on the rest of the United States’ demand for the stuff that we make here, so our economy basically grows in response to how well the nation’s economy is doing.”

Durham, who has been in her job since 2011, sees the labor numbers as illustrative of Iowans’ strong work ethic and evidence of how the state is moving in the right direction.

“The thing with unemployment is that Iowans work,” she says.

Durham touted the state’s Future Ready Iowa program, which has the goal of ensuring that 70 percent of Iowa’s workforce has education or training beyond high school by 2025.

She also pointed to a new rural initiative announced by Iowa Gov. Kim Reynolds during the recent Condition of the State address.

“Our goal: to keep and bring home Iowa’s sons and daughters and grow the next generation of community leaders,” Reynolds said during the speech.

The governor’s critics, however, point out that it is hard to be optimistic about such initiatives when the Republican-controlled Iowa Legislature is calling for further cuts from Iowa’s 15 community colleges and three public universities. For the second year in a row, state lawmakers are debating midyear cuts because of lower than projected state revenues.

Iowa is No. 1 in terms of the graduation rate for public high schools and is No. 3 for the graduation rate for four-year public colleges. Those scores helped the state rank No. 5 for education overall. It is No. 19 for tuition and fees, and No. 32 for low debt at graduation for in-state students at four-year institutions.

“The universities are going to rank relatively high because we are very, very good in this state at educating people,” Swenson says. “We’re just not so good at keeping them here.”

Iowa’s No. 3 ranking in health care is based on Top 10 rankings in child wellness visits (No. 1), health care affordability (No. 2), low infant mortality rate (No. 2), Medicare quality (No. 3), insurance enrollment (No. 5), health care access (No. 5) and health care quality (No. 9). The state, however, ranks No. 37 for obesity.

“We are a little bit higher in health care because we have an older population, so we have more spending on health care per capita as well,” Swenson says.

Iowa’s No. 4 ranking in opportunity comes largely from its affordability (No. 3) – especially in terms of housing (No. 2). The state does rank slightly below average in terms of income gap by race (No. 27) and dips down further for income gap by gender (No. 40).

Despite Iowa’s No. 1 ranking, Daack says the state still has “a long road to go” to continue to lead the nation in all levels of broadband access, adoption and use. With each passing year, he says, lawmakers and other business leaders understand more clearly the importance of connecting the central, landlocked state with the rest of globe.

“Broadband’s impact is on everything,” Daack says. “Whether you are talking about bringing in large a manufacturing facility, developing new school programs, or attracting young people to the state, broadband is a key component.

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