Release Date: 03/ 01/ 2005
CONTACT: Dave Brasher, (515) 243-4723 or Kevin Walter, (614) 221-4107
Survey Shows Iowa Better Off than Many Neighboring States
IOWA -- Iowa's overall business climate and potential for future growth is superior to several other Midwestern states but not as healthy as it could be when viewed from a national perspective, according to the inaugural Iowa Small-Business ConditionsSM report. The new report's data, which was released today by the National Federation of Independent Business/Iowa, provides an overview of small-business conditions within Iowa and compares them with neighboring states.
"Iowa small-business owners clearly view their business climate in a much more positive light than their counterparts across the river in Illinois as well as those in Michigan, Indiana and Ohio," said Dave Brasher, NFIB/Iowa state director. "And, within our own immediate, highly competitive region, we stack up quite nicely against Wisconsin, Missouri and Minnesota."
The poll shows 37 percent of the state's small employers believed business conditions in their market area are good. They also saw those conditions improving. A net 61 percent characterized the outlook for business over the next three months as good, citing sales prospects and increased productivity as the key reasons for their view. Thirty-three percent see Iowa's overall business environment as "supportive" of small business compared to just 16 percent in Illinois.
"While we can take some comfort in knowing we are better off than some of our neighbors, it must also be noted that many states, particularly in the southeast, show far better performance than Iowa," said Brasher.
Of those surveyed in Iowa, a net 29 percent indicated that profits were "good," and a net 44 percent of those same respondents characterized sales as "good," both high numbers in the region. Iowa also is enjoying the lowest average regional price increases, with a net 50 percent of small employers reporting that over the last three months their purchasing prices rose. A net 14 percent reported they had increased selling prices, again the best in the region.
Fifteen percent noted they had "one or more" current job openings. Over the same three-month period, 46 percent of small-business owners made capital expenditures. While 41 percent of the respondents reported spending on technology upgrades, the number of owners making expenditures for employee training was 37 percent.
When asked to rank their most important business problem, Iowa small-business owners ranked insurance as the most serious of them all. Adding some more positive news, 71 percent of small-business owners said they were "satisfied" (60 percent) or "very satisfied" (11 percent) with the direction Iowa is headed.
The Small-Business ConditionsSM reports are developed from surveys of small-business owners in selected states. The surveys are designed to determine the condition of the small-business economy in each particular state. The surveys are conducted every three months and results are released on the first day of the month following completion. For information about the Small-Business ConditionsSM project and other small-business research studies conducted by the NFIB Research Foundation, visit www.NFIB.com/research.
| Iowa Small-Business ConditionsSM | ||||||
| This chart shows the results from Iowa and its comparative standing among selected nearby states. | ||||||
| Iowa | Ill. | Minn. | Mo. | Wis. | ||
| Business Climate | Survey Date | |||||
| Overall state business environment | ||||||
| Net % supportive of small business | 2/2005 | 33 | 16 | 27 | 30 | 22 |
| Prior qtr. | - | - | - | - | - | |
| Business conditions in market area | ||||||
| Net % "good" | 2/2005 | 37 | 29 | 38 | 43 | 33 |
| Prior qtr. | - | - | - | - | - | |
| Net % "improving" | 2/2005 | 15 | 14 | 12 | 21 | 10 |
| Prior qtr. | - | - | - | - | - | |
| Outlook for business | ||||||
| Net % "good" in next three months | 2/2005 | 61 | 59 | 63 | 70 | 66 |
| Prior qtr. | - | - | - | - | - | |
| Reason for optimism | ||||||
| % Sales prospects | 2/2005 | 42 | 43 | 57 | 50 | 59 |
| Prior qtr. | - | - | - | - | - | |
| % Lower costs | 2/2005 | 3 | 3 | 2 | 2 | 1 |
| Prior qtr. | - | - | - | - | - | |
| % Price increases | 2/2005 | 4 | 3 | 3 | 4 | 5 |
| Prior qtr. | - | - | - | - | - | |
| % Greater productivity | 2/2005 | 16 | 13 | 15 | 15 | 12 |
| Prior qtr. | - | - | - | - | - | |
| % Government policy | 2/2005 | 5 | 5 | 3 | 5 | 3 |
| Prior qtr. | - | - | - | - | - | |
| Reason for pessimism | ||||||
| % Sales prospects | 2/2005 | 29 | 5 | 30 | 10 | 20 |
| Prior qtr. | - | - | - | - | - | |
| % Cost increases | 2/2005 | 18 | 10 | 10 | 10 | 10 |
| Prior qtr. | - | - | - | - | - | |
| % Pressure on selling prices | 2/2005 | 0 | 10 | 5 | 0 | 10 |
| Prior qtr. | - | - | - | - | - | |
| % Lower productivity | 2/2005 | 6 | 10 | 0 | 0 | 5 |
| Prior qtr. | - | - | - | - | - | |
| % Government policies | 2/2005 | 6 | 15 | 25 | 50 | 30 |
| Prior qtr. | - | - | - | - | - | |
| Iowa | Ill. | Minn. | Mo. | Wis. | ||
| Sales and earnings (last quarter) | ||||||
| Sales | ||||||
| Net % sales "good" | 2/2005 | 44 | 22 | 27 | 39 | 37 |
| Prior qtr. | - | - | - | - | - | |
| Profits | ||||||
| Net % profits "good" | 2/2005 | 29 | 9 | 12 | 23 | 20 |
| Prior qtr. | - | - | - | - | - | |
| Employment | ||||||
| Current job openings (one or more) | ||||||
| % "Yes" | 2/2005 | 15 | 18 | 16 | 17 | 19 |
| Prior qtr. | - | - | - | - | - | |
| Per employee payroll cost | ||||||
| Net % "risen" | 2/2005 | 13 | 20 | 22 | 25 | 23 |
| Prior qtr. | - | - | - | - | - | |
| Employee cost pressures (greater) | ||||||
| % Wages | 2/2005 | 55 | 53 | 53 | 59 | 52 |
| Prior qtr. | - | - | - | - | - | |
| % Benefits | 2/2005 | 26 | 30 | 30 | 29 | 35 |
| Prior qtr. | - | - | - | - | - | |
| Iowa | Ill. | Minn. | Mo. | Wis. | ||
| Productivity | ||||||
| Upgraded technology/processes (last three months) | ||||||
| % "Yes" | 2/2005 | 41 | 43 | 46 | 39 | 46 |
| Prior qtr. | - | - | - | - | - | |
| Made capital expenditure(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 46 | 42 | 46 | 44 | 55 |
| Prior qtr. | - | - | - | - | - | |
| Made expenditure to train employee(s) (last three months) | ||||||
| % "Yes" | 2/2005 | 37 | 43 | 47 | 38 | 43 |
| Prior qtr. | - | - | - | - | - | |
| Capacity utilization - can increase sales 10% without new inputs | ||||||
| % "Yes" | 2/2005 | 51 | 59 | 56 | 55 | 48 |
| Prior qtr. | - | - | - | - | - | |
| Credit availability (last three months) | ||||||
| % All credit needs satisfied | 2/2005 | 47 | 36 | 35 | 38 | 45 |
| Prior qtr. | - | - | - | - | - | |
| % All credit needs not satisfied | 2/2005 | 5 | 8 | 8 | 6 | 8 |
| Prior qtr. | - | - | - | - | - | |
| % No credit needs | 2/2005 | 43 | 52 | 52 | 53 | 43 |
| Prior qtr. | - | - | - | - | - | |
| Iowa | Ill. | Minn. | Mo. | Wis. | ||
| Prices | ||||||
| Purchasing prices (last three months) | ||||||
| Net % increased | 2/2005 | 50 | 55 | 60 | 54 | 58 |
| Prior qtr. | - | - | - | - | - | |
| Selling prices (last three months) | ||||||
| Net % increased | 2/2005 | 14 | 18 | 21 | 21 | 15 |
| Prior qtr. | - | - | - | - | - | |
| Miscellaneous | ||||||
| Involvement in start of another business | ||||||
| % "Yes" | 2/2005 | 10 | 15 | 12 | 12 | 9 |
| Prior qtr. | - | - | - | - | - | |
| Single most important business problem | ||||||
| % Weak sales | 2/2005 | 8 | 10 | 12 | 7 | 9 |
| Prior qtr. | - | - | - | - | - | |
| % Taxes | 2/2005 | 9 | 7 | 8 | 14 | 12 |
| Prior qtr. | - | - | - | - | - | |
| % Employee quality/costs | 2/2005 | 8 | 8 | 9 | 10 | 9 |
| Prior qtr. | - | - | - | - | - | |
| % Insurance | 2/2005 | 19 | 21 | 21 | 17 | 25 |
| Prior qtr. | - | - | - | - | - | |
| % Big-business competition | 2/2005 | 17 | 11 | 17 | 12 | 14 |
| Prior qtr. | - | - | - | - | - | |
| % Inflation/Rising prices | 2/2005 | 10 | 16 | 13 | 12 | 14 |
| Prior qtr. | - | - | - | - | - | |
| % Credit availability/Interest rates | 2/2005 | 1 | 3 | 2 | 4 | 3 |
| Prior qtr. | - | - | - | - | - | |
| % Regulations/Red tape | 2/2005 | 11 | 9 | 8 | 9 | 7 |
| Prior qtr. | - | - | - | - | - | |
| Iowa Quarterly Spotlight | |
| In general, how satisfied are you with the direction that Iowa is headed? | |
| Very satisfied | 11% |
| Somewhat satisfied | 60% |
| Not too satisfied | 15% |
| Not at all satisfied | 7% |
| Don't know/Refused | 7% |
| Total | 100% |
| On balance, is your business very positively, somewhat positively, somewhat negatively or very negatively impacted by trade with other countries? | |
| Very positively | 8% |
| Somewhat positively | 22% |
| Neither; not impacted | 36% |
| Somewhat negatively | 14% |
| Very negatively | 7% |
| Don't know/Refused | 13% |
| Total | 100% |
The Poll
NFIB’s Iowa Small-Business ConditionsSM is a telephone survey of a random sample of Iowa small employers regarding business conditions within the state. “Small employer” is defined here as employing between one and 250 people (not including the owner(s)) in a for-profit business. Each edition of the survey has a minimum of 350 respondents. The sampling error is ± 5 percentage points. Data are collected quarterly in the months of February, May, August and November, beginning in February 2005. The MRCGroup of Las Vegas conducts the survey for the NFIB Research Foundation.
The Sponsor
The NFIB Research Foundation is a 501 (c)(3) organization that provides policy-makers, media, educators, small-business owners and other interested parties empirically based information on small business and small-business owners. The Foundation is affiliated with the National Federation of Independent Business, the nation’s largest small- and independent-business advocacy organization, and is located in Washington, D.C.
