Economic data shows varying trends for SE Iowa

DES MOINES — A series of maps released by the Iowa Legislative Services Agency (LSA) over the summer shows a handful economic gaps between Southeast Iowa counties.

The trends paint a different picture for each community. While Southeast Iowans share a number of economic woes — low housing inventory, access to child care, struggles filling the workforce — the trends manifest differently across the region.

Washington County has lowest average wages, but higher income, cost of living

One map — based on findings from the quarterly census of employment and wages by the U.S. Bureau of Labor Statistics — shows that Washington County businesses pay the ninth lowest wages in the state, with average annual pay at $41,240.

That number is out of step with other indicators for the area. According to the 2020 Census, Washington County ranks 27th in both population (22,565 people) and median household income ($65,061.) Both are greater than numbers in neighboring Henry County (pop. 20,482, median $56,260) and Jefferson County (pop. 15,663, median $52,830.)

Iowa Workforce Development (IWD) Public Information Officer Jesse Dougherty said the disconnect between wages and income could be explained by those employed in other counties.

“It’s important to remember that workers are mobile,” he said. “Data shows that 62.7% of employed Washington County residents live in Washington County and commute somewhere else to work. Individuals who travel to work in Johnson, Muscatine, and other counties are receiving the wages listed under those counties and bringing those earnings back to Washington.”

Washington County also has a considerably higher cost of living than its neighbors.

According to a spreadsheet made by data set company Lightcast and provided by IWD spokespeople, the cost of living index for Washington County is 98.1, compared to the nationwide benchmark of 100.

On face, that’s squarely in the middle of the pack, ranking 49th out of the state’s 99 counties. Locally, however, it’s unusually high. To the north, Johnson County boasts a slightly lower COL at 97.8. Jefferson (94) and Henry (93.8) counties are among the 10 lowest indexes in the state.

All three data points make Washington County an unusual case for Southeast Iowa. In the area, only Louisa County has a higher median household income ($72,404) while none have a lower average wage or higher cost of living.

IWD Communications Strategist Jeff Eckhoff said the county’s outlying status was likely due to its industrial makeup, which could negatively skew averages.

“Washington has a lot of heath care and social assistance occupations, generally from assisted living centers, and this type of work usually pays less than other industries,” he said in an email. “For example, Jefferson County has a higher concentration of high finance and insurance employment, while Johnson County benefits from higher private education industries and Henry County benefits from warehousing and transportation.”

Jefferson County grapples with fast-climbing housing costs

In Jefferson County, the data suggests housing is a greater cost burden than in most of the state, with 22.7% of homeowners spending over 30% of their household income on owner costs like mortgages, real estate taxes, utilities and fuel. Compare that to the statewide average of 19.4%.

The trend likely extends to tenants who don’t own homes, according to Sieda Community Action Economic Support Staff Shelby Harris, who works in the group’s Jefferson County office.

“Since COVID, housing requests here have gone up significantly, probably 25%,” she said. “That’s people asking for help paying their rent.”

Nearby, Wapello and Appanoose counties have a similar problem, with 25.7% and 25% of homeowners, respectively, identified as “cost burdened” by the LSA map.

The cause in one county may differ from its neighbors. Census data suggests a lower income for Wapello and Appanoose, where a combined average of 13.7% of families are in poverty, according to census data. Jefferson County’s comparatively low 6.9% poverty rate could suggest another factor at play.

The rising cost of housing is one possibility.

Jefferson County saw median home sale prices jump by 33.9% from June of 2021 to ‘22, up to $195,500 for single-family detached properties, according to the Iowa Association of Realtors.

June Lowenberg, an associate broker at Miller Realty in Fairfield, was unsurprised by the trend, and said similar price growth held true across all home types, not just single-family detached properties.

“I usually tell people you want to own your house five years if you want to walk away even on a sale,” she said. “After COVID, I’ve seen people make money on their houses in a year. There’s not a whole of communities where you can purchase a house, and then live there, and then sell it for that same price within five years. You’re basically living there for free.”

Lowenberg credited the climbing cost of homes to Fairfield’s housing shortage. While other communities in Southeast Iowa face the same issue, she said Fairfield’s was magnified by a larger industrial base.

“We have some really great, solid companies that are hiring,” she said. “So when you have good employers, and then you have a community that cares about activities going on … it’s a desirable location.”

The change in home price points varies widely from one county to the next. According to the same data map, Lee County’s median sale value went up by 71%. Muscatine’s climbed by 58.1%, Des Moines County rose by 51.2%.

Lowenberg said she saw signs of growing interest in Midwestern living.

“Everyone sees on social media and everything, having a chicken, having a goat, having a little hobby farm, and they want that,” she said. “I think when you’re searching all that, Fairfield comes to light.”

What’s harder to explain is why some counties around the state have falling prices. Pocahontas County is the strongest example, with a 67.2% median sale price drop from ‘21 to ‘22. Closer to home, Keokuk County saw a 10.1% decrease, Wapello declined by 7.1%, Van Buren by 22.5%.

Washington and Henry County both saw median prices go up in smaller increments of 6.1% and 1.5%, respectively.

Henry County, southeast corner, face high poverty rates

In Henry County, the most glaring concern is the poverty rate, clocked at 8.3% of families by Census estimates from 2016 to 2020. The trend holds true for the rest of Iowa’s Southeastern tip: Lee County’s rate is 8.6%, Des Moines’ is 12.7% and Van Buren’s is 8.6%. The statewide average is 7.1%.

The complexity of the issue makes pinpointing a primary cause impossible, according to Community Action of Southeast Iowa Planning Director Rachel Albrecht.

“There’s just so many different factors out there that contribute to it,” she said. “There’s so many different things that influence it and factor into that situation.”

Contributing factors are endless. One may be lack of work: Henry County’s 4.8% unemployment rate (according to Census estimates for the same year) is above the state average of 3.9.

Other common issues, according to Albrecht, include a lack of available housing and child care, absence of mental health care facilities, and difficulty commuting in the largely rural communities.

As for what it would take to address the issue, Albrecht said the need for government aid was always dire.

“We do some surveys, and they need financial assistance,” she said. “When we ask questions like, ‘What could we do better?’ the answer is always, very frequently, ‘More assistance.’ … there’s so much more need out there, and it’s flat-out money they need.”

Comments: Kalen.McCain@southeastiowaunion.com