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State unemployment rate now tied for second lowest nationwide

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Iowa Workforce Development employment numbers.

Iowa’s unemployment dropped down to 2.6% in July. Iowa Workforce Development spokesman, Cory Kelly, says that’s down from 2.7% in June.

“That puts Iowa tied with North Dakota for second lowest unemployment rate in the country — and an 18-year low — we haven’t seen this since July of 2000,” according to Kelly. “So, we’re sitting in an interesting spot here.”

Kelly says it is hard to tell if the rate has hit as low as it can go.

“Number one in the nation is Hawaii. They are sitting at two-point-one percent, so clearly environments can go lower than we are now. We’ll just have to see how it all shakes out,” Kelly says. The number of working Iowans is estimated to have increased by 5,200 in July. Manufacturing led the way in new jobs.

“Thirteen-hundred over the month, following another moderate gain of 900 jobs in June,” Kelly says of the manufacturing sector. “Also the financial activity sector added 600 jobs in June and continues to expand its footprint in the Iowa economy.” The construction industry had a small gain if 300 jobs — but is was the sixth consecutive month the industry added jobs.

The negative side of the job market is in retail “We saw retail shed the most jobs in July — down 3,000 — and was responsible for all the losses in trade and transportation,” Kelly says. Kelly says retail has been trending down in jobs since the start of the year as store closings were announced across the state.

“We expect that to continue, or it may continue as online sales continue to gain in popularity around the nation,” Kelly says. The state unemployment rate in July of last year was 3.1%. The U.S. unemployment rate was 3.9% percent in July.

 

Ambassador Branstad says Chinese trade discussions continue

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Terry Branstad (file photo)

Farmers in Iowa and across the Midwest want quick resolution to the looming trade war due to the negative impact it’s starting to have on their bottom lines.

Speaking in Des Moines over the weekend, the U.S. Ambassador to China, Terry Branstad, says he isn’t sure how long the impasse with China will last. “We’re continuing to have discussions,” Branstad says. “I’m trying to keep the leaders in Washington informed and do all that we can. We’ve had several meetings and we’re going to continue to work on it.”

Branstad, a former Iowa governor, says President Trump is justified in putting tariffs on imports of Chinese goods into the U.S. He says China is in worse financial condition than the U.S. due to the drop in that nation’s stock market and currency value. “China has not treated us or other countries fairly for a long time with their stealing of technology and also not enforcing intellectual property rights, the trade deficit has gone up and up,” Branstad says. “We’re trying to get fair and reciprocal trade and we want to double ag exports over the next five years.”

Speaking at the Iowa State Fair, Branstad says it’s unfortunate American farmers have been collateral damage in the trade war and he’s unsure what it will take for China to finally cut a deal with the U.S.  “What the United States has done, we’ve focused on the areas that they’ve been unfair on, stealing technology and that,” he says. “They have focused on agriculture which had nothing to do with this. That’s why we think what the Chinese have done is unfair and they need to come to the realization, just as they did with sorghum, that this doesn’t make sense and they’re hurting their own consumer.”

Branstad says U.S. Treasury Secretary Steve Mnuchin has been in talks with Chinese officials over the past two weeks, so the countries are trying to negotiate.

(By Jerry Oster, WNAX, Yankton)

 

SBA opens office in Marshalltown for tornado recovery

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Downtown Marshalltown prior to clean up.

The damage in Marshalltown from last month’s EF-3 twister is so severe, the U.S. Small Business Administration is now staffing an office in the central Iowa city to process loans to rebuild.

SBA spokesman Burl Kelton says the low-interest loans are for business owners, in addition to homeowners and renters who saw damage in the powerful July 19th storm. Kelton says, “We have statutory interest rates, the maximum term is 30 years, and for businesses $2-million of actual damage, for homeowners $200,000 for physical damage and $40,000 for personal property, including vehicles.”

The loans are through the federal government, he adds, not a bank. The federal disaster declaration for Marshall County makes SBA assistance available to people in the surrounding counties as well: Grundy, Hardin, Jasper, Poweshiek, Story and Tama.

“We’re in Marshalltown probably for the next couple of weeks so folks can come in and talk to a customer service representative, find out whatever information they’d like to and actually make an application while they’re here to see us,” he says. The National Weather Service says 13 tornadoes hit Iowa that day, but only Marshalltown was hit with an EF-3, with winds of up to 144 miles-an-hour.

While some business owners and residents may have lost nearly everything, Kelton says if possible, they should bring in as many of the following items as possible. “Any insurance information, insurance policy numbers and amounts, a recent tax return if they have that, work stubs, pay stubs, that sort of thing,” Kelton says, “because what we do is use that information to determine the cash available for additional debt.”

Around 90 homes in Marshalltown were destroyed in the twister, more than 600 were damaged. The SBA’s Disaster Loan Outreach Center is in the Fisher Community Center at 709 South Center Street in Marshalltown. It’s open Monday through Friday, 8 a.m. to 5 p.m.

Iowans can also apply online by downloading applications at https://disasterloan.sba.gov/ela, or call 800-659-2955.

La Motte company wins SBA loan to install fiber optic cable

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The La Motte Telephone Company has won an SBA loan to install fiber.

A tiny town in eastern Iowa’s Jackson County is the beneficiary of a more than $2.7 million loan from the U.S. Department of Agriculture.

The loan is going to the La Motte Telephone Company. General Manager JoAnne Gregorich says the money will be used to install 71 miles of underground fiber-optic cable around the town of Andrew.

“Once the main line cable is buried, then we will go and plow individual drops to each customer’s home,” Gregorich said. The project will result in higher-speed broadband internet for the roughly 400 people who live in Andrew. The construction work is extremely expensive, and without the USDA loan, it wouldn’t be possible.

“In the big city, you can go down a city block and serve I don’t even know how many people…15 maybe? In a rural area, we might have to plow a mile, two miles, or three miles between customers,” Gregorich said.

The loan for Andrew, Iowa was announced last week as part of a U.S.D.A. investment of $97 million in 12 rural broadband projects in 11 states.

(Photo from La Motte Telephone Company Facebook page)

 

Creighton economic survey finds concern over tariffs

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Ernie Goss

A monthly economic survey of business leaders in Iowa and eight other Midwestern states predicts a slowdown is coming and Trump administration tariffs are to blame.

Creighton University economist Ernie Goss says the survey found nearly two-thirds of firms questioned reported recent tariffs and trade restrictions have had, or will have, a negative impact on their companies. “If President Trump keeps pushing on this trade, it’s going to push the economy into slower growth territory and inflation,” Goss says. “That’s going to push interest rates up.”

The survey found almost 47% of supply managers questioned said recent tariffs have had negative impacts on buying from abroad. While a U.S. Commerce Department report released Friday showed the country’s economic growth climbed above four-percent this spring for the first time in almost four years, Goss isn’t optimistic.

“Last week, the president talked a lot about the 4.1% growth, but I think we’ve reached the high water mark for the year,” Goss says. “It’s not going to come down much but we’re going to see slower growth. The second half is not going to be as strong as the second quarter we just saw, but it’s still going to be positive.” Jobs figures for the nine-state region in July fell from the June report. Goss says overall employment growth in the region in the past 12 months has been healthy but it’s expanding at a rate slower than the nation.

“Overall job growth in the region is about 1.2% year-over-year while the U.S. number is stronger than that at 1.6%,” Goss says. “I’m a little concerned about the job additions in the region, not as strong as we’d like to see. Manufacturing is doing better than the overall economy in the Mid-America region.” Goss says in the Midwest, trade tensions are “a clear and present danger” to the overall economy. The Creighton survey shows Iowa’s job numbers sank from June to July. Goss says U.S. Census data indicates Iowa exported $4.5 billion in agricultural and food products in 2017. This represented 34% of total 2017 state exports, or third highest in the nine-state region.

 

Schedule moved up for shutting down Iowa’s only nuclear power plant

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A new agreement reached between Alliant Energy and the operator of Iowa’s only nuclear power plant will see the plant shut down five years earlier than first projected.

NextEra Energy Resources spokesman, Peter Robbins, says the change came about as they looked at a new agreement with Alliant to purchase power from the Duane Arnold Energy Center in Palo.

“We took a look at all options that were on the table an both companies agreed to move forward with shortening the term of the power purchase agreement,” Robbins says. “As of right now were are anticipating Duane Arnold Energy Center will cease electrical production, will cease commercial operations at the end of 2020.” Robbins says employees of the plant will have some decisions to make.

“We have about 540 people who work here at Duane Arnold right now and they’re part of our corporate family so today’s decision was very difficult for the entire company,” Robbins says. “We have a path forward for them. Our company believes in doing the right thing and treating people with respect — and that’s what we are going to do in this case.” He says employees will have several options as the plant moves toward closing.

“Between now and the end of 2020 we will be able to offer people who are retirement eligible an enhanced retirement package,” he says. “When we do shut down in late 2020 we are still going to need about 300 people here on sight. So we’ll have hundreds of jobs available on sight in 2020 as we start the decommissioning process. And for anybody who is interested, we will offer jobs within our company.” He says NextEra has operations in 35 states.

The shutdown of the Palo operation will begin soon after the energy contract expires. “A lot of what that work involves is unloading fuel from the reactor and putting it safely in what’s called spent fuel pool to let it cool down. That takes place over a period of years,” according to Robbins. “So, the decommissioning process for a nuclear power plant is very gradual, very lengthy. We anticipate it will start in late 2020, and it will carry on for a significant amount of time.” Robbins says the declining costs of other sources of energy have led to the decision to shut down the plant.

“You are just seeing continued pressure on all sources of energy — from renewables and from natural gas — and we are certainly seeing that in the market place in Iowa,” Robbins says. NextEra Energy Resources says it plans to invest approximately $650 million in existing and new renewables generation across Iowa before the end of 2020. Alliant Energy says it will save customers nearly $300 million in the next 21 years by switching away from the use of the nuclear power.

Alliant Energy has agreed to make a $110 million buyout payment to NextEra Energy Resources in September 2020 to cover the cost to shorten the term of the power agreement.

(photo courtesy of NextEra Energy Resources)

 

Lennox Industries willing to rebuild in Marshalltown

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National Weather Service photo of Lennox Industries tornado damage in Marshalltown.

Lennox Industries will rebuild in Marshalltown. The factory which produces heating and cooling equipment was heavily damaged by last week’s tornado. Marshalltown Mayor Joel Greer made the announcement at last night’s city council meeting.

“They’re willing to rebuild and just think of the kind of money it’s going to take to get that plant back in operation,” Greer said.

The major suggested it could  take $100 million to replace the Lennox factory, which is one of Marshalltown’s largest employers. Greer said the company’s decisions will have ripple effects through the community.

“To be telling their contractor to be buying supplies from the local people who have the supplies and using the local labor, including their own employees,” Greer said.

Greer and the governor met with the company’s executives Monday afternoon to discuss the company’s plans. Lennox Industries was founded in Marshalltown in 1895. About 1400 people were employed at the facility when the tornado hit.

(Reporting by Ken Huge, KFJB, Marshalltown)

Muscatine company showcased in White House business event

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Gage Kent and his son Jimmy in Washington, D.C.

The two leaders of an Iowa feed company were part of a “Made In America” showcase at the White House Monday.

Kent Corporation CEO, Gage Kent, says his company of the only one from Iowa and the only ag company that was part of the event. Kent says he talked directly with the president about the concerns of the ag industry and has faith that the concerns about trade issues are going to be worked out.

“In general, I think everyone in ag needs to put their faith in the negotiators. It’s not been a level playing field for decades, and the administration is   endeavoring to readjust and make a better deal for America,” Kent says.   He says he understands the concerns of farmers and business owners but says changing the trade imbalance is not a quick fix.

“That takes a little bit of time and a little bit of patience, ” Kent says. “But we have probably the best negotiators in the administration — arguably in my view — than we’ve had in decades.” Kent’s grandfather started the Muscatine-based business 90 years ago and he says they now do business across the globe selling animal feed and other products. He says his company has not noticed issues yet with the trade tariffs but knows there are concerns out there.

“As far as our businesses are concerned, we have seen frankly from some of our trading partners the same sort of concern in the converse as to what’s going to happen,” according to Kent. “But the picture is still not painted yet, I guess.”   Kent and his son Jimmy Kent, who is the company’s president, both talked with other businessmen during the event.

“I think the key take away that we go home with is that there’s more optimism among manufacturers, there’s more optimism in D-C, and there’s just an energy in the economy right now thanks to the president and the administration and to the cooperation of congress to putting American on a level playing field with the rest of the world and letting us compete,” Kent says.

Kent says President Trump highlighted the importance he has for farmers by throwing green hats that said: “Making farmers great again,” into the crowd at the event. Kent Corporation is privately-owned and has nearly 2,000 employees throughout its 23 locations across 13 states.

California biodegradable packaging company moving to Iowa

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Biodegradable products made by Chamness.

A manufacturer of compostable packaging is moving its operations from California to Iowa.

Jon Kallen, spokesperson for Chamness Biodegradables, says Iowa’s “business climate” is the main factor in the company’s decision to relocate from Camarillo to Ankeny. “This company uses a lot of energy to make the products and we’re paying about 21-cents a kilowatt hour for electricity in Southern California. We’ll probably pay around 6-to-7-cents a kilowatt hour in Ankeny,” Kallen told Radio Iowa.

Gary Chamness, the owner of the company, is a native of Blairsburg in northern Iowa’s Hamilton County. Kallen expects the new facility in Ankeny will eventually employ 36 people. “The jobs are going to be in research and development, sales, production, and custom fabrication because for a lot of these materials you have to make molds,” Kallen said.

Chamness Biodegradables makes serve-ware and bakeware, and according to Kallen, the company’s customized packaging division is booming. We make a myriad of packaging items for clients, including six-pack beer ring holders, test tube holders for laboratories, we make packaging for a national pizza home delivery company, and we provide all the packaging for a company that delivers home meals,” Kallen said.

The Iowa Economic Development Authority Board, on Friday, awarded Chamness with $140,000 in direct financial assistance and tax benefits. Chamness plans to lease a 27,500 square foot building in Ankeny.

 

 

Online grocery delivery service expands into Iowa

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Residents in eight communities in two Iowa metro areas can now order groceries online and have them delivered to their doors.

Instacart operations manager Megan Zigler says they recently launched service in the Council Bluffs-Omaha area as well as in the Quad Cities.

“Instacart is a service that delivers groceries and everyday essentials same day, often in as little as one hour,” Zigler says. “We connect customer orders with shoppers in the area who will pick up and deliver those groceries from the favorite local stores.”

The service works with a host of local grocery stores in addition to, in some cities, drug stores and pet stores. It’s not a sign we’re getting too lazy, Zigler says, but more an indication that many of us are too busy and could use one less chore.

“People are just more and more crunched for time. This gives people hours back in the week,” Zigler says. “It also alleviates a lot of frustrations that come with navigating parking lots and cashier lanes. We take on that burden for our customers.”

While there’s growing concern about “porch pirates” stealing our packages dropped off by FedEx or UPS, Zigler says Instacart customers can choose the hour they want their groceries delivered, up to a week in advance.

“If you prefer to be home when your groceries arrive, we can arrange for that very easily,” Zigler says. “Typically, our customers are home when deliveries are made since there are often chilled or frozen items, but certainly, customers have the option to make a note to their shopper that they can simply leave the items in a porch or on the front stoop.”

It’s also a big benefit, she says, for people who have mobility or transportation issues. The minimum order is $10 and for orders of $35 or more, the delivery fee is $5.99 plus 5% of the total order. There are also monthly and annual memberships for unlimited free deliveries.

Instacart now covers the following Iowa cities: Bettendorf, Carter Lake, Council Bluffs, Crescent, Davenport, Eldridge, Le Claire and Pleasant Valley.