If Iowa loses caucus position, Des Moines will miss out on major boost
The boost Des Moines gains from the Iowa caucuses is on the line now that the Democratic National Committee no longer guarantees the state its first-in-the-nation status in the presidential nominating process.
Why it matters: The political frenzy fuels revenue upticks for hotels, restaurants, leisure businesses and media outlets in the capital city.
Plus: The caucuses provide a boost during a typical lull in travel during the January and February months.
- And they can often draw national media — and their money — to the area even earlier to catch events like the Iowa State Fair and the Harkin Steak Fry, Greg Edwards, president of Catch Des Moines, told Axios.
- "The hotels have already been asking us, what's going on?" Edwards told Axios.
By the numbers: In 2020, Catch Des Moines estimated the caucuses generated $11.3 million in revenue for Des Moines businesses, based on hotel reservations and the number of media outlets who came to the metro the week prior to the event.
- For media outlets, the advertising spending is significant. In Iowa, political ads from caucus candidates reached $44 million for the 2020 caucus, an increase from $40 million in 2016.
- But the big draw is the amount of exposure Des Moines gets by major news outlets mentioning the city — an advertising value that's estimated to total $200+ million, Edwards said.
Yes, but: Economists say the effects aren't long-lasting.
- Around January and February, Des Moines hotels are typically at 60% capacity. That marginally bumps to 90% in a caucus year.
- In comparison, the annual state wrestling tournament results in 100% capacity, Iowa State economist Peter Orazem said in 2020.
And in terms of the labor market, most Iowans who are capable of working a full-time job are already employed.
- Campaign positions mostly draw from the existing workforce, rather than provide new jobs.
Between the lines: Some benefits, like networking, are hard to measure.
- Raygun owner Mike Draper said connections created during the caucuses have led to more business opportunities, including a relationship with the White House Correspondents' Association.
The Des Moines-based clothing and design company is making T-shirts and swag for the group's upcoming dinner on April 30, featuring comedian Trevor Noah.
- "A lot of the work we've done has come from connections with the caucuses," Draper said.
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