Des Moines sees dramatic job shifts toward warehousing

Despite the pandemic, employment in the Des Moines metro grew 1.4% between February 2019-2022, according to a labor analysis by Iowa State economics professor Peter Orazem.

Yes, but: That growth masks a large transfer of jobs between sectors — notably a steep employment decline for Des Moines' leisure and hospitality industry, Orazem said.

Why it matters: It signals a slower recovery for local restaurants, bars and hotels as they compete with other fast-growing industries, like e-commerce, per Orazem.

State of play: Des Moines' market share of warehouse and "Amazon shipping-type jobs" has dramatically increased since 2019 — jumping by nearly 26% in comparison to the state's marginal increase of 3.5%, said Orazem, who examined percent change.

• In comparison, warehousing jobs increased by more than 15% nationwide.

The intrigue: "Because Des Moines is at the juncture of two major interstates, it's in a good position for warehousing and transportation," according to Orazem.

Meanwhile, the restaurant and hospitality industry in Des Moines suffered the greatest losses — with a 4.3% change since 2019.

• Still, Iowa didn't suffer as much as the rest of the country. The state as a whole only saw a 3% drop. In comparison, the nation's leisure and hospitality dropped a whopping 8% because of their stricter rules, Orazem said.
• The places that suffered worst — like Iowa City and Cedar Rapids — rely on athletics, which were restricted in 2020.

Other sectors of interest: Financial activities, which includes banking and insurance, didn't grow as quickly in Des Moines in comparison to the nation — 1.3% vs. 3.2%

• But those industries already have a strong presence in the metro, meaning growth will be more marginal.

The bottom line: Des Moines' employment is realigning as the pandemic changes how we shop.

• "And that's going to make it a lot harder as the leisure and hospitality industry comes back," Orazem said.