Des Moines sees dramatic job shifts toward warehousing
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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.