Des Moines rebounds, gains 38 spots in Milken Institute’s Best Performing Cities index
MICHAEL CRUMB Mar 28, 2022 | 8:12 pm
10 min read time
2,312 wordsAll Latest News, Economic Development
Des Moines jumped 38 spots in the Milken Institute’s 2022 Best Performing Cities Index, in part because of stronger than average job growth, an indication of the region’s resiliency, an author of the report released today said.
The report, “Charting Economic Resilience and Opportunity,” shows that the Des Moines metro area was ranked 95th in the large city category for cities with populations over 270,000. That is an improvement from the metro’s 2021 ranking, which gave the city the fifth-steepest decline in the rankings that year, when it ranked 133.
The Provo-Orem, Utah, region was ranked the No. 1 best performing city in the large city category. Logan, Utah, ranked No. 1 on the list for small cities, or those with populations of fewer than 270,000.
The rankings are based on government data, such as U.S. Census Bureau data and surveys, on 400 metro areas from 2019 through 2020. The data becomes available for researchers in mid-2021.
Kevin Klowden, executive director of the Milken Institute’s Center for Regional Economics and the institute’s California Center, said ongoing job growth was probably the biggest contributor to Des Moines’ increase in 2022. The metro ranked 60th in job growth in the 2022 report, up from 93 the previous year.
“Des Moines proved itself a lot more resilient than the average city in terms of job growth,” he said in comments made ahead of today’s release. “When you combine that with job growth that was taking place in the 2015 to 2020 periods, the periods leading up to the pandemic, Des Moines proved itself more resilient and … it consistently did well.”
Klowden said the metro area’s improved job growth ranking shows that “Des Moines has consistently been a center of job growth and positions it well compared to some of the other cities around it.”
According to data provided by the Milken Institute, nonfarm employment in 2022 for the Des Moines metro was 369,600. That was up from 358,000 in 2021.
One area of continuing concern is wage growth in the metro, Klowden said.
That is especially concerning because Des Moines is above average in the concentration of high-tech jobs, which traditionally have higher salaries, he said.
“The jobs that were created were more at the lower end of the economic spectrum, so your unskilled or semi-skilled jobs, or … technology-based jobs that had to pay better, and that is one of those concerns,” Klowden said.
According to data from the Bureau of Labor Statistics, the average annual salary in Des Moines in January 2022 was $58,240. That is up from $56,940 in 2021; $51,948 in 2020; and $48,516 in 2019.
Des Moines ranked 149th in wage growth in the current report, compared with 193 in 2021. Despite continued concerns with the area’s wage growth ranking, the metro’s strong job growth indicates the community has recovered more quickly than others from the effects of the pandemic, trade issues and supply chain disruptions, Klowden said.
“Even though wage growth was not that strong, having a large number of different jobs and having very low unemployment, [that] very broad range economic stability is very significant,” he said.
Des Moines also did well in broadband access and housing affordability, metrics that were added to the study last year, he said.
“Something that has helped the metro overall are … broadband access and housing affordability,” he said. “Because given the number of people running small businesses out of their home, working from home, doing other activities that way as well as being able to support and grow a family, Des Moines actually does well above average in both of the categories. You combine that with the fact the economic climate has been doing well in generally creating jobs, it’s been a big deal.”
Des Moines ranked above average in housing affordability at 49th, and it ranked 69th in broadband access, which places the metro in a better position than many other metro areas in the Midwest. But there is room for improvement, Klowden said.
“If you take a look at Omaha, it comes in 24th where that infrastructure for broadband is very strong,” he said. “If you take a look at our top 10 cities, there were a certain number of cities in our top 10 that had remarkable levels of broadband.”
He cited Lincoln, Neb., which came in fourth in the country in broadband access, and McAllen, Texas, which came in second.
Klowden said some of that success comes because communities are taking a more holistic approach to broadly developing a broadband network, rather than focusing on specific neighborhoods or businesses.
“That makes a significant difference because you’re not just concentrating access to certain areas, it’s allowing the broader area to benefit,” he said. “Some of the wealthiest metros in the U.S. have real problems with broadband access because there was a lot of picking and choosing. The more access goes all over, it allows economic revitalization, it helps the businesses and the people who remote work, and if that effort continues and that ranking goes up that can only benefit the metro.”
Data used in the report was collected before the Legislature approved increased investment for broadband expansion during the 2021 session, and before the state allocated federal coronavirus relief funds for expanding access to high-speed internet statewide.
Klowden said he would expect Des Moines’ position in the overall rankings to continue to improve as it continues to recover from the pandemic.
While Klowden said he would expect Des Moines’ ranking to increase next year, he tried to dampen expectations.
“The thing I would be careful about is that Iowa was recovering earlier than some places, and while I would expect Iowa to go up a bit more, I wouldn’t expect a dramatic improvement in the rankings largely because some of the external factors that hit it hard have already been resolved,” he said. “The big questions really are in terms of trade flows and exports, that Iowa will continue to be better positioned as various logistics chains are restored and they continue to improve.”
Next year’s numbers should provide greater clarity into the effect of the supply chain disruptions of late 2021, Klowden said.
“That’s the factor that just needs to be accounted for, but I don’t expect Iowa to be as badly hit as a few other places,” he said.
Klowden said the big takeaway from the 2022 report is the way Des Moines bounced back from the previous year.
“Des Moines snapped back from a previous index where there had been a very clear economic impact on the metro, not just jobs but particularly wages in the last index, and it’s clear Des Moines is moving forward and recovering,” he said. “Unless the logistics chain disruption plays itself out in the data for this next year, we’d expect Des Moines to continue to move up, even if not quite as quickly.”
Des Moines jumped 38 spots in the Milken Institute’s 2022 Best Performing Cities Index, in part because of stronger than average job growth, an indication of the region’s resiliency, an author of the report released today said.
The report, “Charting Economic Resilience and Opportunity,” shows that the Des Moines metro area was ranked 95th in the large city category for cities with populations over 270,000. That is an improvement from the metro’s 2021 ranking, which gave the city the fifth-steepest decline in the rankings that year, when it ranked 133.
The Provo-Orem, Utah, region was ranked the No. 1 best performing city in the large city category. Logan, Utah, ranked No. 1 on the list for small cities, or those with populations of fewer than 270,000.
The rankings are based on government data, such as U.S. Census Bureau data and surveys, on 400 metro areas from 2019 through 2020. The data becomes available for researchers in mid-2021.
Kevin Klowden, executive director of the Milken Institute’s Center for Regional Economics and the institute’s California Center, said ongoing job growth was probably the biggest contributor to Des Moines’ increase in 2022. The metro ranked 60th in job growth in the 2022 report, up from 93 the previous year.
“Des Moines proved itself a lot more resilient than the average city in terms of job growth,” he said in comments made ahead of today’s release. “When you combine that with job growth that was taking place in the 2015 to 2020 periods, the periods leading up to the pandemic, Des Moines proved itself more resilient and … it consistently did well.”
Klowden said the metro area’s improved job growth ranking shows that “Des Moines has consistently been a center of job growth and positions it well compared to some of the other cities around it.”
According to data provided by the Milken Institute, nonfarm employment in 2022 for the Des Moines metro was 369,600. That was up from 358,000 in 2021.
One area of continuing concern is wage growth in the metro, Klowden said.
That is especially concerning because Des Moines is above average in the concentration of high-tech jobs, which traditionally have higher salaries, he said.
“The jobs that were created were more at the lower end of the economic spectrum, so your unskilled or semi-skilled jobs, or … technology-based jobs that had to pay better, and that is one of those concerns,” Klowden said.
According to data from the Bureau of Labor Statistics, the average annual salary in Des Moines in January 2022 was $58,240. That is up from $56,940 in 2021; $51,948 in 2020; and $48,516 in 2019.
Des Moines ranked 149th in wage growth in the current report, compared with 193 in 2021. Despite continued concerns with the area’s wage growth ranking, the metro’s strong job growth indicates the community has recovered more quickly than others from the effects of the pandemic, trade issues and supply chain disruptions, Klowden said.
“Even though wage growth was not that strong, having a large number of different jobs and having very low unemployment, [that] very broad range economic stability is very significant,” he said.
Des Moines also did well in broadband access and housing affordability, metrics that were added to the study last year, he said.
“Something that has helped the metro overall are … broadband access and housing affordability,” he said. “Because given the number of people running small businesses out of their home, working from home, doing other activities that way as well as being able to support and grow a family, Des Moines actually does well above average in both of the categories. You combine that with the fact the economic climate has been doing well in generally creating jobs, it’s been a big deal.”
Des Moines ranked above average in housing affordability at 49th, and it ranked 69th in broadband access, which places the metro in a better position than many other metro areas in the Midwest. But there is room for improvement, Klowden said.
“If you take a look at Omaha, it comes in 24th where that infrastructure for broadband is very strong,” he said. “If you take a look at our top 10 cities, there were a certain number of cities in our top 10 that had remarkable levels of broadband.”
He cited Lincoln, Neb., which came in fourth in the country in broadband access, and McAllen, Texas, which came in second.
Klowden said some of that success comes because communities are taking a more holistic approach to broadly developing a broadband network, rather than focusing on specific neighborhoods or businesses.
“That makes a significant difference because you’re not just concentrating access to certain areas, it’s allowing the broader area to benefit,” he said. “Some of the wealthiest metros in the U.S. have real problems with broadband access because there was a lot of picking and choosing. The more access goes all over, it allows economic revitalization, it helps the businesses and the people who remote work, and if that effort continues and that ranking goes up that can only benefit the metro.”
Data used in the report was collected before the Legislature approved increased investment for broadband expansion during the 2021 session, and before the state allocated federal coronavirus relief funds for expanding access to high-speed internet statewide.
Klowden said he would expect Des Moines’ position in the overall rankings to continue to improve as it continues to recover from the pandemic.
While Klowden said he would expect Des Moines’ ranking to increase next year, he tried to dampen expectations.
“The thing I would be careful about is that Iowa was recovering earlier than some places, and while I would expect Iowa to go up a bit more, I wouldn’t expect a dramatic improvement in the rankings largely because some of the external factors that hit it hard have already been resolved,” he said. “The big questions really are in terms of trade flows and exports, that Iowa will continue to be better positioned as various logistics chains are restored and they continue to improve.”
Next year’s numbers should provide greater clarity into the effect of the supply chain disruptions of late 2021, Klowden said.
“That’s the factor that just needs to be accounted for, but I don’t expect Iowa to be as badly hit as a few other places,” he said.
Klowden said the big takeaway from the 2022 report is the way Des Moines bounced back from the previous year.
“Des Moines snapped back from a previous index where there had been a very clear economic impact on the metro, not just jobs but particularly wages in the last index, and it’s clear Des Moines is moving forward and recovering,” he said. “Unless the logistics chain disruption plays itself out in the data for this next year, we’d expect Des Moines to continue to move up, even if not quite as quickly.”
Pictured: The view from the top of 801 Grand. Photo by Emily Kestel
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