Swenson on farm location and profitability

December 24, 2020

David SwensonDavid Swenson, research scientist, was interviewed for a Dec. 20 Des Moines Register story, "Iowa group aims to plant small farms around the state's cities, boosting sustainability efforts and 'food resiliency'."

Dave Swenson, an Iowa State University economist, said produce and livestock farms have the best shot at profitability when they're located near heavily populated areas.

"Three million dollars doesn't buy a lot of Iowa farmland, but it does perhaps create the start of what could be a movement of land preservation," said Swenson, who was a SILT board member until last year.

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Swenson was also interviewed for a Dec. 22 Bank Beat story, "Retail suffers from ‘Great Suppression’, spurring transformational change."

“What’s most evident is that we have a substantial number of commercial businesses closing,” said Dave Swenson, an economist at Iowa State University. “You can see it in small towns. You can see it in medium-sized cities like Ames, Iowa, and you see it in Des Moines. You see a lot of “for rent” signs that a year ago had businesses in them, especially restaurants and small shops.”

The economies of larger metros such as Des Moines, Omaha and Kansas City, which were soaring heading into 2020, will buoy many industries, Swenson said. But most expansion plans or new buildings have been put on hold “as people are working out of their living rooms,” Swenson said.

“I believe a larger fraction of those places are going to find themselves in bankruptcy or are just simply going to walk away from their lease and stop doing what they’re doing,” Swenson said. “The last business to close is going to be the bar. And what did we do during the pandemic? We said you couldn’t go to the bars.” 

Swenson was also interviewed for a Dec. 29 Patch.com story, "Iowa's College Enrollment Dropped In 2020. Trends Point To A Continuing Decline."

Though enrollment may have dropped this last year, Iowa's biggest workforce challenge is the decades-long trend of "brain drain," where high-skilled adults are leaving the state in search of jobs, Swenson said.

Historically, Iowa's agricultural industry has drawn in higher rates of low-skilled workers who come to work in food processing, while the state's young, skilled workforce leave in search of jobs. The state's economy has long prioritized the ag industry, Swenson said.

"We educate the hell out of our young people," Swenson said. "We just don't have the industrial structure to keep them."

And in a Jan. 4 Iowa Public Radio interview, Iowa State University economist Dave Swenson says most of the drop is not from people getting back to work — it’s from people giving up their job search. “The most important factor driving that rate down is not more people working, it’s people leaving the labor force and not working or not looking for work,” Swenson says.
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