In case you haven’t noticed, Iowa’s economy is struggling. We’re not in a recession, but things have been trending down for some time.

Farm commodity prices are sagging, and our minimum wage is among the lowest in the nation, and for some unexplained reason, there is a reluctance among our Republican leaders to ask for and to spend federal money that other states receive.

As a result, we seem to be falling further and further behind.

Our problems are highlighted in a recent government report that measures changes in the gross domestic product and personal income.

According to the U.S. Bureau of Economic Analysis, Iowa’s gross domestic product, which is the output of all goods and services, grew 1.3% last year, barely half the national average of 2.5%. We ranked 42nd among the 50 states.

Iowa’s personal income growth was 3.7%, compared with a national average of 5.2%. Only two states had lower, slower growth.

Iowa’s own economic measures have shown similar problems for some time.

The Iowa Department of Revenue’s Leading Indicators Index started falling two years ago when we began losing grain exports to Europe, Asia and Latin America after the Russians invaded Ukraine and closed off its grain markets.

The index’s decline leveled off last fall and pretty much remained stable through March, which is the most recent month for which data is available.

In March, three of the index’s eight indicators were positive – diesel fuel consumption, an Iowa stock market index and weekly manufacturing hours.

But five indicators were negative – weekly unemployment claims, residential building permits, new manufacturing orders and farm profits. The ag numbers showed corn and soybean profits were the worst they’ve been in three years.

In addition to agriculture, another significant problem facing Iowa is the collapse of insurance and finance as growth engines.

The BEA’s GDP numbers show a 14% decline in the past three years, from $31.2 billion to $26.7 billion in the value of Iowa’s insurance and finance activities.  

The year 2021 marked the end of a four-decade upward curve for insurance and finance operations in Iowa. Those activities began increasing following the 1980s Farm Crisis, when Iowa insurers led by Principal Financial Group and Equitable of Iowa jumped into the growing baby-boomer retirement market with 401(k) plans and annuity products. 

Iowa Gov. Terry Branstad spurred the growth by traveling around the country and the world to promote Iowa and by lowering regulatory requirements.

On the banking side, Des Moines native Richard Levitt was a magician. After selling his family’s highly successful Dial Finance Corp. in 1982 to Minneapolis-based Norwest Bank, he settled in as a top Norwest executive and restructured the bank’s failing home mortgage portfolio. Levitt placed former Dial executives in charge, and Dial veteran Mark Oman grew the business from Des Moines to become the nation’s largest home mortgage lender after Norwest acquired San Francisco-based Wells Fargo and adopted the Wells Fargo name.

The Des Moines Register’s Tyler Jett chronicled the decline of Iowa’s once mighty finance and banking industries earlier this year.

Jett noted that the self-inflicted wounds of Wells Fargo executives in San Francisco resulted in nearly $4 billion in fines for questionable marketing practices that damaged its home mortgage business.

Since 2017, Jett wrote, Wells Fargo has eliminated 1,400 jobs in Iowa, sold its mortgage headquarters on Westown Parkway in West Des Moines and put three downtown office buildings on the market.

The insurance industry, by contrast, has not suffered from strategic mistakes but evolving technologies have significantly changed the number of employees needed to handle underwriting, premium payments, claims processing and other formerly labor-intensive operations.

Jett also wrote that the Iowa labor market that once produced a steady stream of low-wage workers moving from small Iowa towns to Des Moines has pretty much dried up. 

Add it all up, and you’ll find that, like the Paul Simon song says: We believe the economy is “gliding down the highway, when in fact we’re slip-sliding away.”