It didn’t take long for national figures to predict the death of Iowa’s first-in-the-nation status amidst the ongoing delay of final results from the Democratic Iowa caucuses – heck, people have been forecasting the change for years before this incident. It also didn’t take long for Iowa leaders – Republicans and Democrats alike – to come to Iowa’s defense. 

But what would it mean from an economic standpoint if Iowa did indeed lose its place as the first state to vote in the presidential nominating process? One figure projected an $11.3 million economic impact in just the Des Moines metro alone this caucus cycle. 

Josh Rosenbloom, chair of Iowa State’s economics department, said there would be an impact, but it’s unclear how big it would be. “What’s clear is a lot of money is spent on advertising in the state. … A lot of grassroots organizers are hired here. And the hotel and restaurant businesses would suffer.”

“You have to think about both very explicit things, which would be a traveler coming here and spending money at a hotel or spending money at restaurants … but then you have to think about implicit things also, and that’s the thing that’s much more difficult to measure,” said Thomas Root, associate professor of finance at Drake University. “News stories on national media that paint Iowa in a positive light, assuming it’s positive, is very difficult to put a dollar figure on.” 

National recognition for the state is a mixed bag. Rosenbloom said people are more aware of Iowa every four years than they are Missouri or Nebraska, but that doesn’t necessarily lead to more people coming here. The bigger loss, he said, would be no longer having candidates’ attention on issues facing Iowa, especially in rural communities. 

“Amy Klobachar said she made it to all 99 counties during the last year. She did a broader statewide approach than some of the other campaigns did,” Root said. “For dollar impact, it probably has a bigger impact on the more urban areas.” 

Whether candidates will consider pouring in the same millions of dollars in Iowa for future caucuses will depend on the final results reported by the Iowa Democratic Party, Root said. 

“If a candidate like Bloomberg is successful who avoids the caucuses -- if a candidate who avoids the caucuses and wasn’t here is successful, then that might change people’s decision to participate,” Root said. 

At least one Midwest state is preparing for the switch from a caucus-to-primary firsthand: Minnesota will debut its state-administered primary system for presidential candidates on March 3 after the 2016 caucuses led to hour-long lines and a ballot shortage, the Minnesota Post reported in 2019. Although final campaign spending in this cycle won’t be available until after the state primaries, campaigning may turn out to be more expensive, state chair Ken Martin told the Post. 

For now, Root is waiting to see how Iowan perceptions will hold as more information is released. 

“If you look out six months from now or a year from now, there’s always people looking for reasons to change the process. How well that stays and takes hold I think will be interesting to see,” he said.