How big is Iowa’s construction sector?
The construction sector’s 116,000 full-time and part-time jobs accounted for nearly 6 percent of all Iowa jobs in 2014. Most of those jobs are found in very small firms; more than 90 percent of Iowa construction firms have fewer than 5 employees.
Three out of four construction entities are classified as nonemployer firms, with no paid employees other than the owner(s). Of more than 8,400 firms with employees on payroll, about half are organized as S-corporations.
Measured by gross domestic product (GDP), which includes payments to workers and returns to owners and investors, the construction sector contributed more than $7 billion toward Iowa’s economy in 2014, accounting for 4.2 percent of total GDP. (See Table 1.)
What industries and activities are included within the construction sector?
It’s a diverse mix of business establishments engaged in the construction of buildings; heavy and civil engineering projects such as roads and bridges; and specialty trades such as masonry, electrical work and plumbing, roofing, painting, and finish carpentry.
Specialty trades firms account for the largest share of activity within Iowa’s construction sector, tallying 66 percent of jobs and 48 percent of the value of sales generated. Building construction firms account for 23 percent of jobs and 32 percent of sales. Heavy or civil engineering construction firms account for 11 percent of construction sector jobs, but they generate 20 percent of the value of construction sector sales. (See Figure 1.)
How are Iowa’s construction sector firms and sales distributed geographically?
Iowa’s construction firms are split almost evenly between metropolitan and nonmetropolitan territories, with the distribution by county aligning closely with population. Nonmetropolitan counties average nearly 13 construction firms per 1,000 residents. In metropolitan areas, the average is closer to 10.
Based on U.S. Census Bureau data from 2012, construction work performed within Iowa accounts for 80 percent of sales or receipts going to Iowa construction firms. The in-state percentage is slightly lower for heavy and civil engineering construction (78 percent) and higher for specialty trade contractors (82 percent). Work done in neighboring states accounts for about 9 percent of Iowa’s construction sector sales overall. Illinois and Nebraska are the largest markets outside of Iowa, each accounting for 3 percent of sales.
Who works in Iowa’s construction sector?
Construction laborers comprise the largest share of the sector’s workforce, accounting for 15 percent of workers. Carpenters are second with 8 percent of jobs, followed closely by office and administrative support workers.
This article was compiled by Iowa State University economist Liesl Eathington for publication in the Spring 2016 edition of CIRAS News. You can read more of that or other editions of CIRAS News elsewhere on our website.