Iowa’s manufacturing sector generated nearly $35 billion in real GDP in 2025, more than any other sector in the state, but its contribution to Iowa’s employment growth has fallen over the past two decades, according to a report released Monday, July 23 by the Common Sense Institute Iowa (CSI).
The report, “Made in Iowa: The Outsized Contribution of Manufacturing in the State’s Economy,” was authored by Isaac Flores and Andrzej Wieciorkowski.
Manufacturing employed roughly 216,000 Iowans in 2025, or about 14% of all workers in the state, ahead of health care and social assistance at just over 201,000, the report said. Total wages paid to manufacturing workers reached approximately $16.6 billion in 2025. Manufacturing’s nearly $35 billion in real GDP topped finance and insurance at just over $31 billion.
Iowa is one of four states where manufacturing employs the most workers, down from 35 states in 1990, according to the CSI report. Employment in Iowa is 1.6 times more concentrated in manufacturing than in the United States as a whole. Iowa ranks 31st in population but 23rd in the size of its manufacturing workforce.
In Linn County, the report documented 269 manufacturing locations and 18,385 employees, ranking the county 44th in the Midwest by total manufacturing employment. Polk County ranked 42nd with 500 locations and 18,890 workers. Black Hawk, Scott and Dubuque counties also placed in the Midwest’s top 100.
Statewide, 82.8% of Iowa’s counties had a manufacturing location quotient greater than one in 2025, the sixth-highest share in the nation. Louisa County led the state, with manufacturing accounting for 51.3% of private employment.
From 2005 through 2025, manufacturing was the third-largest contributor to Iowa’s economic growth, adding 10.1% of the state’s GDP growth, compared with 22.1% for finance and insurance and 11.2% for agriculture. Over the same period, the industry’s contribution to total employment growth was -19.2%. Health care and social assistance contributed 43.1% of the state’s net new employment.
The report attributes the trend to productivity gains. It took 7.4 manufacturing workers to produce $1 million in GDP in 2005, compared with 6.1 in 2025, a decline of 21.9%. Nationally, jobs per $1 million of manufacturing GDP fell 29.9% over the same period.
Using the REMI Tax-PI model, the CSI simulated the elimination of all manufacturing employment in Iowa from 2026 through 2030. The scenario projected a cumulative $511 billion decline in GDP, $1.1 trillion in statewide business sales and $234 billion in personal income, costing the state roughly 40% of its current annual output and an estimated 32.8% of its workforce by 2030.
The report concludes that the concentration making manufacturing Iowa’s greatest economic asset “also makes the state unusually exposed to the industry’s structural shifts.”
