1. FUTURE FOR RURAL IOWA Presented at 77 th Annual Soil Management And Land Valuation Conference May 19, 2004 by Kenneth E. Stone, Professor Emeritus of Economics, ISU

2. SOME OF THE PROBLEMS

3. 1. Retail Migration

4. 1980 Iowa County Retail Sales Surplus or Leakage 25 Surplus Counties Four 40%+ Leakage Counties

5. 2001 Iowa County Retail Sales Surplus or Leakage -59% -19% 28%-37% -5% LYON OSCEOLA DICKINSON EMMETKOSSUTH WINNEBAGO WORTH MITCHELL HOWARD WINNESHIEK ALLAMAKEE -24% 6% 5% -36% -18% -20% -21% -40%28% -46% -57% -13% -34% -45% -24% -12% 3% -34% -48% -44% 16% -57% -66% -27% -13% -44% -28% -49% -17% -44% 37% -24% -54% 27% -40% -18% -59% -8% -7% -2% -34% 46% 5% -32% -30% -44% -21% -34% -37% -33% -60% -30% -40% -22% -35% 18% -51% -11% -39% -38% -33% -36% -10% -57% -25% -58% -45% -56% -44% -36% -17% -62% 26% -34% -39% -31% -44% -52% 10% 0% -11% -37% -36% 16% -60% -45% -29% -41% -22% -49% 18% -80% CLAYTONFAYETTE CHICKASAW FLOYD CERRO GORDOHANCOCK WRIGHT FRANKLINBUTLER BREMER DUBUQUEDELAWAREBUCHANAN BLACK HAWK GRUNDY HARDIN HAMILTON WEBSTER HUMBOLDT POCAHONTAS PALO ALTO CLAY BUENA VISTA CALHOUN SACIDA WOODBURY PLYMOUTH SIOUXO'BRIEN CHEROKEE MONONACRAWFORD CARROLL GREENE BOONESTORY MARSHALL TAMA BENTON LINNJONESJACKSON CLINTON SCOTT CEDAR MUSCATINE LOUISA DES MOINES HENRY LEE JEFFERSON VAN BUREN DAVIS WAPELLO KEOKUK IOWA JOHNSONPOWESHIEK JASPERPOLKDALLASGUTHRIE AUDUBON SHELBYHARRISON CASS ADAIR MADISON WARREN LUCASMONROE APPANOOSE MARION MAHASKA WAYNE DECATUR CLARKEUNION RINGGOLD TAYLOR ADAMSMONTGOMERY PAGE FREMONT POTTAWATTAMIE MILLS WASHINGTON 17 Surplus Counties (32) 40%+ Leakage Counties

9. Jewell’s Sales Have Declined by 80% Since 1976

10. Memorabilia of a By-gone Era

11. EVENTS THAT CAUSED BIG CHANGES IN IOWA RETAIL

12. Population Changes

13. Rural Population Iowa 1940195019601970198019902000 0 500 1000 1500 2000 Thousands

14. CountryPlaceFarm Iowa’s Rural Population Source: Dr. Willis Goudy, Census Services

17. Urban Population Iowa 1940195019601970198019902000 0 500 1000 1500 2000 Thousands

18. Urban Population Iowa 1940195019601970198019902000 0 0.5 1 1.5 2 Millions 50,000+ 10,000-49,999 2,500-9,999

19. Shopping Malls

20. Coral Ridge Mall-1.2 Million Square Feet, Approx. $250 Mil Per Year

21. Tanger Factory Outlet Mall-Approx. $100 Mil Per Year

22. North Grand Mall in Ames, 351,000 Square Feet

23. Discount Department Stores

24. SUPER TARGET STORE IN ANKENY, IOWA, 240,000 SQUARE FEET

25. Wal*Mart Supercenter, 220,000 Sq. Ft., Ankeny, IA

26. BIG K MART AT AMES, IOWA

27. Big-Box Building Materials Stores

28. MENARD’S HOME IMPROVEMENT STORE IN ANKENY, IA

29. HOME DEPOT AT ANKENY, IOWA

30. LOWE’S HOME IMPROVEMENT AT AMES, IA

31. Ever Bigger Grocery Stores

32. CUB Food Store, Ames, IA, 65,000 Square Feet

33. HY VEE FOOD STORE LOCATED AT SITE OF FORMER K MART, 70,000 Square Feet

34. WHY IS RETAIL IMPORTANT?

35. The Multiplier Concept of Local Respending Patterns Initial $1.00 of exports 40¢ respent locally 16¢ respent locally 6¢ respent locally 60¢ leakage 24¢ leakage 10¢ leakage 3¢ leakage 3¢ respent locally 2¢ leakage 1¢ respent locally Initial impact: $1.00 $1.00.40.16.06.03.02 Full impact: $1.66

36. Trends of Different Types of Retail Businesses

37. DECLINING BUSINESSES

38. Men’s Apparel Stores Change 1976 to 1998 Figures have been adjusted for inflation. -209

39. Iowa Clothing Stores Change 1976 to 2002 Figures have been adjusted for inflation. -178

40. Iowa Drug Stores Change 1976 to 2002 Figures have been adjusted for inflation. -12

41. CONSOLIDATING BUSINESSES

42. Iowa Department Stores Change 1976 to 2002 Figures have been adjusted for inflation. -74

43. Iowa Grocery Stores Change 1976 to 2002 Figures have been adjusted for inflation. -965

44. Iowa Shoe Stores Change 1976 to 2002 Figures have been adjusted for inflation. -208

45. Iowa Hardware Stores Change 1976 to 2002 Figures have been adjusted for inflation. -451

46. SATURATED BUSINESSES

47. Iowa Used Merchandise Stores Change 1976 to 2002 Figures have been adjusted for inflation. +1,085

48. Iowa Hobby, Toy, Craft Stores Change 1976 to 2002 Figures have been adjusted for inflation. +3,178

49. Iowa Florists Change 1976 to 2002 Figures have been adjusted for inflation. +178

50. Iowa Jewelry Stores Change 1976 to 2002 Figures have been adjusted for inflation. +29

51. Iowa Photo Studios Change 1976 to 2002 Figures have been adjusted for inflation. +531

52. Iowa Auto Parts Stores Change 1976 to 2002 Figures have been adjusted for inflation. +539

53. Iowa Gift & Novelty Stores Change 1976 to 2002 Figures have been adjusted for inflation. +625

54. Iowa Book & Stationery Stores Change 1976 to 2002 Figures have been adjusted for inflation. +248

55. GROWING BUSINESSES

56. Iowa Building Maintenance Firms Change 1976 to 2002 Figures have been adjusted for inflation. +1,028

57. Iowa Auto Repair & Service Firms Change 1976 to 2002 Figures have been adjusted for inflation. +1,338

58. Iowa Beauty & Barber Shops Change 1976 to 2002 Figures have been adjusted for inflation. +358

59. Iowa Eating & Drinking Places Change 1976 to 2002 Figures have been adjusted for inflation. +751

60. Winners and Losers for Small Towns

61. GROWING BUSINESSES IN IOWA TOWNS Population 1,000-2,499, 1987-1997 177.5 156 150 108.6 100 94 90.8 87.5 84.3 76.3 Hobby, Toy, Craft Stores Veterinary Services Music Stores Cleaning & Maintenance Equip. Rental & Leasing Sporting Goods General Construction Book Stores Used Merchandise Plumbing & AC Sales Type of Business 050100150200 Percent Change

62. DECLINING BUSINESSES IN IOWA TOWNS Population1,000-2,499, 1987-1997 -47.6 -46.7 -37.5 -36.7 -35.7 -29.1 -23.8 -23.6 -22.2 -20 Variety Stores Dry Cleaning Plants Gasoline Stations Women's Clothing Stores Department Stores Radio & TV Repair Barber Shops Grocery Stores Shoe Stores Hardware Stores Type of Business 0-10-20-30-40-50-60 Percent Change

64. ANOTHER MAJOR PROBLEM 2. Regional Inequities in Jobs

65. Iowa Per Capita Personal Income Source: Bureau of Economic Analysis

66. Iowa Average Earnings Per Job Source: Bureau of Economic Analysis

67. Average Wage Per Job, 2000 $20,969 $24,564 $25,873 $24,702 $21,648 $21,570 $20,231 $29,418 $21,969 $33,426 $26,018 $22,174 $20,337 $22,432 $22,633 $19,231 $19,728 $25,148 $27,893 $18,477 $20,621 $19,337 $26,590 $21,724 $21,088 $25,716 $22,178 $20,021 $29,220 $26,930 $22,645 $23,405 $33,106 $24,872 $21,914 $24,654 $23,049 $21,434 $20,013 $26,175 $25,824 $26,810 $25,577 $23,642 $21,341 $24,433 $22,142 $19,126 $22,027 $19,612 $22,309 $21,422 $19,015 $22,134 $20,206 $19,561 $21,277 $26,973 $25,713 $21,480 $21,176 $20,469 $22,185 $22,987 $26,219 $18,718 $21,344 $24,461 $17,431 $18,444 $21,316 $23,352 $24,732 $20,883 $28,414 $22,657 $21,566 $22,875 $26,818 $19,624 $24,078 $27,978 $30,934 $23,678 $25,859 $22,087 $23,166 $22,368 $22,088 $24,776 $20,583 $22,451 $22,349 $27,665 $19,724 $22,196 $22,368$21,169 $23,518 LYON SIOUX PLYMOUTH WOODBURY MONONA HARRISON POTTAWATTAMIE MILLS FREMONT PAGETAYLORRINGGOLD DECATUR WAYNE APPANOOSE DAVIS VAN BUREN LEE DES MOINES HENRY JEFFERSON WAPELLO MONROE LUCAS CLARKE UNION ADAMS MONTGOMERY CASSADAIR MADISON WARREN MARION MAHASKA KEOKUK WASHINGTON LOUISA MUSCATINE SCOTT CLINTON JACKSON JONES CEDAR LINN JOHNSON BENTON IOWA TAMA POWESHIEKJASPER MARSHALL STORY POLK DALLAS BOONEGREENE GUTHRIE AUDUBON CARROLLCRAWFORD SHELBY IDA SAC CHEROKEE BUENA VISTA POCAHONTASHUMBOLDT KOSSUTH CALHOUN WEBSTER HAMILTON HARDINGRUNDY BLACK HAWK BUCHANAN DELAWARE DUBUQUE CLAYTON ALLAMAKEE WINNESHIEK FAYETTE HOWARD MITCHELL WORTH WINNEBAGO HANCOCK CERRO GORDO FLOYDCHICKASAW BREMER BUTLER FRANKLIN WRIGHT EMMET PALO ALTO DICKINSON CLAY OSCEOLA O'BRIEN 2000 Average Wage Per Job 75% of state average or below Less than state average (at least 75% of state average) Greater than state average

68. Average Manufacturing Earnings Per Employee (in 2000 Constant Dollars) Source: Bureau of Economic Analysis

69. Iowa Average Manufacturing Earnings Per Employee (i n 2000 Constant Dollars) Source: Bureau of Economic Analysis

70. Government Earnings as a Percent of Total Earnings, 1980-2000 Source: Bureau of Economic Analysis

71. Iowa Government Earnings as a Percent of Total Earnings, 1980-2000 Source: Bureau of Economic Analysis

72. Average Net Farm Proprietor’s Income (in 2000 Constant Dollars) Source: Bureau of Economic Analysis

73. Iowa Average Net Farm Proprietor’s Income ( in 2000 Constant Dollars) Source: Bureau of Economic Analysis

74. 2000 Farm Payments Per Capita $3,080 $462 $303 $1,310 $1,479 $1,302 $1,709 $795 $1,775 $131 $826 $1,389 $1,786 $1,338 $1,778 $2,626 $1,078 $764 $175 $941 $3,456 $1,718 $270 $1,794 $2,142 $1,242 $1,300 $2,246 $465 $566 $1,536 $2,834 $45 $2,162 $381 $650 $1,485 $1,244 $1,782 $671 $354 $1,452 $942 $1,516 $1,262 $1,714 $1,776 $2,147 $1,181 $2,178 $2,615 $1,838 $2,521 $2,569 $2,723 $1,907 $1,266 $193 $2,579 $1,715 $905 $2,139 $1,464 $1,933 $378 $1,875 $556 $2,228 $969 $2,096 $1,215 $1,089 $2,415 $1,272 $129 $2,099 $2,086 $2,274 $879 $2,875 $334 $904 $429 $1,024 $918 $824 $1,053 $783 $937 $2,410 $2,476 $1,320 $2,911 $318 $1,939 $1,281 $927 $2,914 $1,881 LYON SIOUX PLYMOUTH WOODBURY MONONA HARRISON POTTAWATTAMIE MILLS FREMONT PAGETAYLORRINGGOLD DECATUR WAYNE APPANOOSE DAVIS VAN BUREN LEE DES MOINES HENRY JEFFERSON WAPELLO MONROE LUCAS CLARKE UNION ADAMS MONTGOMERY CASSADAIR MADISON WARREN MARION MAHASKA KEOKUK WASHINGTON LOUISA MUSCATINE SCOTT CLINTON JACKSON JONES CEDAR LINN JOHNSON BENTON IOWA TAMA POWESHIEKJASPER MARSHALL STORY POLK DALLAS BOONEGREENE GUTHRIE AUDUBON CARROLLCRAWFORD SHELBY IDA SAC CHEROKEE BUENA VISTA POCAHONTASHUMBOLDT KOSSUTH CALHOUN WEBSTER HAMILTON HARDINGRUNDY BLACK HAWK BUCHANAN DELAWARE DUBUQUE CLAYTON ALLAMAKEE WINNESHIEK FAYETTE HOWARD MITCHELL WORTH WINNEBAGO HANCOCK CERRO GORDO FLOYDCHICKASAW BREMER BUTLER FRANKLIN WRIGHT EMMET PALO ALTO DICKINSON CLAY OSCEOLA O'BRIEN 2000 Farm Payments Per Capita Less than state per capita Greater than state per capita More than twice state per capita

75. FUTURE FOR RURAL IOWA As global economy expands, perhaps ag will become truly profitable and less dependent on government payments Improvements in telecommunications (Internet) will expand markets for rural prople.

76. FUTURE FOR RURAL IOWA (Continued) Rural Iowa will have to come to grips with excess government. Will have to consolidate schools, court houses and other services. Local jurisdictions will have to pool resources with others and work as regions.

77. FUTURE FOR RURAL IOWA (Continued) Rural Iowa will have to continue to develop and promote its recreational and tourism strengths. Rural Iowa will have to vigorously promote and recruit younger families from urban areas on the basis of a better quality of life.

78. FUTURE FOR RURAL IOWA (Continued) Rural Iowa must capitalize on the benefits of technology. High speed internet should be omnipresent. Rural Iowans should be able to communicate with the world in the most modern way possible. We’ve got to find some way to attract and retail young people in order to reinvigorate the state.

79. FOR ADDITIONAL INFORMATION Contact: Kenneth E. Stone Professor Emeritus of Economics 2208 Van Buren Av. Ames, IA 50010 Phone: (515) 232-7766 Fax: (515) 232-4127 E-mail: kstone@iastate.edu Web: www.econ.iastate.edu/retail