State GDP shrank 6.1% on inflation-adjusted basis

DES MOINES - The Bureau of Economic Analysis’ quarterly state GDP numbers  showed Iowa’s economy shrank substantially in the first quarter. In March, data showed Iowa was only one of two states to have its economy contract in 2024. Wallethub recently named Iowa’s economy the worst in the nation. Unfortunately, the new GDP numbers continue to paint a grim picture.

• In real, inflation-adjusted terms, Iowa’s economy contracted 6.1% in the first quarter of 2025, 49th in the country. Nebraska was 50th. (Table 1: “Real gross domestic product, percent change from the preceding period”)
• The category of “Agriculture, forestry, fishing, and hunting” was the leading contributor of the declining 4.84% (Table 2: “Contributions to Percent Change in Real GDP…”)
• The Iowa Farm Bureau has previously noted that declines in the ripples from declines in farm income are projected to cut up to 11,400 jobs and slash $1.5 billion from Iowa’s economy. Congress has not passed a new Farm Bill in almost seven years.

“Iowa under the clique of insider Republicans in Des Moines and DC is falling behind the rest of the country and going in the wrong direction,” said Iowa Democratic Party Chair Rita Hart. “Instead of changing course, the Republican leaders of our state are supporting tariffs that drive up prices and close markets, voting for a budget bill that will cut trillions of dollars in health care funding threatening rural hospitals, and piling up more deficits and debt by extending huge tax breaks for the wealthy and special interests. It’s time for change. Iowa Democrats are ready to offer new leadership and new energy to turn our state around.”