Iowa is celebrated for its strong Midwestern work ethic and business-friendly policies. The state’s strategic location and renowned research institutions make it attractive for start-ups or businesses that would like to expand or relocate. With significant competitive advantages such as low operating costs, ample raw materials, and a robust transportation network, businesses in Iowa are well-positioned for success. But what are the emerging sectors in Iowa, and which ones are set to thrive in the upcoming year? Read on to find out.
Agriculture & Food Production
Iowa’s reputation as a powerhouse in agriculture is well-established and poised for growth in years to come. There are over 85,000 farms in Iowa, 747 of which are USDA-certified organic farms. The state’s top agricultural products include corn, pork, chicken eggs, soybeans, and red meat. The state is known for producing one-fourteenth of the nation’s food supply, which can’t be undermined.
In addition to selling their products nationwide, major companies in the state also export a considerable volume of products overseas. This success is thanks to the high-quality feed ingredients used by the state’s farmers, which support strong animal production. Iowa is also a critical player in the global market, hosting international and national companies focused on beef, dairy, poultry, and more. These sectors are complemented by food processing, packaging, and the production of food ingredients.
Gambling Industry
The Midwest has a bad reputation when it comes to gambling. In some states, most forms of gambling are still prohibited except for a few riverboat casinos. Gambling expansions are also viewed with skepticism in the Midwest. For example, while online gambling generates significant revenue for states like New Jersey, in many Midwestern states, it remains tightly controlled or is outright banned.
Fortunately, that’s not the case with Iowa! Unlike other states, Iowa does not have a specific set of laws that explicitly prohibit online gambling activities. While this is not uncommon in the US, as many states lack legislation specifically addressing online gambling websites, it remains a place where people can gamble more easily using technology.The state has many fantastic online entertainment platforms available, and the industry’s growth is promising. If Iowa were to regulate this industry in 2025, it could create a substantial revenue stream for the state, similar to other states that have legalized online gambling. However, this doesn’t seem to be the case for now, but it is not necessarily bad. The online casino industry is thriving in Iowa, and there have been no reported instances of residents facing legal issues for playing casino games online.
Renewable Energy & Fuels
Iowa ranks among the top states in the US regarding renewable energy, notably in wind energy and biofuels. In addition to being the leading state in fuel ethanol production in the United States, Iowa accounts for over one-fourth of the country’s total fuel ethanol production capacity. The state has 41 ethanol production facilities that can generate approximately 4.9 billion gallons annually. This production volume is significantly higher than the 189 million gallons of ethanol consumed within the state each year.
In terms of overall renewable energy, Iowa ranks second in the US after Texas. In 2023, about three-fifths of the state’s total electricity net generation came from renewable resources, almost all of it from wind. This is partly thanks to the favorable wind speeds in the state making it a good candidate for wind-generated power.
The rest of the renewable energy production came from solar, hydroelectric power, and biomass. According to these metrics, these sectors will continue to grow, and Iowa is on a clear path toward fossil fuel independence.
Advanced Manufacturing
As Iowa’s largest industry, advanced manufacturing injects $38.6 billion annually into the state’s economy with exports of over $26 billion worth of goods. Manufacturing represents 18% of Iowa’s GDP and over 220,000 Iowans are employed in the sector, constituting over 14 percent of the state’s workforce. Iowa’s advanced manufacturing sector comprises industrial metal processing equipment, automation machinery, and environmental control systems. Other significant areas include the manufacturing of commercial vehicles, food ingredients, and medical devices. Connected through a robust transportation network with access to air, water, rail, and highway, Iowa is perfectly positioned to export products around the globe. In 2025, Iowa’s status as a hub of industrial innovation and production will most likely be strengthened.
Distribution & Warehousing
Strategically located in the heart of the United States, Iowa offers a logistical advantage that is hard to match. The extensive transportation network, including major highways, railroads, and airports, enhances the state’s ability to efficiently manage the flow of goods in an eight-state market of nearly one million businesses and thirty-five million people. This infrastructure supports the current market demands and is scalable to meet future logistic needs. With over 4,100 establishments in this sector generating $50 billion in sales and employing tens of thousands, Iowa is set to remain at the forefront of distribution and warehousing solutions in the United States in 2025 for both domestic and international markets.
Iowa Is Thriving
Looking ahead to 2025, Iowa is set to continue its legacy industries and seize new growth opportunities. The state’s economy is solid, well-equipped to face future challenges, and ready to leverage new opportunities across diverse industries. Thanks to forward-thinking initiatives, Iowa is set to continue flourishing in the highly competitive global market.