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Iowa Economic Forecast Projects Iowa Income Growth in 2004

According to its latest Iowa Economic Forecast, the University of Iowa Institute for Economic Research expects real personal income growth of 3.2 percent in 2004, up from a forecast of 2.8 percent in May. For 2005, the Institute projects real income growth in the state to be 1.9 percent, down from 2.4 percent in the May forecast.

Charles Whiteman, institute director and UI professor of economics, said the forecast is based on state income data through the second quarter of 2004.

"We anticipate real income growth in 2004 to be a bit stronger than we had previously thought," Whiteman said. "The forecast for 2004 income growth was revised upward, and the growth forecast for 2005 was revised downward by essentially the same amount. So, the current prediction is that we'll be in the same place by the end of 2005, but will have more of the growth sooner."

The institute's forecast for employment shows a rather slow recovery of the job market in Iowa. The forecast for 2004 is for a growth rate of only 0.5 percent in employment, down from 1 percent in July, and an increase of 0.9 percent in 2005, down from 2.1 percent in July.

The Board of Regents, State of Iowa created the Institute for Economic Research in July 1975 to facilitate cohesive and continuing economic research, and to establish a formal mechanism for providing interaction with, and economic research services to, government and industry. Each quarter, the institute produces the Iowa Economic Forecast, which contains quantitative forecasts of economic conditions and tax revenues for the State of Iowa, using the latest advances in econometrics.


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