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Iowa's economy to experience moderate growth in 1997 and 1998
IOWA CITY, Iowa -- The Iowa Economic Forecast, released today by The
University of Iowa Institute for Economic Research, predicts moderate growth
for the Iowa economy for 1997 and 1998. The report was prepared for the
Iowa Economic Forecasting Council, which received it today in Des Moines.
According to the Institute, Iowans' real personal income (that is, adjusted
for inflation) grew about 3.6 percent during 1996. The forecast indicates
that real personal income will grow an additional 2.4 percent in 1997
and 2 percent in 1998.
Institute Director Charles H. Whiteman said that the 1996 figure was
in accord with earlier predictions. "Growth at 3.6 percent is quite
strong for a year when we were not recovering from a recession, flood or
drought," he said.
Nonfarm employment is predicted to grow about 1.5 percent in 1997 and
just under 1 percent during 1998. As has been true in recent months, the
service sector will show the strongest growth, and manufacturing of nondurable
goods will be the weakest.
The Institute also released state tax revenue forecasts. Whiteman indicated
that the Institute's model predicts that fiscal year 1997 revenue growth
could be between 5 and 5.5 percent, very much in line with the state's
official forecast of 5 percent. He cautioned that the uncertainties surrounding
revenue forecasts are large. The state's Revenue Estimating Conference
will meet in April to consider whether to change the official estimate.