Cedar Rapids: Economy
Major Industries and Commercial Activity
The economy of Cedar Rapids has traditionally been based on the manufacture and processing of agricultural and food products, steel fabricating, tool and die making, and radios and electronics. Manufacturing, which continues to be an important economic sector, has been augmented by high-technology industries and transportation. The Cedar Rapids-Iowa City "Technology Corridor" is one of the leading centers in the country for the defense electronics industry; the fastest-growing segment of the metropolitan area economy is telecommunications and telemarketing. Advanced research and development laboratories, an educated and productive labor force, and a mid-continent location are increasingly attracting new business and industry to Cedar Rapids.
The city's association with high technology dates to the early years of Collins Radio Company. Today, Collins is part of Rockwell Collins, ranked as the largest employer in the Cedar Rapids-Iowa City region. The company provides aviation electronic and communication technology for government, aircraft manufacturers, and hundreds of airline customers. In fact, the company's aircraft electronics are used in almost every airline in the world. Additionally, Rockwell Collins' communication systems transmit almost 70 percent of all U.S. and allied military airborne communication.
In recent years, a number of local public and private organizations joined together to help develop the "Technology Corridor." This hub for technology companies is located throughout 12 communities in Johnson and Linn Counties. Its location near a number of colleges and universities enables Corridor companies to easily access education, training, research, and development. Local firms provide a variety of services such as electronic design and consultation, systems planning, equipment manufacturing, and telemarketing.
While Cedar Rapids has seen tremendous growth in technology, the city continues to succeed in attracting agricultural and food processing manufacturers. It is home to more than 275 different manufacturing plants, including Quaker Food and Beverages, which runs the world's largest cereal milling plant. Other top manufacturing employers include Amana Refrigeration Products, General Mills, Inc., and H.J. Heinz Company.
Items and goods produced: cereal, syrup, sugar, dairy, mining, and road machinery, boxboard and containers, automotive tools and machinery, radio electronics and avionics equipment, oil burners, furniture, pumps, gravel crushers, cranes, snow plows, electric-powered shovels, trailer parts, candy, office and drainage equipment, rubber goods, plastic bags, recycled corrugated cardboard, copper alloy and plastic molding, medical and chemical products, plumbing supplies, auto parts and toys, furnaces, livestock feed, structural steel, compressed gas, pharmaceuticals, avionics and earth-moving equipment, telecommunications equipment, home appliances
Incentive Programs—New and Existing Companies
The Cedar Rapids Area Chamber of Commerce and its divisions are active in implementing growth plans, helping existing businesses, and recruiting companies from throughout the world. Its economic development division, Priority One, provides businesses with demographics and trade figures, site location assistance, and workforce development.
Part of the private-public partnership Cedar Rapids fosters is evident in such state programs as certain property tax exemptions, job training, low-interest loans and forgivable loans for business development, tax abatements on new research and manufacturing facilities, and state tax credits for new job creation. In addition, no sales or use taxes are assessed on equipment or computers and open port warehousing is available.
Job training programs
Cedar Rapids area businesses can take advantage of the Iowa Industrial New Jobs Training Program administered by Kirkwood Community College, which provides education and training for new employees of new and expanding companies at little or no cost.
Many companies have recently been relocating to or expanding current operations in the Cedar Rapids area. Nordstrom is expanding its existing fulfillment center by adding 39,000 square feet of space and creating 275 full-time positions. U.S. Cellular is expanding its engineering and customer call center, adding 15,000 square feet and 100 new jobs. Iowa Glass Co. is in the process of building a new $10 million corporate headquarters and distribution center, and German fiber manufacturer J. Rettenmaier & SMhne recently announced plans to build a dietary fiber production facility in the city.
Economic Development Information: Priority One, Economic Development Division, Cedar Rapids Area Chamber of Commerce, 424 First Avenue NE, Cedar Rapids, IA 52401; telephone (319)398-5317; email firstname.lastname@example.org
A central location, efficient access, and low supply and distribution costs have contributed to the development of Cedar Rapids as a primary transportation hub in the Midwest. The city is at the center of the NAFTA corridor, and international connections are readily accessible. Additionally, Eastern Iowa Airport is a designated Foreign Trade Zone. The 3,200-square-acre airport served one million passengers in 2000, a milestone in its history. A leader in exporting goods, Cedar Rapids works closely with top importers in Canada, Japan, Mexico, Germany and France. Iowa is the only state bordered by two navigable rivers, and many area exports leave via water.
Cedar Rapids' rail system also provides transportation services to many businesses. The Union Pacific East-West mainline travels through the city, as well as the Canadian Pacific Railway and the Cedar Rapids and Iowa City Railway. The lines interchange with a number of major national airlines serving all of North America. In addition, Cedar Rapids is the only area able to serve Minneapolis, Chicago, St. Louis, and Omaha by freight carrier within a one-day round trip. More than 34 motor freight carriers with terminals located in the area provide interstate, intrastate and local freight services.
Labor Force and Employment Outlook
With an educated, available, and skilled workforce, Cedar Rapids maintains a productivity rate that is substantially above the national average. Absenteeism is less than 1 percent and industrial turnover is less than 1.5 percent. Area workers produce 20 percent more than the average American worker and score high in rankings of annual value added per production worker. With 69 percent of the workforce having education beyond high school, and 48 percent having an undergraduate degree or higher, local businesses have a large pool of educated workers to choose from. And in order to further train those workers, Cedar Rapids area businesses can take advantage of the Iowa Industrial New Jobs Training Program, which provides education and training for new employees of new and expanding companies at little or no cost. The program is administered by Kirkwood Community College.
The following is a summary of data regarding the Cedar Rapids metropolitan area labor force, 2004 annual averages.
Size of nonagricultural labor force: 129,500
Number of workers employed in . . .
construction and mining: 7,100
trade, transportation, and utilities: 28,100
financial activities: 9,700
professional and business services: 12,300
education and health services: 16,000
leisure and hospitality: 10,600
other services: 5,300
Average hourly earnings of production workers employed in manufacturing: $16.08 (statewide average)
Unemployment rate: 5.9% (February 2005)
Cost of Living
Cedar Rapids's property taxes are the second-lowest of the state's eight largest cities with more than 50,000 people.
The following is a summary of data regarding several key cost of living factors in the Cedar Rapids area.
2004 (3rd Quarter) ACCRA Average House Price: $221,000
2004 (3rd Quarter) ACCRA Cost of Living Index: 94.2 (U.S. average = 100.0)
State income tax rate: Ranges from 0.36% to 8.98%
State sales tax rate: 5.0%
Local income tax rate: None
Local sales tax rate: None
Property tax rate: $34.50 per $1,000 of assessed valuation for properties within the Cedar Rapids Community School District; 51.6676% of the assessed value is subject to the property tax rate; therefore, a $100,000 house would be taxed as if it were valued at $51,667
Economic Information: Cedar Rapids Area Chamber of Commerce, 424 First Avenue NE, Cedar Rapids, IA 52401; telephone (319)398-5317.
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