It doesn’t take a degree in economics to understand that 2023 was among the most challenging on recent record for businesses of all sizes. Interest rates were high, prices were up and available labor was extremely hard to find.
Yet, organizations said economic activity and growth left a lot to smile about as the business community fared reasonably well compared to other cities.
Reason for Optimism
Heading into the new year, organizations said members are enjoying something other cities are finding in short supply — optimism.
“The biggest win for Omaha and the region during 2023 has been our steady, strong growth despite challenging national economic headwinds,” said Heath Mello, president and CEO of the Greater Omaha Chamber. “We are seeing our existing companies continue to invest and grow their enterprises, as well as indicate they will continue to grow in 2024.
“Several marquee projects have been completed or are continuing their development process this year. The Riverfront park system opened, steel is coming out of the ground on the Mutual of Omaha headquarters tower, and the final preparations to begin the modern streetcar project in the first half of 2024 are nearly complete. These investments are going to pay dividends for Omaha for years into the future by redefining placemaking and helping us attract new residents and businesses to the urban core.”
Across the river, the story was largely the same.
“I would say we are on an upward trend,” said Alicia Frieze of the Council Bluffs Area Chamber of Commerce. “Our labor pool increased, and we saw turnover with our members in our local businesses decline. I definitely think things are shifting back to pre-pandemic levels.”
She noted the new cold storage facility, as well as Amazon, opening as key players in increasing available jobs. The steps the city has taken to make Council Bluffs an attractive place to live has also helped.
“We were very fortunate that a few years ago the Iowa Economic Development Authority paid for a comprehensive survey of visitors,” Frieze said. “Some of the things that visitors like and want is outdoor recreation, school systems are really important, parks are really important to them.
“We’ve really used that information and homed in on it making sure we are emphasizing our 45 miles of trails in our community, the number of parks, our amazing school system, and the new child care development centers that we are establishing in our community.”
Sarpy County continues to grapple with a shortage of available labor despite what Karen Gibler, president of the Sarpy County Chamber, described as a robust master plan and available ground for development.
“The first solution is technology and utilizing technology to optimize workflow,” she said. “For example, a robot waitress in a restaurant that delivers food. That’s just one way to try and come up with ways to utilize technology to make a business more efficient. We try to do educational classes on different opportunities to optimize business owners’ time.
“The other thing is we try to be an avenue for our membership base to post opportunities on our website. If you’re a member of the chamber, you can post unlimited job postings. We’re also working with the high schools in job training and job exposure. We’ve spent the last several years helping the Papillion/La Vista schools market the trades, educating parents on the benefits of getting 100% paid tuition and these great jobs where the kids want to work with their hands.”
Pam Myers, owner of Express Employment Professionals in Council Bluffs, said she’s seen improvement in the labor pool, which bodes well for the coming year.
“Wage acceleration has definitely tapered off during this year compared to the rapid escalation observed in our market over the last four or five years,” she said.
“It had been difficult in many cases to fulfill labor requirements due to the worker shortage between 2017 and 2022. We are seeing an increase in the number of prospects looking for work across multiple skill levels. The companies we support can be more selective in finding the right candidate. Overall, I would give the situation a solid B and say it’s definitely improving.”
Choppy Waters Ahead?
If it seems incongruous to see such growth and expansion at a time when inflation and interest rates are increasing, Dr. Ernie Goss, McAllister chair and professor of economics at Creighton University, said the explanation is simple.
“I’ve heard a lot of folks say, ‘This economy is a mystery.’ Well, it’s really not a mystery,” he said.
“What’s happened is we had the Trump stimulus plan, we had the Biden stimulus plan and now we have the current overspending by the federal government whereby we’re going to have a $1.5 to $2 trillion deficient potential this year. We have a federal government with wartime deficits and wartime spending for a peacetime economy. That’s what’s holding things up.”
Goss said the level of construction that’s visible everywhere in the Omaha metro is also misleading.
“Some decisions were made well before the increase in interest rates,” he said.
“Unfortunately, there’s going to be a payback on some of that when your construction comes online and there’s nobody to fill the office space that you just built or you may not have residents for the multi-family housing that you just built.”