Uncertainty Top Challenge For Iowa Businesses

Uncertainty, be it due to geopolitical conflict, global market turmoil or rapid shifts in federal government policy, has replaced workforce attraction and retention as the biggest challenge facing leaders of Iowa’s biggest companies, according to results of ABI’s annual CEO Survey.

Fifty-nine percent of the respondents to the 2025 survey chose “uncertainty” from a list of challenges, compared to 46% who chose “workforce.” That’s a marked change from 2024, where 51% of the 74 responding CEOs ranked workforce as their biggest challenge.

Survey results from this year also show a more bullish outlook on Iowa’s economy than on the nation’s. Sixty-one percent of respondents rated Iowa’s economy as “stable,” 23% rated it “strong” and just 13% rated it “weak.” In contrast, 50% rated the U.S. economy “stable" and 34% rated it “weak,” with just 13% calling it “strong” and 1% rating it “very strong.”

Other data points from the survey:

• The number of Iowa CEOs who say their business is growing is almost equally matched by those who say their business is flat, with more than 15% seeing downturns or struggles.

• Acceptance of artificial intelligence (AI) by Iowa businesses is increasing. Some 96% of respondents indicated they were either considering, starting to implement or are already integrating AI applications and technology into their operations, compared to a 70% positive response last year to a similar question.

Survey data on tariff impacts and opinions, health insurance premium trends, work-based learning partnerships and open-ended responses about policy and ABI support will be shared in full at ABI’s Executive Forum in August.

For perspective on how Iowa’s business leaders are managing in the current environment, ABI asked CEOs of three ABI member companies to share their insights.

Navigating Challenges

“I hate not to say workforce. Anybody in Iowa and manufacturing will face workforce issues,” said Tyler Tamisiea, president of Spencer-based Tecton Industries, a privately-held, family-operated manufacturer of tight-tolerance and complex machined parts for defense and other industries. “Uncertainty in global markets, all the geopolitical issues” are an even bigger challenge, he said. “Markets are shifting so fast.”

Uncertainty is also the major concern for Michelle Jensen, president and CEO of employee-owned Rayser Holdings. The Cedar Rapids company operates three businesses: CarePro, a health care provider with a compounding pharmacy, home medical equipment and supplies and home infusion services; Midwest Memorials, offering monument sales and service; and J-TEC Associates, a manufacturer of flow meters for internal combustion engines.

“There’s always change in business, but in the last couple of months, we’re just kind of bouncing. The decision changes all the time,” Ms. Jensen said, referencing the Trump Administration. “Previously when a decision was made, whether you like it or not, it was a decision you could deal with. With the new administration, there’s a decision and you start down a path; then a different decision and you start going down another path. We’re in a state of languishing. You’re kind of hesitant on what decision to make.”

In an email, Dawn Ainger, chairman and CEO of Cedar Rapids-based Genova Technologies, responded to the question about the biggest challenge facing her business by talking instead about a challenge facing customers. “Genova is doing very well. Many of our customers are needing to make their equipment ‘smart’, which is Genova’s expertise. Also, many of our customers have lots of data, but are not sure what to do with it. They know the data is valuable, but how to turn that data into business intelligence is beyond their grasp.”

 Genova, which provides customized software solutions and services for clients in the avionics, defense, health, and commercial markets, “has the skills and experience to make equipment ‘smart’ and to turn data into business intelligence, so business is booming right now,” Ms. Ainger added.

Tecton and Rayser both focus on “controlling the controllables,” as Ms. Jensen puts it, to keep their teams and operations focused during turbulent times.

We’re just being purposeful in the decisions we can make about the things we can control. We’re a very transparent organization. We share all the financials and lots of information with our employee-owners. We hope that helps. Sometimes it’s maybe too much of a weight to put on them but we’re happy to sit down with them at any time and explain things,” she said.

“There’s so much noise. We focus on what we can control, tightening our internal processes, staying agile and building strength in our key areas.” Continued investment in technology and automation allows Tecton to “maximize flexibility,” said Mr. Tamisiea. Partnering with CIRAS at Iowa State University, Tecton has also implemented 5S lean practices and a procurement assessment in purchasing group to improve its operations.

Finding Paths To Growth

Tecton, Rayser and Genova each see opportunities for growth.

For diversified Rayser, it’s a mixed bag. Ms. Jensen is waiting to see how changes to Medicaid and Medicare in the “one, big, beautiful bill” recently passed by Congress and signed by President Trump, will affect CarePro’s business. For Midwest Memorials, tariffs on granite imported from India are a concern. Customers are also delaying orders for monuments due to economic uncertainty, she said.

On the positive side, Rayser’s J-TEC unit is a vendor for a component on the M1 Abrams tank. “As government spending increases, we will see an increase in that business,” Ms. Jensen said

Overall, Rayser’s business has held steady through the first half of the year. “Part of our goal is to grow through acquisitions. We’re not limiting ourselves,” said Ms. Jensen. Rayser is looking to add to its current businesses or diversify, focusing on companies in Iowa where owners are looking to sell and the ESOP option would be a good fit.

Mr. Tamisiea rates the overall business outlook as “stable,” adding that he’s “cautiously optimistic on the third and fourth quarters and going into 2026.”

“Defense and space and aerospace has been a growth area for us,” he said.

With more than 90% of its business coming from outside of Iowa, Tecton maintains a global focus. “Every day we’re having discussions with customers from all over world, places like Germany, Asia, Mexico. We are a very long-term planning organization.”

The outlook is also positive at Genova. “For the technology sector, it is looking good,” said Ms. Ainger. “The tariffs don’t affect Genova since we are a software company with our entire staff in the U.S.”

Opportunities In AI

AI will be “a disruptor for the next decade to the technology area, but for Genova, we see it as a disruptor in a positive sense,” Ms. Ainger said.

“Some of our customers have been asking, ‘Won’t software be created by AI in the future and you’ll be out of a job?’ The answer is ‘No, not if you use AI to make software and systems faster’. That’s what Genova is doing. Genova has been using AI to generate code automatically for years.”

She explains: “AI needs a model to generate useful code. Businesses need software engineering to create those models so that we can generate code for them. In addition, Genova is using AI to take databases of text, such as customer service reports and transcripts, and turn them into meaningful data.”

At Rayser, Ms. Jensen is seeing AI’s benefits. “It doesn’t impact all our companies the same. We are investing in platforms that can use it. It will help people do more, quicker. We haven’t found that it will replace positions that we have.”

The biggest effect, she said, is “probably within healthcare,” where AI can take dictation and translate the information into notes required for insurance. When CarePro receives information regarding a person’s health insurance that needs to go into its computer system, AI can pull it in directly with no need to manually to type it, saving time and reducing errors.

"AI is helping Tecton leverage advanced manufacturing technology,” said Mr. Tamisiea. “We see AI playing a very strategic role in our future. We’re using AI to help drive digital transformation in automation, workforce development and data integration.”

“It has a lot to do with data interpretation and integration,” he explained. “It’s taking data from the shop floor and integrating it into your environment. Ultimately, AI drives efficiency and precision across the rest of the operation.”

Workforce still an issue

Workforce may not be the top challenge this year, but it’s still top of mind for most, if not all business leaders. Tecton, Genova and Rayser are among the many Iowa businesses partnering with schools and colleges to develop a skilled workforce and opportunities for young Iowans.

“Genova has offered internships for decades,” said Ms. Ainger. “We really appreciate the State of Iowa’s program to help Iowa businesses keep Iowa students in Iowa after graduation.

Rayser’s internships and real-world work experience efforts are mainly created through Kirkwood Community College’s respiratory therapy program. CarePro unit’s home infusion service also utilizes pharmacists-in-training from the University of Iowa.

Tecton offers internships with engineering majors in the state. For example, an ISU student is filling an internship position on shop floor, Mr. Tamisiea said. Tecton also participates in a two-year apprenticeship program with Spencer High School.

“We absolutely find it valuable,” he said. “We’re doing it to develop a pipeline of skilled workers with real world experience. ABI