When aerospace and defense companies scout sites for their next facility, the usual names tend to come up: Wichita, Fort Worth, and Seattle. But as these companies face mounting pressure to shorten supply chains, secure skilled workers, and break ground faster, many are widening their search. At the top of that list: Iowa.
The state exports nearly $1 billion in aviation parts and electronics to more than 125 countries, and has built a network of manufacturers, suppliers, engineering talent, and aviation businesses that support a thriving aerospace ecosystem. Iowa also ranks third in the nation for concentration of mechanical engineers, third for manufacturing workers, and second for the share of its workforce employed in STEM occupations.
Those aren't the stats of an emerging player. They tell a story of a state that has spent decades building many of the advantages aerospace companies are searching for today.
That foundation spans beyond workforce and manufacturing strength. Iowa has also worked to create a business environment designed to help companies move quickly, with a focus on regulatory efficiency, responsive state leadership, and policies that support long-term growth.
Here's a closer look at the three reasons aerospace and defense companies are giving Iowa a second look:
1. A workforce built to last
Ask aerospace executives what keeps them up at night, and workforce challenges top the list. Programs can miss milestones when experienced machinists retire faster than apprentices replace them, or when specialized welders take opportunities elsewhere.
Iowa's advantage is institutional. A network of apprenticeships, community colleges, and research universities helps sustain a manufacturing workforce known for its stability, longevity, and technical expertise.
That talent pipeline supports an aerospace and defense industry that employs 19,286 people at an average wage of $109,596, according to 2023 data from the Aerospace Industries Association.
2. The cost case
Beyond talent, Iowa makes a compelling cost case.
It starts with a corporate tax rate that will ultimately be reduced to a target of 5.5% — among the most competitive in the nation — and the savings build from there. Industrial construction costs run roughly 18% below the national average, while corporate rental rates are approximately 15% lower, so a company spends less to build and less to stay. Because corporate income tax applies only to sales earned within Iowa, companies that manufacture in the state and sell elsewhere retain more of their earnings. Businesses can also benefit from a sales and use tax exemption on digital goods and services purchased for commercial use, among the broadest in the country.
The state also offers incentives designed to support growth. Iowa's Research and Development Tax Credit Program encourages innovation in advanced manufacturing, while programs like the Industrial New Jobs Training (260E) Program can offset workforce training costs associated with large-scale hiring and expansion.
Operating costs remain competitive long after construction is complete. Beyond Iowa's energy costs being 28% lower than the national average, the state generates more electricity from renewable sources than any other, and ranks among the nation's leaders for grid reliability. Its central location provides another advantage, with access to road, rail, air, and river transportation networks that help keep shipping costs and supply lines short.
3. Breaking ground without the wait
A site isn't valuable if it takes years to become operational.
Iowa ranks among the top 10 states in the nation for site readiness, and its Certified Sites program helps take the guesswork out of site selection by identifying development-ready locations that align with a company's project timeline. For businesses operating on tight schedules, a certified site is a tailwind: The environmental reviews, utility assessments, and zoning are already complete, so the company can scale up quickly and potentially save thousands on site preparation costs.
One example is the CID SuperPark, located near the Eastern Iowa Airport in Cedar Rapids. The SuperPark spans 582 development-ready acres, while the broader airport campus offers roughly 1,300 additional acres available for lease. It also benefits from its Foreign Trade Zone designation, close proximity to Interstate 380, and convenient access to rail and air transportation.
The location reflects Cedar Rapids' longstanding aerospace legacy. Its address — 2515 Arthur Collins Parkway — honors the radio pioneer who founded Collins Radio Co. in 1933. That company now lives on as Collins Aerospace, the city's largest employer, with roughly 7,000 employees nearly a century later.
A serious contender for what's next in aerospace
Iowa's talent pipeline, financial incentives, and ready-to-build sites didn't appear overnight. They're a result of a state that has spent decades investing in manufacturing, workforce development, and long-term economic growth.
The legacy aerospace hubs aren't going anywhere. But for aerospace and defense companies looking for their next phase of growth, Iowa offers a rare combination of capability, speed, and room to grow, all in one place — making it a serious contender for the next generation of aerospace investment.
Learn more about what Iowa has to offer.
Get a closer look at the present and future of Iowa's aerospace and defense industry during the 2026 Farnborough International Airshow (July 20-24) at booth #2428.
This sponsored post was created by BI Studios with Iowa Economic Development Authority.
