Iowa's employment landscape experienced a significant shift in February 2026, as the state saw a record decrease in its unemployment rate. According to the latest data released by the Iowa Workforce Development agency, the unemployment rate in Iowa dropped to 2.1% in February, down from 2.5% in January. This marks the lowest unemployment rate the state has seen in over a decade.The decrease in unemployment can be attributed to a combination of factors, including a growing economy, increased job opportunities, and a strong labor market. Several industries in Iowa have been experiencing growth, particularly in manufacturing, healthcare, and technology sectors. This has led to an increase in hiring and job creation across the state.In addition to the decrease in unemployment, Iowa has also seen an increase in labor force participation. The labor force participation rate in the state rose to 68.3% in February, up from 67.8% in January. This indicates that more individuals are actively seeking employment and entering the workforce.Governor Kim Reynolds expressed optimism about the state's economic outlook, stating that the decrease in unemployment and increase in labor force participation are positive signs of Iowa's strong and resilient economy. She highlighted the state's efforts to attract new businesses, create job opportunities, and support workforce development initiatives as key factors contributing to the drop in unemployment.Despite the positive trends in Iowa's labor and employment landscape, challenges still remain. Some industries, such as hospitality and leisure, continue to struggle with labor shortages and hiring difficulties. Additionally, wage growth has been modest, prompting calls for increased efforts to address income inequality and ensure that all workers have access to fair wages and benefits.Overall, the record decrease in Iowa's unemployment rate in February 2026 signals a promising future for the state's economy. With continued investment in workforce development and job creation initiatives, Iowa is well-positioned to maintain its strong labor market and support sustainable economic growth.