Monday, September 1, 2014

Labor Day, 2014. Seems To Be Plenty Of "Day" In South Dakota--But Where's The "Labor?"

     The apologists for lousy wages in South Dakota will just not stop with the excuses.  The latest one I saw came in the Labor Day edition of the Rapid City Journal this morning.  In its piece  headlined "Many jobs, few workers, low pay," the RCJ story (by-lined by Seth Tupper) went to Benjamin Snow, President of the Rapid City Economic Development Partnership for some thoughts on the Rapid City's chronic labor shortage.  After noting that South Dakota, according to Bureau of Labor statistics published last year, had the nation's 2nd-lowest average hourly wage, RCJ got this paraphrased reaction from Mr. Snow:  "Wage debates sometimes ignore  the positive impact of South Dakota's low cost of living . . . Earlier this month the non-partisan Tax Foundation in Washington, D.C. published an analysis of the relative value of $100 in each state.  The relative value in South Dakota is $113.38, which is fifth highest in the nation."  The contrast presented in the RCJ piece was with Washington, D.C., where a hundred smackers had the lowest relative value in the country at $84.60.
     This is an amazing failure of contextual analysis, actually, as I believe a much more meaningful comparison would be with the contiguous states in our region.  I think it stands to reason that looking at our adjacent competitors for the already short supply of labor gives a more useful picture, and the comparisons there are much less stark.  The average relative value of a hundred bucks in SD and its 6 contiguous neighbors is about $108, so SD's $113 doesn't look quite so attractive on that scale.  That Mr. Snow continues to perpetuate the "South Dakota has a low cost of living" myth makes me wonder if he and the development group he heads are using the kind of hard-headed businessperson's look at reality that running a successful profit-oriented operation demands.  Certainly the fact that Rapid City continues to come up short in the labor pool sweepstakes suggests that Snow's organization could use some re-orientation on its views about how the city, specifically, and the state, generally, stack up in the COL rankings, if indeed that's what they keep using as a come-on for developers and investors.  Continually pushing the line that SD is a low-cost state is flat out wrong.   If you don't have time to look at the link I'll condense it:  A U.S. Census Bureau vendor called The Council For Community And Economic Research (thanks, Cory Heidelberger at The Madville Times, for saving me the time of looking this up) places South Dakota at smack-dab-in-the-middle, number 25, of the country when it comes to cost of living.  It's time for all of us to get over the notion that life in South Dakota is some sort of economic bargain.
     And as long as low-wage apologists want to bring up rankings, here's one from the playbook that we Republicans like to consult on all matters economic--Forbes. The mag recently ranked the states on best and worst places to make a living, using data from Moneyrates.com.  All six of our contiguous competitors outranked South Dakota.  All six.  Minnesota, Nebraska and North Dakota are waaay out in front, each of them in the top ten.  So you want rankings?  I have rankings.
     On a hopeful note, I see that SD Governor Dennis Daugaard is about to unveil the results of his series of "Workforce Summits" that took place throughout the state earlier this year.  The summits were a result of Daugaard's commitment last January during the legislative session to make workforce development a top priority this year.  My hope is that the conclusions are more broadly-based than mere economic considerations--and that issues like educational opportunities, healthcare, cultural development, recreational assets and other lifestyle-oriented matters are addressed and attended to.  South Dakotans, like all people, don't live by bread alone.  And a skilled, well-educated workforce demands more than steady paychecks to make lifetime commitments to this state.

   
            

3 comments:

  1. Good piece, John! 100% agreement. I think a good first step is to recognize that we cannot build a high-wage economy with a workforce trained to solder motherboards.

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  2. I agree with you. As an employer of one I hire him at the lowest wage I can. I feel bad that I don't pay more, but it would just be more FICA and Medicare that I would have to pay, so i offer perks like gas, fuel and other things.

    We stopped last week in Rapid City and saw the lines at 5 guys and blaze pizza. Looks like more workers than customers at times. Are these workers subject to minimum wage rules? How much would they be paid? There seems to be demand for food service workers, but we can't find anyone to work 70 miles from Rapid City on an ag job for any wage. i would pay more if there was someone interested in working. I have had offers from unskilled workers ,but they want $20 an hour and need training. What ever happened to starting at the bottom and working up?

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  3. John, It is nice to see a businessman who gets it. The folks at the top can only spend so much. Every dime that you put into the pockets or hands of a working person will come back into the economy and make business better. When the Dems circulated the petition to raise the minimum wage in SD to 8.25 as a ballot issue, I told them I would sign it, but that they were way off the mark. The minimum wage needs to go to 10 bucks an hour at least.

    I may have posted this here before, but I will do so again, when figuring my two small pensions and my social security, my wages figure out to 12.20 an hour based on a 2080 hour work year. I would hate to even try to make it on 10 bucks an hour.

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