With good political reason, Governor Daugaard has been touting what he considers to be the successes of his administration for the past umpteen months. It's a shame that the limp-wristed candidacy of Democrat Susan Wismer couldn't have made a more forceful counter argument during the just-ended campaign, because some facts about the state and direction of South Dakota belie Daugaard's self-congratulatory rhetoric. While his vaunted claims of economic growth are probably statistically supported, it seems obvious to me that the growth has been concentrated in the relatively compartmentalized ag sector, given that grain and livestock prices have had several very good years.
Nothing wrong with the fact that a lot of great South Dakotans are doing very well these days. It's a wonderful turn of economic events for some of the hardest working and most decent people I've ever known, especially considering how hard they toiled for literally decades before this excellent market for $2+ calves and "beans in the teens" came to fruition. More power to 'em, and I really mean that.
The problem is that the spillover effects into South Dakota's general economy seem to be marginal at best, nonexistent at worst. In yesterday's post I supplied some data from the U.S. Bureau of Labor Statistics that showed the job growth rate for the past couple of years in South Dakota has been about half the national rate (a fraction of a percent for us, nearly 2 percent for the U.S. as a whole). This is anemic from the get-go, but it looks even more pallid when considering that South Dakota, in Daugaard's view, has been having strong economic growth during his term.
Now comes news that's even more disconcerting, considering that captain Daugaard's ship is supposedly plying the economic waves at full speed ahead. The poverty rate in South Dakota last year increased by about a half-a-percent, while here in the Black Hills it jumped by an astounding 3.3%, or nearly 6,000 people who will add significantly to the strain on local welfare agencies. The Black Hills Knowledge Network's graph in the link (sourced out to the U.S. Census Bureau) shows another fact that should be of some concern to those who want to pat themselves on the back over South Dakota's "economic boom": While our poverty rate has been going up per the latest data, the overall rate in the United States has been going down.
As if sub-par job growth and a negative contra-trend in poverty rates aren't challenging enough to the rosy image presented to us by Daugaard, here's the one that should be, if anything, more troubling. If you check out page 12 of this comprehensive report on South Dakota's labor imbalances completed this year by Philadelphia's Drexel University, you'll see a U.S. Census Bureau table that shows a rather unsettling trend from 2008-2012: South Dakota is a net importer of folks with high school diplomas or less, a net exporter of those with Associate degrees or higher. And the differences aren't just marginal, reaching into the 5%-6% range in both cases. Considering that the report shows that almost 40% of South Dakota's population growth comes from in-migration, a continuation of this trend will result in a workforce that is heavily overweighted with a population that has little-to-marginal educational attainment. Not a good thing in a state that is chronically short of skilled and well-educated workers.
I appreciate that Daugaard made a pro-forma attempt at addressing these issues with a "Workforce Summit" program. I doubt that it will yield significant results because its conclusion didn't bother to mention low wages as being part of the problem. Daugaard's campaign-colored, facile display of data that indicates South Dakota has been advancing briskly on the economic front notwithstanding, it seems obvious that those "gains" haven't done much to improve life on the streets. I look forward to the Governor addressing these issues, up front and post haste as his second term gets underway.