Every press release from the South Dakota Department of Agriculture notes that agriculture is “a major contributor to South Dakota’s economy” and generates $25.6 billion in annual economic activity. I’ve always said that $25.6 billion figure is bogus since South Dakota’s total GDP is in the $40-billion range, and there’s no way ag generates over half of our economy.
The Bureau of Economic Analysis offers the actual GDP figures by sector in this chart, which shows that, yes, ag is a major contributor to our economy, but farming and ranching have slipped from the third-largest component of South Dakota’s economy in 1997 to the eighth-largest in 2017:
South Dakota’s biggest private industry sectors are finance and insurance, real estate and rental and leasing, manufacturing, and health care and social assistance. Include the public sector, and government is the second-biggest contributor to GDP in our supposedly low-tax, low-government state. There’s even more wealth being generated in wholesale and retail trade than in agriculture.
Or look at the percentage gains: Ag GDP over 20 years increased 86%; the total state GDP grew 160%. GDP in finance grew 532%.
None of this says agriculture isn’t important to South Dakota. But it does say that other economic sectors have become even more important.