Press "Enter" to skip to content

Healthy Housing Demand Drives Up Rent; Can Worker Demand Drive Up South Dakota Wages?

Governor Kristi Noem would really like to blame President Joe Biden for higher housing costs, and I’d really like to blame Governor Noem, but really, we can only blame ourselves: more people want more places to live, and we aren’t building new places to live fast enough:

A sharp increase in demand and a short supply of available units are making rental housing a hotter and more costly commodity than in previous years in South Dakota. Part of this demand comes from households “separating” in the post-pandemic world of 2022.

Census data shows that the number of households in the U.S. increased by nearly 1.48 million in 2021 after a decrease of an estimated 130,000 households in 2020. Young adults moving out of family homes and those looking to live without roommates have contributed to this, making the 2020 to 2021 jump the highest in almost ten years [Kylie Carlson, “Skyrocketing Housing Costs Adding to Financial Burdens of Renters in South Dakota,” South Dakota News Watch, 2022.05.26].

Young adults moving out of Mom and Dad’s basement and getting places of their own—that’s a good thing, right? We could ease rent inflation by telling all those young people not to be independent, not to sink their money into the American Dream of homeownership, but that would be like telling people to use less gasoline, buy fewer clothes, or put off upgrading their appliances. Stifle reasonable consumer desires, and you sink the economy, not to mention leave Mom and Dad having to share the washer and dryer again.

Of course, there’s an unhealthy economic impulse making South Dakota’s rising rents more problematic—the impulse to exploit labor and pay less than living wages:

In 2021, the National Low Income Housing Coalition reported that the average renter’s wage in South Dakota was $13.15 per hour, or about $27,400 annually. At that wage, monthly rent must be at or below $684 to be considered affordable, or under 30% of a renter’s monthly income. Making that wage in 2022 would limit housing options to studio and one-bedroom options in some parts of the state [Carlson, 2022.05.26].

South Dakota’s minimum wage is $9.95 an hour. That still won’t rent much of an apartment, but it’s better than the $7.25 an hour that people in Noem’s party would have left it at, and it will increase significantly next January thanks to the inflation adjustment that people in Biden’s party (with vital help from a lot of you voters—thank you!) built into South Dakota’s minimum wage in 2014.

But something in the market isn’t working when even the average renter’s wage, significantly above the government-mandated floor, isn’t covering adequate housing for a worker and the worker’s family. The demand for workers in labor-poor South Dakota is at least as intense as the demand for housing, yet rents seem to be going up faster than paychecks. How is it that South Dakota landlords can demand higher pay for their services but South Dakota workers cannot?

The next time you hear Kristi Noem or anyone else complaining about inflation, ask what the complainer would like to do about rent inflation specifically. Does the complainer want to build some socialist housing projects to meet demand? Should we tell young people to live with Mom and Dad longer? Should we stop inviting people to move to South Dakota? Should we cap AirBnB to leave more small affordable houses on the residential market? Or should we stop recruiting cheapskate businesses, repeal our union-busting laws, and raise wages to make South Dakota more friendly to workers who’d like to rent apartments and buy homes?


  1. Mark Anderson 2022-05-30 09:05

    Kristi Noem likes to lie about saving her farm and it is a farm, not a ranch, from estate taxes. Estate taxes were proudest accomplishment of Jefferson, whom she “guards” on Mt. Rushmore. He was proud of it in Virginia and saw it was a way to prevent aristocracy in America. He probably thought of it postcoitally with Sally and later wrote about it to Adams. His ideas kept popping up, just like Lewandowski keeps popping up in Noems life.

    The French just lopped off the heads of the aristocracy, but she’s talked about that to her adoring NRA crowd. Republicans always need ways to differentiate themselves from those beneath them and keeping millions poor is the best way to do it. While of course keeping them riled up, they can use that anger. It provides cheap labor to those trust fund aristocracy wannabes and how else can you keep those breakfast costs down, right Grudz? No to unions, labor unions that is. High rent, low wages, high college costs, just keep those slaves working against the Democratic elites and make America great again.

  2. leslie 2022-05-30 09:45

    “But something in the market isn’t working….” And that’s not all!

    CBS president Les Moonves’ famous boast, at a Morgan Stanley conference in 2016, that Donald Trump’s presidential campaign “may not be good for America, but it’s damn good for CBS” highlights the dire necessity of reversing the Supreme Court’s notorious Citizens United ruling, which extended First Amendment protections to corporate “speech,” both in the form of direct campaign contributions and untraceable, unlimited “dark money” spending.

    “That kind of jurisprudence hands the megaphone, along with almost incalculable political power, to incorporeal entities [corporations], and leaves ordinary citizens who struggle to advance the public interest feeling powerless and straining to be heard. It doesn’t strengthen speech but hollows it out, incentivizing selfishness and leaving us with empty platitudes. Pumping corporate speech into politics leaves a vacuum in public beliefs and virtues that clueless armed citizens have too often tried to fill by besieging state capitols — and storming the U.S. Capitol.”

    Yes, corporations. The ultra powerful fictional entities we occasionally recognize here as actors playing the gross economic inequality which robs our world.

  3. buckobear 2022-05-30 09:48

    Where are the workers for the new battery plant and slaughterhouse in Rapid City going to live ??
    … and I’m sure most of those meat packing employees will be “furriners.”

  4. Cory Allen Heidelberger Post author | 2022-05-30 10:03

    New battery plant and slaughterhouse in Rapid? When will those be open? How many new jobs are they bringing? And what wages are they offering?

  5. Tim 2022-05-30 12:52

    “the pretense that another tax break will trickle down to renters and homebuyers” there is only one thing that trickles down to us regular people, it isn’t money.

  6. Joe 2022-05-30 17:01

    Battery plant (1,200-1,500 jobs): A high-tech battery company plans to create a four-building campus and eventually hire more than 1,200 people in Rapid City.

    Æsir Technologies creates nickel-zinc batteries that serve data centers and 5G networks, according to a news release from Elevate Rapid City. The batteries provide backup power to prevent data loss or service interruption during power outages.

    “Not only is it high tech but it’s a new technology that’s cheaper to build, has a higher capacity, is environmentally safe to both manufacture and recycle. It’s kind of a win-win-win,” said Matt Brunner, economic development director of Elevate Rapid City.

    Æsir, headquartered in Joplin, Missouri, says the Rapid City factory will produce nearly two-billion-watt hours of batteries per year.

  7. Joe 2022-05-30 17:05

    Beef/bison processing plant:

    RAPID CITY, S.D. (KEVN) – It was announced Friday that a $1.1-billion high-tech meat processing plant will be built in western South Dakota.

    Kingsbury & Associates, along with Sirius Realty plan on constructing an 8 thousand head per day packing plant off Highway 79 just south of Rapid City. It will process beef, and will have a bison line as well.

  8. Bonnie B Fairbank 2022-05-30 17:56

    Ah, the perfect sh*tstorm of of outdated wants, desires, and consumerism. My graduating middle and lower class cohorts of 1974 were “18 and outta the door” teenagers. We knew and anticipated it and some had been working since they were twelve. Parents got their minor’s salary, f*ck child labor laws
    The economy was different then. Unless you were the first born male expected to inherit his parent’s dairy farm, you’d best clear out or your family was strange.
    Our parents were brainwashed with “pull yourself up by the bootstraps, rugged individualism, and rags to riches” propaganda. Salaries, housing, and economics were never or are that simple.
    There are many more Americans than in 1974, and I’ve no suggestions how to house us all in our current ideas of comfort. I’ll just say that in 2002/2003 my late husband and I housed four or five in-laws in our two BR, 1 BA house, and we slept in our unfinished basement so we could have privacy and I could stoke the solid fuel (peat, coal, wood) stove to heat our house.

  9. grudznick 2022-05-30 19:33

    Good on you, Ms. Fairbank. You have weathered well.

  10. P. Aitch 2022-05-30 19:44

    Given that three fourths or so of the underpaid schmucks in SD vote solidly Republican, why should American liberals give a darn? Why should the handful of SD liberals care, either? Until those lower income workers learn to vote in their own best interest why should any American progressive do a single thing to help SD mature? The wrong side of history is well defined and it’s apparent where SD sits. Rationally thinking SD people know how to improve their lives quickly and it’s not staying put and suffering through SD’s imbalance of political growth.

  11. Anne Beal 2022-05-31 00:10

    Besides investment in airbnbs driving up the cost of homes there is the issue of households “separating” due to the pandemic. People who were content to cohabit when they had jobs to go to decided they couldn’t stand each other when they were both working from home. It seems quite reasonable that this caused an increased need for more housing units. At the same time construction costs have risen dramatically, driving up the cost of new homes. Lumber has become especially expensive.

    How you can blame the governor or anybody else in politics for pandemic-induced domestic discord is an interesting question.
    If you don’t get along with your parents, spouse, or roommate, that’s your problem. Maybe you can go on the Dr Phil show to work it out. It’s not the government’s fault. You sound like my sister, who sits on the board of a homeowners’ association and believes it’s Trump’s fault she doesn’t get along with her neighbors. Really. She told me that. It’s Trump’s fault for being divisive. Then she resumed complaining that the people next door don’t put their trash cans away as soon as she thinks they should.

    The supply-chain problems affecting the cost constructing new housing units can be addressed by government agencies but probably not at the state level.

    Increasing the minimum wage will just make it possible for housing costs to rise even more, as people with have more money to pay rent so landlords will charge more. The landlords will charge whatever the market will bear, so raising the minimum wage won’t help at all.

    And if you are thinking of moving, stay away from any place that has a homeowners’ association. You don’t want to live there.

  12. All Mammal 2022-05-31 01:33

    It doesn’t do a community any good that those soulless corporations are sucking up rental properties at a gluttonous rate. Corporate landlords only have one goal: feed their board of investors. They do not care about living conditions, safety, repairs, property values for neighbors, common decency. They care about more, more, more. They will not invest in their properties or make improvements. Just collect checks. They know the government pays their bills on time. If a corporation cannot be held responsible for crimes it commits as in no body to cuff and haul downtown, and there’s nobody to summon for jury duty, then they are not people and the 14th amendment should not consider corporations as such.

  13. P. Aitch 2022-05-31 13:50

    Really Anne? Think this through and be sure you want to be known for this self-serving and elitist statement.

    “Increasing the minimum wage will just make it possible for housing costs to rise even more, as people with (sic) have more money to pay rent so landlords will charge more. The landlords will charge whatever the market will bear, so raising the minimum wage won’t help at all.” – Anne Beal

    Anyone else on this blog see what she’s trying to do here?

    In response: Raising the minimum wage will get people that much closer to home ownership which will in turn decrease the number of people under the thumb of “rent gouging’ landlords.

  14. Mark Anderson 2022-05-31 17:58

    Anne it’s so nice to see a person who believes any attempt to help someone is misguided. You Republicans really need the poor don’t you?

  15. ABC 2022-06-01 00:20

    Here is Arnold Scwarzenegger’s 6 rules of success (from his YouTube videos)

    1. Have a vision. Know where you’re going.
    2. Don’t listen to nay sayers. Yes, it can be done.
    3. Work your ass off.
    4. Work like hell and advertise. (Let people know what you’re doing.)
    5. Don’t be afraid of failure . (Never have a Plan B)
    6. Help others. (Benefit others).

    There it is!

    Want to succeed like Arnold, he just told you how he did it.

    The opposite ?

    Don’t have a vision or goal. Listen to the Nay sayers. Don’t work your ass off. Don’t work like hell, don’t tell anyone, don’t advertise. Be afraid of failure. Always have a plan B. Don’t help others.

    Be like Arnold!

  16. Cory Allen Heidelberger Post author | 2022-06-01 07:56

    I agree with Anne’s aversion to homeowners’ associations. Let the city council be in charge of the city. I also agree that AirBnB raises housing costs by taking affordable housing out of the residential market and decreasing supply and pitting middle-income workers looking to buy houses in bidding wars against investors with cash on hand to buy houses and turn them into revenue generators.

    Anne, do you have evidence that working from home has caused domestic discord and domestic separation? If you can provide such evidence, I hope your proposed solution does not involve forcing everyone back to the office. If people can’t stand to work in a home environment with people they love, how do you expect those same misanthropes to work effectively surrounded by mere business acquaintances?

    Anne, doesn’t your argument about the minimum wage lock us in to never raising anybody’s wages? I mean, isn’t it just as inflationary to raise CEOs’ wages? By your argument, to avoid inflation, shouldn’t we cap everyone’s wages at $9.95 an hour, to minimize the amount of money flowing the economy and prevent landlords from raising rent?

    Less neighborly behavior is partly Trump’s fault. Trump has normalized unneighborly behavior.

Leave a Reply

Your email address will not be published.