Press "Enter" to skip to content

Alleged Immigration Not Boosting South Dakota Workforce or Wages

I’m puzzling over the seeming disconnect between South Dakota’s alleged population growth and its stagnant economy.

Governor Kristi Noem has claimed that lots of (good white Christian) people are moving to South Dakota for (good white Christian) Freedom. Immigration expands the labor pool and eases inflationary pressure. The pandemic squeeze on inflation was one of the factors that made inflation worse:

When the economy started to open back up, he said there was a huge demand for workers in industries that typically rely on immigration, like service, hospitality and child care. But the pool of immigrant workers was suddenly a lot smaller.

The number of legal immigrants coming to the U.S. was cut in half between 2019 and 2020, according to Julia Gelatt with the Migration Policy Institute.

“The sharp drop in immigration was a big contributing factor to the tight labor markets we saw,” she said.

And that gap in the labor market led to wage growth, said Giovanni Peri at the University of California Davis. That, in turn, contributed to another of the pandemic’s big economic stories: inflation.

“But the recent rebound of immigrants started helping on that front,” Peri said [Savannah Maher, “Immigration Is Slowly Increasing After a Stark Pandemic Drop,” Marketplace, 2023.04.10].

If people are moving to South Dakota, we should see our labor force booming. But according to local financier think tank the Dakota Institute, South Dakota’s employment growth lagged well behind the national rate in 2022 (2.4% SD, 4.2% US), and the Dakota Institute is predicting South Dakota’s chronic labor shortage will continue through 2023. What gives—aren’t Noem’s new recruits seeking jobs along with their Freedom?

New residents ought to at least be buying more stuff and creating more opportunities for workers to make money. According to the Bureau of Labor Statistics, South Dakota just missed the top ten for growth in average weekly wages in Quarter 3 of 2022. But South Dakota’s average weekly wage remains the fifth-lowest in the nation—$1,052, 78.9% of the national average weekly wage of $1,334 and 78.2% of Minnesota’s $1,346. Only Oklahoma, Arkansas, West Virginia, and Mississippi are paying workers less.

Maybe that persistent low pay helps explain South Dakota’s GDP shrinkage throughout 2022: it’s tough to compete for a slice of national economic growth when you don’t pay workers competitive wages.

South Dakota’s dismal economic figures suggest a couple competing conclusions: either folks aren’t moving to South Dakota as much as Governor Noem claims, or the folks who are moving here somehow aren’t generating a lot of healthy economic activity that trickles down to growth for all of South Dakota.


  1. Nick Nemec 2023-04-12 06:26

    I wouldn’t listen to what she says, instead study actual numbers from the Census Bureau if you are interested in population growth and other demographic issues. The Federal Reserve is a better source for economic data than anything coming out of Pierre.

  2. scott 2023-04-12 06:38

    I’ve talked with 3 people who have gone to college job fairs, recruiting for their SD employer. 1 person side they have some freshman and a few sophomores stop by looking for internships, but no juniors or seniors. The other 2 people said it was absolutely depressing and literally a waste of their time, as very few students showed up to the event.

  3. sx123 2023-04-12 08:07

    Nothing has really changed in the last 30yrs.

  4. John 2023-04-12 08:47

    Noem and her legislative republicants are reaping the culture they sewed with their anti-family, anti-healthcare, anti-education agendas.
    Young folks with families or family aspirations will abandon this cultural backwater with haste. This is similarly occurring in Nebraska, Iowa, and North Dakota. Certainly for the short term those states retain a couple bubbles of viability: FSD metro, Bakken, OMA/Lincoln, Des Moines. But in the long run those bubbles may likely go the demographic ways of Huron and Aberdeen. Farms and neighboring small towns empty out, more regressive policies take hold, more young folks leave. Rinse. Repeat. More than half the US counties were smaller in 2020 than they were in 2010. Dirt doesn’t vote.

    Nick’s correct. Follow the numbers from the Census Bureau and Federal Reserve. Honest numbers do not come from Pierre or the state’s compliant universities.

  5. P. Aitch 2023-04-12 09:45

    While paying low taxes may seem appealing, it can also have negative consequences for the government and public services. States with very low taxes often have limited funds for public services such as education, healthcare, infrastructure, and emergency services. This can result in lower quality and accessibility of these important services, which can ultimately affect the quality of life of residents.

    Additionally, low taxes may cause the state government to rely heavily on revenue from other sources such as fees, fines, and fundraising. This can lead to an uneven distribution of costs and benefits, with those who can afford to pay more fees and fines having better access to services and amenities.

    Finally, low taxes may also discourage businesses from investing in the state, as they may be concerned about the availability of resources and support for their operations. This can ultimately result in a weaker economy and fewer job opportunities for residents.

  6. Richard Schriever 2023-04-12 12:42

    I believe, IIRC that Idaho, Vermont and Washington State are the three ACTUAL leading place people relocated to during the pandemic period. The real numbers I remember seeing said SD was somewhere in the bottom 3rd.

    Yeah, you just cannot believe anything at all that Mrs. Noem has to say about the “virtues” of the state. It all comes straight out of her barn.

  7. Mark Anderson 2023-04-12 12:49

    There’s always that all of west river National Park isn’t there? Oh, give me a home where the Buffalo roam and your skies won’t be cloudy all day.

  8. jakc 2023-04-12 16:02

    First, let’s deal with this: “While paying low taxes may seem appealing”

    SD is not a low-tax state for low-income workers. In most of the state, outside of SF I would guess, most workers make less than comparable jobs in places like Omaha, Des Moines and Fort Collins, and when the entire tax bite is considered, pay higher taxes for less services. At some point, high-wage jobs/high income from other sources probably do better in SD (thus Dakota Dunes)

    Second, I read recently that 2/3 of the immigration to RC is over 65. Makes sense. Make money elsewhere, reasonably cheap to retire there. But look at the growth in schools. Fifty years ago, 2 of the four biggest schools in the state were in RC and two in SF. Now, four of the six biggest schools are in SF and six of the eight biggest schools are in the SF area (I imagine Tea will join in a few years. It would already be close if it hadn’t split with Lennox). RC has grown by 30,000 and Pennington has grown by 50,000 and you only see modest growth in the two schools outside RC (Sturgis and Douglas, the Sturgis school district extending to near the RC line). People are moving to SF as an alternative to other midwest areas; people are retiring to RC.

    John is right about the long decline of rural counties in SD and elsewhere and the willful decision by Republicans to ignore that decline. Why should they do anything about it? Once competitive counties are no longer competitive and give huge margins to R’s. Until the SF metro is big enough to vote its own way, and breaks with the R’s, what reward is there for Kristi Noem to fix the problems in rural SD? Rural R’s seem to demand nothing for their votes but some cultural war nonsense and ever-expanding gun rights

Leave a Reply

Your email address will not be published.