The widely followed personal finance website WalletHub last month came up with a comprehensive look at all fifty state trendy. Using 28 indicators of growth developed by a field of experts representing four universities (NYU, Oklahoma, George Mason, Ashland), the firm came up with a ranking that should give South Dakotans some pause. Although our state ranked high in economic health (#4), we lagged badly when it came to economic activity (#42) and innovation potential (#47).
That we’re “healthy” is of course an excellent snapshot on how things are going right now, but forward looking indicators like economic activity and, most notably, innovation potential are dismayingly low.
Our GDP growth in 2021, which is the biggest metric that WalletHub uses for measuring economic activity was well below national economic growth, going up by 7.25% over the previous year, which compares to overall US economic year-to-year growth of 10.1%. That significant underperformance probably has much to do with our low ranking in the economic activity category.
Most disturbing in WalletHub’s assessment is the poor showing in the innovation potential column. This one looks at share of jobs in high tech and STEM (Science, Technology, Engineering and Mathematics) industries, along with a number of patents, research and development investment, and entrepreneurial activity. Being 47th in the country when it comes to those measures is bad news.
We can boast all we want to about South Dakota’s allure for outside businesses and individuals, but the numbers are telling us that we just aren’t keeping up with the rest of the country when it comes to overall economic growth, nor about our ability to hold our own when it comes to the innovative nature of our economy.
Looking at how we did regionally in WalletHub’s survey, only Wyoming (placing 45th) and North Dakota (at 38th) are worse off than we are. Montana, ranking 18th, and Minnesota at 19th, beat us by a mile. Iowa and Nebraska, coming in at 24 and 29, respectively, also did quite a bit better than South Dakota.
Why do we lag, both regionally and nationally? I think our political culture has something to do with it. Consider, for example, that South Dakota can’t wait to apply the recent Supreme Court ruling that overturned Roe v. Wade. The reaction in the private sector? Many companies have announced that they’ll pay abortion-related travel costs for their employees that live in states like South Dakota. The list of those companies is pretty much a cross section of America’s private sectorincluding names like Amazon, Bank of America, Dick’s Sporting Goods, Proctor and Gamble, Target, Tesla, and so many others.
If you scroll through the list on my link, you’ll see that innovation is the driving force for many of these firms, and as innovation is at the heart and soul of economic growth, South Dakotans need to consider why we’re ranked so poorly in that area. That ranking was established before the Supreme Court’s ruling, which now can only further the trend. How many elements of the private sector see much of a future for themselves in a state that is determined to keep their female employees away from services that are readily provided elsewhere?
I wonder if Noem and her anti-choice followers who are whooping it up over the Supreme Court’s rejection of Roe v. Wade will ever understand that the majority of Americans are pro-choice. South Dakota’s official commitment to denying choice to half the population has the potential for reducing, not enhancing, the prospects of a state that is already showing less than mediacre results in economic performance.
John Tsitrian is a businessman and writer from the Black Hills. He was a weekly columnist for the Rapid City Journal for twenty years. His articles and commentary have also appeared in The Los Angeles Times, The Denver Post and The Omaha World-Herald. Tsitrian served in the Marines for three years (1966-69), including a 13-month tour of duty as a radioman in Vietnam.