It seems the ‘all knowing’ Randell Beck at the Gargoyle Leader and Slater Barr, President of the Sioux Falls Development Foundation figured out something most of us working class stiffs in Sioux Falls have known for years; attracting businesses to Sioux Falls based on the ‘cheap labor’ mantra doesn’t build a strong local economy. The more you pay workers, and the more skilled labor you have, the more they can invest in the community. Keep paying shit wages to the average Joe, and he will continue to shop at Walmart and live in trailer parks.
One person interviewed for the study put it a bit more bluntly: “Growth has been driven by emptying out of South Dakota’s small towns. What’s next? Where are our future workers going to come from when that trend slows?”
I call it the Sioux Falls ‘vacuum’. Instead of trying to attract ‘skilled labor’ businesses we attract ‘cheap labor’ businesses and those who want to get out of the small towns see Sioux Falls as a beacon. Until of course they get here and realize they are working twice as much just to get by.
“It used to be that economic development was shoot anything that flies and capture anything that falls,” Barr told Argus Leader reporter Anna Bahney, explaining the way most cities, including Sioux Falls, once tried to attract prospective employers. “But now we’re asking, ‘Does it boost wages? Does it raise the bar? Does it create, attract or retain wealth for the community?’ “
No. Fuck NO! And why would you think it would? It amazes me (and trust me, I do have great respect for Beck and Barr) that these two guys with all of their experience and knowledge cannot grasp simple economics, and that they have to come to some king of ‘realization’. Pay people shitty wages and you will get a shitty return on your investment.
Compared to most regional cities, Sioux Falls ranks near the bottom in metrics such as advanced degrees and, of course, income. While we are rightly proud of our small-business heritage, we have a limited capacity for innovation and entrepreneurship.
Gee, I wonder if there is a freaking correlation between the two? Dead end jobs, that employee dead end people, pay dead end wages. I also find this column to extremely hypocritical. Do you know what the Gargoyle Leader pays their staff? It is embarrassing.
Why not set an example Randell instead of just pissing and moaning in your weekly rant. Of course, that might cut into your bonuses and wages . . . huh . . . and we wouldn’t want that, would we?
It’s kind of a funny trend. People move here from small towns nearby, start a career, have kids, then the kids leave after they graduate and can’t come back because they can’t find a job that will allow them to live decently and pay off their student loans.
When young people see these two options: get a job in a major metro area that pays enough to pay their debts and have a life, or get a job in SF where they will be working their asses off just to claw their way up to a $30k salary in ten years, it’s no wonder they don’t come back here. Simply being the best option in South Dakota isn’t good enough.
I wonder if our business development people even know how to attract companies that pay well.
Nice rant, but again you compare Sioux Falls stats to just about anywhere and our Economic health is at or near the top. Other places that have tried to legislate prosperity are the ones that are at or near the bottom and on the verge of needing a bailout. Sure, Beck could hand out $10K raises to everyone tomorrow, but in the current environment you’d see the place shutting down within a year. What good’s a $50K a year job if it bankrupts the company?
I agree with Beck & Barr though, we need to figure out how to attract higher salary positions, and most of those people will look at how our “Quality of Life” items compare to larger metros. We also need to keep investing in higher education opportunites, keep our tax burden & regulatory environment low.
I just about puke whenever I hear one those ads put out by the SF Chamber saying how great is it to start a career here. The low wage issue is what has been driving the so called econ. development in this state for the past 30 years. It is ironic that Mr. Beck write an editorial on this subject when there are always job openings at the Misleader.
There are businesses located and still locating near Sioux Falls. Wind energy picked Brandon, Hyperion picked south, gaming picked NE. Iowa, distribution picks Tea/Lennox, agribusiness picks south, and services picks north.
Sioux Falls is dying from corrupt city government and high taxes. There’s been property tax increases every year for 10 years. It’s much cheaper to live in nearby towns and there’s liberty from Home Rule government rights abuse.
City government is unconstitutional and separated from state policy. Without change, there’s no hope and citizens will continue moving out from the city limits or out of state.
Other places that have tried to legislate prosperity are the ones that are at or near the bottom and on the verge of needing a bailout.
Nobody’s trying to legislate it here. Just trying to attract something better. Just one big corporate HQ would raise wages for all educated workers in the city.
There are businesses located and still locating near Sioux Falls. Wind energy picked Brandon, Hyperion picked south, gaming picked NE. Iowa, distribution picks Tea/Lennox, agribusiness picks south, and services picks north.
There are good reasons for all of those businesses’ locations and none of them have to do with our home rule charter.
And it isn’t that much cheaper o live in the burbs. I have friends who live in Brandon, and while their home costs them a couple hundred bucks less every month than a similar one in SF, they spend about $450 a month on gas commuting to work and social events. I tell people all the time that there is no good reason to live anywhere in the SF metro except in SF. the schools are better, things are closer to you, and there is a lot more to do within walking distance.
Maybe not…but who exactly are all those demanding a “living wage” or “higher wages” looking to to bring it to fruition? Look at the disdain lobbied at a private company like Gannett for not going against the Laws of Economics. Fodder for more “Hope & Change” if I ever smelled it.
PG’s correct, though. All of those businesses/industries are indeed locating here. They are doing so because all other things being relatively equal, it IS cheaper to do business here over the long term. Hate the Chamber if you want; but thy’re the ones actively promoting the cost benefits of locating a corporate HQ here. I forget the actual numbers but for a 200 person HQ it’s like $4 million cheaper than the coasts and $2 million cheaper than places like MLPS or ST. Louis. That advantage goes away and you will have some tough sledding to replace it.
Question – what corporate HQ of any size has relocated to SF in the last 10 years?
HH – Yeah, I would like to see the list also.
“Sure, Beck could hand out $10K raises to everyone tomorrow, but in the current environment you’d see the place shutting down within a year. What good’s a $50K a year job if it bankrupts the company?”
That is the crux, instead of paying 10 shitty employees, shitty wages, pay 5 quality employees to do the same job and pay them double. I am always of the impression that if you hire highly skilled, quality workers and pay them good wages, you don’t need a multitude of crappy employees. Trust me, I see it everyday. I work at a restaurant. If I was the GM half of them would have been fired already, the good employees have to pull the weight of the shitty ones, and it isn’t fair. Obviously I make better money, because I am better at my job, and that is the point I am making.
And in all honesty, if the Leader closed its doors would anyone shed a tear? Well ok I’d miss the comics but other than that……
Their comics even suck. I only read Dilbert.
This is a great post about this topic on another SD blog:
http://reimaginerural.com/talent-attraction-if-its-right-for-sioux-falls-is-it-right-for-small-towns/
Thousands of corporations are coming. Mikey talked to them.
Sure they are…around the time that Darrin gets us all lower airfares?
Director of digging up mud on Mike’s opponents.
A blogger with a geography background has picked up this topic – http://burghdiaspora.blogspot.com/2010/07/war-for-talent-sioux-falls.html.
Somebody should run for mayor 2014. Is it to early?
If the platform is repeal Home rule, you’ll attract enough votes away from Huether. Darin will spend lots of campaign money lavishly but it’ll not help.
A ‘One term wonder’ in progress. I can tell by the out front caged hands and THC-like revelations.
Maybe Janoct?
Talk to Aberdeen about that economic model of emptying the small towns. It worked GREAT, for about two generations – until Aberdeen became a bigger small town worthy only of emptying. Now Aberdeen’s closing schools, shuttering businesses as folks shop in Fargo, MSP, and sometimes SF. And they fly out of Fargo and MSP. Great economic model – if one is in the race to the bottom.
We get people from Aberdeen at the restaurant I work at all the time.
GoD I tell people all the time that there is no good reason to live anywhere in the SF metro except in SF.
I have to disagree with you on that point. First of all not everyone wants to live in the city, because not everyone wants to deal with metro issues, traffic, politics, crime, or schools. I call them naive, but you find a lot of people who don’t even lock their cars in Brandon and Harrisburg… some even leave the keys in them when parked downtown. Try that in Sioux Falls sometime and see how long your car stays put or your CDs don’t walk off.
There are also people who grew up in small towns who would prefer something like Tea or Lennox where they know the kids can walk to and from school in five minutes rather than spending an hour on a bus each direction. Some parents prefer a small school where you know the teachers and administrators and run into them at the convenience store when you are filling up with gas.
Some people also like larger lots – and in Sioux Falls even a $350k home is often found with a setback on each side of no more than eight feet. Some people want to live on the water or have some greenspace behind them… if they move to Tea there are at least three different ponds that I’m aware of – but where can you have that in Sioux Falls?
There is also the issue with people who want to have an acreage. I personally find that very appealing, but you can’t have 5 or 10 acres and still be in Sioux Falls. Ok technically you can, but the last place by the river that had 8 acres I think was listed for something like $2.5M… so needless to say the average guy isn’t about to swing that.
Honestly there are a lot of reasons people prefer to live in small towns. I will admit some people often underestimate their fuel usage to commute back and forth, but then again I don’t know many spending $450 a month on gas either.
Heck… do the math on that one. If you have a very average car getting 22mpg and we assume gas costs $3.00 a gallon (to make the math easy) – you are saying that someone who lives in Harrisburg is driving 3300 miles a month or almost 40,000 miles per year?
I don’t think so.
Actually I have friends who have lived in Harrisburg and in Tea, and they sometimes have shorter (time wise) commutes than I do depending on where we are going. I don’t think it is nearly as inconvenient as some people assume. Unless you live in the central core of Sioux Falls, it isn’t any worse living in Harrisburg or Brandon than it is living in the far Northeast or Southwest corners of SF. And keep in mind not everyone can live near downtown unless you want to eliminate the concept of the single family home and replace it with multi-family towers.
not everyone wants to deal with metro issues, traffic, politics, crime, or schools. I call them naive, but you find a lot of people who don’t even lock their cars in Brandon and Harrisburg… some even leave the keys in them when parked downtown. Try that in Sioux Falls sometime and see how long your car stays put or your CDs don’t walk off.
I got a good laugh from your mention of traffic. SF only has bad traffic for about 15 minutes a day and when a major street is under construction. And I work DT and leave my car unlocked for hours at a time some days – usually not on purpose. Nothing has ever been stolen from our lot.
The “crime, traffic, and politics” argument is more perception than reality. The schools in SF also offer more variety of classes (AP classes especially) and better ECAs.
Heck… do the math on that one. If you have a very average car getting 22mpg and we assume gas costs $3.00 a gallon (to make the math easy) – you are saying that someone who lives in Harrisburg is driving 3300 miles a month or almost 40,000 miles per year?
They live in Brandon and both work in southern SF. Their kids are involved in a lot of activities in town. So yeah, they drive a lot.
Otherwise you make good points about lot sizes. However, most of the new construction in the burbs looks just like tract housing in SW SF.
Keep in mind when people talk about crime, or schools, or traffic it is all relative. It isn’t like SF has a bad crime problem, but people in a lot of small towns don’t even lock their houses when they go to work and they leave keys in the ignition all night while the car sits in the driveway (I personally know idiots who do this).
That isn’t to say you couldn’t get away with it in Sioux Falls, but it is much less likely.
As to traffic, I know people who won’t even drive near the mall on the weekends – so although we don’t have a real traffic issue, in comparison to Crooks or Brandon… yea it probably looks pretty bad when you just want to pick up some bread and milk at the grocery store on a Saturday.
Now as to the schools… I’ve made the same argument myself that Sioux Falls offers more, but others have argued with me that more is not always better. Some people like small towns and the small schools that come with them. They like knowing the other students and all of the teachers. You won’t get that same atmosphere (for better or for worse) in Sioux Falls.
It really just boils down to perception and personal preference. Actually my biggest gripe about smaller towns generally has to do with taxes.
I looked up a couple of houses and in Sioux Falls a house with an assessed value of $267,000 pays about $3950 in taxes per year.
In Tea, a house with an assessed value of $276,000 pays $6100. WTF.
I realize Tea has to pay for some new schools and probably some water infrastructure, but $2k a year more? That is extreme.