Economy of South Dakota - Economy

Economy

See also: South Dakota locations by per capita income

The current-dollar gross state product of South Dakota was US$39.8 billion as of 2010, the fifth smallest total state output in the US. The per capita personal income was $38,865 in 2010, ranked 25th in the U.S., and 12.5% of the population was below the poverty line in 2008. CNBC's list of "Top States for Business for 2010" has recognized South Dakota as the seventh best state in the nation. In July 2011, the state's unemployment rate was 4.7%.

The service industry is the largest economic contributor in South Dakota. This sector includes the retail, finance, and health care industries. Citibank, which was the largest bank holding company in the United States at one time, established national banking operations in South Dakota in 1981 to take advantage of favorable banking regulations. Government spending is another important segment of the state's economy, providing over ten percent of the gross state product. Ellsworth Air Force Base, near Rapid City, is the second-largest single employer in the state.

Agriculture has historically been a key component of the South Dakota economy. Although other industries have expanded rapidly in recent decades, agricultural production is still very important to the state's economy, especially in rural areas. The five most valuable agricultural products in South Dakota are cattle, corn (maize), soybeans, wheat, and hogs. Agriculture-related industries such as meat packing and ethanol production also have a considerable economic impact on the state. South Dakota is the sixth leading ethanol-producing state in the nation.

Another important sector in South Dakota's economy is tourism. Many travel to view the attractions of the state, particularly those in the Black Hills region, such as historic Deadwood, Mount Rushmore, and the nearby state and national parks. One of the largest tourist events in the state is the annual Sturgis Motorcycle Rally. The five-day event drew over 450,000 attendants in 2006; significant considering the state has a population of only 790,000. In 2006, tourism provided an estimated 33,000 jobs in the state and contributed over two billion dollars to the economy of South Dakota.

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