South Dakota experienced its strongest economic growth since 2011 as the economy expanded by 1.8 percent in 2015, according to new data released by the U.S. Bureau of Economic Analysis (BEA). While the U.S. economy grew by 2.4 percent, the state’s inflation-adjusted economic growth rate was good enough to rank 22nd among the 50 states, and 24th on a per-capita basis. The state’s total GDP in inflation-adjusted dollars was $40.7 billion.
During all of 2015, growth in South Dakota’s gross domestic product was led by expansion in the agriculture, forestry, fishing and hunting sector, which increased on an inflation-adjusted basis from $3 billion to $3.2 billion, and retail trade, which rose from $2.9 billion to $3.1 billion. Other sectors showing positive growth in 2015 included construction (from $1.6 to $1.7 billion), health care and social assistance (from $3.6 to $3.7 billion), professional and technical services (from $1.1 to $1.2 billion), real estate and rental and leasing (from $4.1 to $4.2 billion), and wholesale trade (from $2.9 to $3.0 billion). Declining sectors included manufacturing (from $3.9 in 2014 to $3.8 billion in 2015) and transportation and warehousing (from $1.0 in 2014 to $0.9 billion in 2015).
South Dakota’s growth in 2015 was the fourth best among surrounding states, topped by Montana (3.5 percent), Minnesota (2.4 percent) and Nebraska (2.1 percent). Meanwhile, a significant decline in mining activity contributed to a contraction of gross domestic product in North Dakota (-2.1 percent).
Fourth Quarter 2015
In the fourth quarter alone, South Dakota’s gross domestic product grew by 2.3 percent, buoyed by the agriculture, forestry, fishing and hunting sector; as well as construction, wholesale trade, professional services, management, health care, and information.
South Dakota’s economy grew in the fourth quarter despite significant setbacks in key sectors and neighboring states. A national decline in the finance and insurance sector in 2015, for example, resulted in a drop in this sector in the fourth quarter in South Dakota. Other declining sectors included real estate, accommodation and food service, mining, utilities, non-durable goods manufacturing, transportation and warehousing, and government.