South Dakota’s Diverse Economy Aids Recovery, But Risks Remain, Experts Say

South Dakota’s economy faced a 3.1% contraction in the first part of the year due to trade disruptions and low commodity prices, but rebounded with a 5.2% surge in the second quarter, thanks to federal relief from the Emergency Commodity Assistance Program (ECAP). The Dakota Institute, a group of regional economists, including research fellow Devan Schaefer from South Dakota State University, highlighted the importance of a diversified economy in weathering volatility. Schaefer cautioned that while South Dakota’s economy includes finance, banking, retail, and agriculture sectors, they are not immune to national and international shocks. Economists are closely monitoring the long-term impact of ECAP to determine if it was a one-time stimulus or if its effects will guide the state through future challenges.