Sioux Falls Featured in L.A. Times for Resiliency

L.A. Times: What recession? Places Like Sioux Falls, S.D., Prove Resilient

States in the country's midsection have largely avoided the current economic misery. Some businesses are even expanding.

Reporting from Sioux Falls, S.D. -- Mayor Dave Munson drove past acres of chopped-up prairie and pointed matter-of-factly at signs of economic health that are hard to come by in most of the country.

"This is going to be a very strong retail center," he said, waving at one graded lot where a Target store is to be built. He gestured at the other side of the road. "There's another development."

A few years ago, many cities were pocked with freshly overturned dirt soon to be retail or residential developments. The most severe recession in 70 years has changed that in most places, but not in this community of 150,000 and others like it in the midsection of the country.

One chunk of the nation has avoided much of the current economic misery: the region from North Dakota to Texas, most of it sparsely populated. This area includes five of the six states that analysts at have classified as not yet in recession. And other states in the Rocky Mountain West -- from New Mexico to Idaho -- are facing relatively mild downturns.

States like South Dakota rarely figure in the national economic discussion, which focuses on population and business centers on the coasts or in the Rust Belt and Southwest.

But the nation may end up looking a little more like Sioux Falls. Home prices inched up 2% last year, but didn't increase more than 5% a year during the preceding housing boom. There is a mall and a couple of shopping centers, but a lower density of stores than in most metropolitan areas.

The city has an unemployment rate of 4.8% -- up nearly 2% in the last three months, but still less than half that of Los Angeles -- with jobs in service fields such as healthcare and call centers rather than manufacturing. Home-building is healthier than elsewhere; permits for new single-family homes are half of what they were here at their 2003 peak, but nationwide have fallen by two-thirds from their peak.

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Nicholas Riccardi
L.A. Times