South Dakota chickens are apparently slacking off. About 2.63 million chickens laid 752 million eggs in South Dakota last year, but according to the USDA, that's a 4% drop laying chickens and an 8% drop in egg production.

Sonstegard Foods would single-handedly triple the number of laying chickens in our fair state with their proposed six-million-beak egg factory near Parker. Opponents are suing Turner County over allegedly improper zoning actions that would allow Sonstegard Foods to plunk those chickens and all their emissions less than three miles from town, not to mention within noseshot of nice folks who enjoy peaceful country living.

Sonstegard Foods says we won't notice the stink when they bring 150 jobs to Parker (maybe ten years from now). Jobs, mind you—not careers, not opportunities for independent farmers and landowners to captain their own destinies, just jobs... or maybe serfdom:

Chicken farmers are usually contractors for big companies. Most of them don’t even own the chickens they raise.

The chicken industry, like much of the meat industry, is what’s called “vertically integrated.” That means the company controls or owns almost every step of the production process, and competition between entities is minimal.

Companies usually own the breed of bird, and the hatchery where chicks are born. Same with the chickens they deliver to the farmer, the mills that make the feed farmers use, the slaughterhouse – and often even the trucking lines that deliver the meat to market.

Usually, the only thing they don’t own is the farm where the chickens are grown — the riskiest, lowest-yielding stage of the production line. The farmer has little control over what chicks he’s given, and little say in how they are raised. Some compare contract chicken farmers to sharecroppers.

[Says ag policy professor Robert Taylor,] “The farmer, if push comes to shove, is nothing more than an indentured servant or a serf, because the farmer is completely at the mercy of whatever the company decides to do" [Mariana van Zellar, "Cock Fight," Fusion, February 2015].

Farm entrepreneurs won't flock to Turner County for that kind of chicken feed. Like Beadle and Brown counties, Turner County will likely have to turn to an immigrant workforce that just happens to be easier to indenture.

Don't get me wrong: I'm all for the economic and cultural growth immigration brings to South Dakota. But are we really improving our quality of life by promoting businesses that offer literally crappy jobs that most South Dakotans don't want to do?

* * *

We're really a food manufacturer that happens to have chickens on site.

—Peter Sonstegard, VP of sales, Sonstegard Foods, quoted in John Hult, "6M Chickens Could Come to Roost in Turner County," that Sioux Falls paper, 2015.01.27

32 comments

What was that I said—wait, that the City of Pierre said—about workers recruited from out of state not sticking around? That's not Huron's experience.

Where Pierre's workforce development project is all about cultivating workforce among existing residents, Huron going big on recruiting and retaining workers from the other side of the planet. Since 2007, 2,500 Karen refugees have come from Burma to live in Huron. The Karen came at first to work Huron's big turkey plant; they now hold jobs in 30 Huron area businesses, and Huron wants more. The big ticket item on Huron's workforce development grant application (which the state approved for the full $125,000 requested) is "Diversity Engagement," which includes more direct recruitment of Karen refugees in surrounding states, more English classes, more job fairs targeted at workers who aren't fluent English speakers yet, and more big Karen cultural events like soccer, volleyball, and cane ball tournaments and Karen New Year celebrations (January 5—welcome to 2754!).

Huron also plans to use its state grant to sponsor more management training classes. It's one thing to learn enough English to get a job at the turkey plant; it's another to learn enough English to run a production shift and budget meetings. Huron needs more of its Karen residents, who now hold one out of nine jobs in Beadle County, to be able to move up the ladder and fill the white-collar jobs from which baby boomers are retiring.

By the way, Huron's application states that in a survey of Karen residents, it found that "100% of participants felt welcomed in the community and had experienced no racism since arriving." That cultural acceptance is a key part of getting folks recruited from elsewhere to stick around. Huron and the state appear willing to invest heavily in pening their doors even wider to convince these newcomers to stay.

36 comments

The fourteen community workforce development grants recently approved by the states are heavy on local training. Consider the grant the City of Pierre won. Pierre proposed a $100,000+ two-pronged program.

First, Pierre says it needs more truck drivers for construction (how's that for specific workforce needs?). They want to create a branch of Mitchell Technical Institute's commercial driver's license (CDL) training program in Pierre. They also want to cover the cost of that training and licensing (about $2,500) for each of those potential drivers. In return, the new CDL holders would promise to work for their sponsoring company for a period to be determined or pay the money back of they leave early.

Second, Pierre wants to target the 10% of local high school students in the area who apparently don't have solid post-secondary education or career plans with a job-shadowing program. The city would line sixteen kids up with employers who need more potential workers in their hiring pipeline. The shadowers would do real work eight hours a week for sixteen weeks. They'd get paid real money, $10 an hour—a quarter from the business, a quarter from the city, and half from the state grant.

Pierre asked for $50,240 from the state; they got $20,480, which equals the total cost of the job-shadow program.

Why would Pierre focus on training local young people and current residents who can't afford CDL training? Let me highlight one passage from Pierre's application:

...[W]e looked at strategies for building that pipeline and identified two primary options.

  • recruiting people from outside of South Dakota
  • engaging people who are already near, but not currently engaged in the workforce

Our employers tell us, historically those who come from outside the area don’t stick around. To retain employees, they need a local connection. So, we chose the engagement route and explored a number of disengaged workforce sources... [City of Pierre, Community Incentives Matching Program grant application, November 2014].

Trying to recruit out-state workers apparently doesn't work, at least not in Pierre. Our capital city thus chooses to grow its own workforce.

Update 11:01 CST: Hmmm... the Gregory Business and Industrial Development Corporation is getting $7,000 from the state as part of its $14,000 program to help local folks get their CDL. Gregory's application says the cost of CDL training and testing through MTI is $1,600 per student, not $2,500. Gregory will support ten students in their CDL class. The state will pick up $700 for each student, local GBIDC donations another $700, and each student the remaining $200.

20 comments

Did you know Governor Dennis Daugaard and billionaire Denny Sanford aren't the only guys proposing a vo-tech scholarship? A month prior to the big announcement of the Build Dakota Scholarship, the Rapid City Economic Development Partnership and other interested Black Hills parties applied for one of those workforce development grants from the state. They asked for $220,000 from the state to support their $440,000 three-year plan; they got $70,000.

The Black Hills plan included all sorts of leveraging and marketing (after two years of top-secret prep, the Black Hills economic developers last year launched "a new economic development branding and marketing effort, unified as Rushmore Region"), career coaching at the K-12 level, metalwork training and certification, and more.

The Black Hills plan also included a scholarship proposal:

We are proposing to create a regional skills-based training scholarship fund, that when matched by the employers seeking the trained employees, would make possible the opportunity for many of these unemployed and often underemployed job candidates to round out their skills/certifications and thus qualify for these attractive job opportunities. This would supplement our recruitment strategy by helping our employers locate employees who are almost ready, but who lack one or two critical skills prerequisite to being hired [Rapid City Economic Development Partnership, Community Incentives Matching Program grant application, November 2014].

Great minds think alike, I guess.

Ben Snow, president of the RCEDP, tells me he and Blaise Emerson of the Black Hills Council of Local Governments are still working on details of the scholarship component of their plan:

We are... encouraged that coincidental to the day we were delivering our presentation to the workforce board, the announcement of the Sanford gift for skilled-trades scholarships was taking place in Sioux Falls and that it is very close in concept to what our proposal included, except on a statewide basis and at a much higher funding level [Ben Snow, e-mail to Madville Times, 2015.01.20].

The Build Dakota Scholarship workforce fields are to be determined within the next couple weeks. If they align with the needs our Black Hills boosters see in their workforce, the state and RCEDP should be able to pool resources and train even more workers for the Black Hills labor pool.

8 comments

Wait a minute: now addiction is a workforce issue?

Leaders of Face It Together say support for people with that disease is especially important during the state's current worker shortage. An Aberdeen affiliate plans to open later this year.

...Because addiction can lead to less productivity and even the loss of skilled workers, leaders of Face It Together believe helping those employees is a money-saving investment for businesses, especially when workers are in short supply.

"We need to be able to help them seek recovery and treatment so they can stay in the workforce and stay in the community and be a vital component to our community," [business owner Troy] McQuillen said [Erich Schaffhauser, "Face It Together Expanding to Aberdeen," KELOLand.com, 2015.01.22].

What? Helping people overcome addiction is no longer rooted in supporting the intrinsic worth of every human being, but now arises from an instrumental view of people as cogs in the economic machine?

No, Face It Together simply understands its audience and is tuning its pitch to business-minded donors:

Through partnerships with Aberdeen businesses and other donations, the group is hoping to raise $150,000 to start offering services in the Hub City by June.

...The organization is looking to partner with any sector that could benefit from fewer people facing addiction [Schaffhauser, 2015.01.22].

Maybe we can adapt that workforce approach to sell raising money for teacher pay, too. We don't raise teacher pay to recognize the fundamental dignity of teachers and the moral worth of their work. We don't raise teacher pay to show our love for children or our appreciation of the inherent value of knowledge. We raise teacher pay because teachers are instrumental to building our workforce. Arbeit und Wirtschaft über alles!

64 comments

The Belle Fourche Development Corporation recently won one of the state's fourteen workforce development grants with an affordable-housing plan that mirrors one proposed on the Madville Times seven years ago. The Belle Fourche housing plan also reveals a fundamental market failure in providing housing for workers.

The state is giving Belle Fourche $175,200 to help buy three lots, build three basements, plunk down three three-bed two-bath Governor's Houses, and hook them up to utilities. The total cost for each property will be $143,884. The city will also draft high school students taking vo-tech classes to build two more new houses during the next school year.

BFDC's application says that big new companies since 2013 have stimulated the Belle Fourche economy with $20 million in capital investment and 160 new jobs. However, those new workers can't find decent affordable housing in Belle Fourche and are having to commute from Rapid City and elsewhere. BFDC includes in its application a July 2014 letter from Permian Tank plant manager Robert Sieve saying that affordable local housing is "an important factor in our employee satisfaction and retention."

I agree with plant manager Sieve: a two-hour commute increases the chances that workers will keep their eyes open for work closer to home and stick the company with more frequent turnover costs. The Belle Fourche Development Corporation is serving the interests of labor, management, and the community as a whole in promoting affordable, quality housing.

But I see in Belle Fourche's plan the same market failure that I've seen in housing development in Madison. Back in 2008, the Madison City Commission granted developer Randy Schafer a tax increment financing district to subsidize construction of working-class housing that Schaefer told me would not get built without government help. In his last great economic development project, Richard Benda convinced the Lake County Commission that market demand wasn't enough to build workforce housing and secured tax increment financing for 28 townhouses in Madison. Tax increment financing will build another 14 housing units on the east side of town.

The assumption in Madison, Belle Fourche, and (as evidenced by the grant award) Pierre is apparently that the market is broken. Housing is a basic need; the market fails to build and maintain enough decent, affordable housing; therefore, government must act with tax subsidies and labor provided by prisoners and public school students.

I agree that government properly acts to redress market failures. But what part of the market is failing? Is supply failing to respond to obvious demand? I have a hard time believing that South Dakota contractors are willing to turn down an opportunity to make money building houses. It seems more likely the market failure lies on the demand side: workers would like houses, but their new employers in Belle Fourche, Madison, and elsewhere in South Dakota aren't paying the wages that will convince the bank to sign the mortgage.

Workers need houses. Belle Fourche is taking reasonable action to help workers get houses. But I worry that Belle Fourche's action and the state money supporting it, like other state programs, subsidizes employers who are shorting their employees the full paychecks they deserve.

23 comments

You know that argument South Dakota Republicans like to make that South Dakota's purportedly low cost of living makes up for South Dakota's low wages?

That argument is working for workers, says the Aberdeen Development Corporation, discussing the problem of recruiting workers in northeastern South Dakota (NESD):

Compounding this challenge is the difficulty we face retaining future stakeholders in our community who are graduating from our colleges and regional technical schools. A large portion of these individuals have the desire to stay in NESD, but are not finding competitive salaries for knowledge-based jobs available in NESD. Therefore, they leave for higher paying jobs in larger cities in other states, regardless of the cost-of-living increase they may encounter. Even those who may be unskilled leave NESD for higher paying manufacturing jobs in other states due to higher wages, but also because of the opportunities available to them including free/less costly education or additional technical training to advance their careers. Once they have left and settled into careers in other states, it becomes quite difficult to recruit them back to South Dakota [Aberdeen Development Corporation, Community Incentives Matching Program application, November 2014].

The state is granting the Aberdeen Development Corporation $60,000 to work on research, marketing, recruitment, newcomer integration, vo-tech classes, and graduate retention. Not included in the grant proposal: an initiative to promote higher wages.

8 comments

Governor Dennis Daugaard addressed several important topics in his State of the State Address to open the 2015 Session of the South Dakota Legislature this afternoon. He made up for a glaring omission from his December budget address by focusing the first half of his speech on roads and bridges. The Governor needed to do that to jump out in front of Senate Bill 1, a massive proposal from the Interim Highway Needs and Financing Committee. Governor Daugaard made clear that he "appreciates" the committee's efforts, but by gum, if taxes are going to get raised and roads get fixed, it's going to be done the way he says so. The Governor says he will be submitting his own bill on road repairs.

To justify the coming tax increases—and among the highlights, Governor Daugaard proposes outdoing Senate Bill 1 by raising the motor fuel tax two cents every year, starting now—the Governor emphasized that our economy and "our entire well-being" depend on good roads, and "our roads are underfunded. Governor Daugaard said nothing about how our economy and statewide well-being depend on K-12 education, and he said nothing about how our K-12 system is underfunded.

The Governor took time to promote his juvenile justice reform plan, which is apparently supported by everybody and requires little salesmanship. He took no time to mention how improvements in K-12 education would keep kids from ever falling into the juvenile justice system in the first place.

The Governor discussed his workforce development plans address the shortage of workers in certain technical fields and in health care. The Governor said nothing about the widely recognized K-12 teacher shortage.

The Governor talked up his rural agricultural development programs. He said the state has won an award for its innovative site-analysis program designed to help counties determine where they can put CAFOs and other big ag businesses. The Governor did not mention that good teacher pay is crucial to sustaining rural communities where the public schools are often the largest employers.

The Governor praised the state's investment in parks and pheasant habitat. The Governor said we need to spend money to preserve grasslands so pheasants have places to live and sustain our hunting our industry. The Governor said nothing about the need to make South Dakota friendly habitat for teachers.

The Governor led a rousing ovation for the South Dakota National Guard, which for the first time in ten years has not one soldier deployed overseas. The Governor did not call for any such ovation for the teachers, firefighters, construction crews, ranchers, stay-at-home moms, or other groups who serve the Republic.

The Governor's only acknowledgement of K-12 education came in praising high school vo-tech classes (which Governor Daugaard's own budget austerity has cut) and dual-credit courses (which are a really good idea, helping kids get a jump on college and save money and helping South Dakota universities recruit South Dakota students).

The bad news from the State of the State Address is that Governor Daugaard does not appear to have any plans to do anything for South Dakota's public school teachers. The good news may be that he doesn't plan to do much to us, either. (Whew—maybe that means we can focus on fixing that really bad House Bill 1044, the Teacher Inquisition bill.)

43 comments

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