Wages not keeping up with housing costs

As you will see, this isn’t just happening in Sioux Falls and South Dakota, but across the nation;

Of the roughly 420,000 South Dakota jobs classified by the U.S. Department of Labor, several sectors dominate. About 63,000 jobs are in office support positions, another 47,000 in retail sales, about 42,000 in food preparation and service, 17,000 in grounds maintenance, 15,000 in personal care and service and 11,000 in health care support. South Dakota is routinely among the top states in percentage of residents who hold more than one job.

But what is that statistic? I have often wondered where to get that.

In the Sioux Falls metro market, inflation-adjusted median household income fell by 4.5 percent from 2008 to 2015; in the city of Sioux Falls, it fell by 8 percent over that time frame. Meanwhile, the number of households making $15,000 to $25,000 a year in Sioux Falls jumped by 50 percent during that period.

It’s really the middle-class income that hasn’t really changed at all.

That the housing shortage for low-income residents is worsening in Sioux Falls. The study notes that for every 100 families making 30 percent or less of the local median family income, only 39 affordable housing units are available.

I have often argued that Sioux Falls is growing too fast, growth for growth’s sake essentially. I was watching a news story last week where they were training middle school kids how to build houses. Really? While I don’t have a problem with industrial arts (I took 3 classes in school, drafting, wood working and construction) I also helped work construction with my brother and dad’s business.

Maybe we just keep building to just build. Sioux Falls really needs to slow it down a bit and concentrate on fixing up core neighborhoods and revitalization, which provides affordable housing. Sprawling out of our limits only drives up infrastructure and housing costs. Making due with what we have with the workforce to do it properly instead of this constant motion of ramrodding development.

We really don’t have a housing issue, we have a wage issue.



3 comments ↓

#1 JKC on 06.23.18 at 10:08 pm

A course, it is all about wages and the meth problem, and the growing division over our immigration policy, too, all stem from the lack of wages here and throughout the country. Because all of our problems today are linked to a lack of adequate wages. For sadly, America is becoming one big South Dakota, whether it be the Justice Department becoming politicalized, the elite controlling our political parties, or tax policies being implemented, which further empower the 1% at the expense of the many.

As we are all aware, last August, Federal Reserve Banker, Nell Kashkari, a conservative Republican I might note, spoke to the Sioux Falls Downtown Rotary Club and chided our local business community for not paying its workers enough. He claimed that if you have a workers shortage, it is because of your wages and that one only has to look at the Bakken region, and how they dealt with a worker shortage by increasing wage, to understand that increasing wages is the answer….. Because it works…. And in so doing, you make many more lives enjoyable through greater opportunity from just wages.

But I question if the elite really care about most people. They would rather use the poor, the working poor, and the collapsing middle class as the underpaid slaves for a service economy designed to facilitate the needs of the 1%, and the upper middle income.

Although, the upper middle income is expanding and is greater than it has ever been. It will never replace the middle class in size and make us all upper middle income Americans. So given that, we must be gravely concerned about terms like “Workforce Development” or having middle schoolers build homes. Because the elite in our society, with the enabling upper middle class at hand, are not interested in empowering people through a sound and rounded education rather they want to channel people at as early an age as possible to be nothing but service workers for the rich and the upper middle income…. So when you see middle schoolers being asked to do the dirty work, or a take look at the current Administration in Washington advocating the combining of the Labor and Education Departments together, remember, they are not working to merely save taxpayer money, rather they are working to change the fabric of our country, so that the masses can merely work for the few with an inferior education and a lacking wage through the combined efforts of a new federal government and school curriculums throughout the country, that do not care about most and hope the masses will be too under educated to have an effect voice for change in the future.

And, the indifference of our local business community to heed the advice of Mr. Kashkari in the past year, speaks to the arrogance of our business community, which is far more concerned about building an Arc of self commemoration, when they should be building an economic ark, which we can all have in common…

Nothing proves this all of this better, then when you look at the lack of affordable median priced homes in this city, which is caused in my estimation by the sure creed of the contracting and developing crowd in this town. Because my educated guess is, that the major reason more of these types of homes are not being built is because there are not enough workers to build them and the margins are smaller per unit, so they need to build more to justify it, but they can’t, because of the lack of workers, which they are unwilling to potentially pay more. So what do the contractors and developers do? Well, they take the workforce they have to build higher priced homes to facilitate the needs of the upper middle income and the 1 %, because the demand is not as great, it takes less workers, and the margins per unit are greater…. So if the contractors and developers in this town really cared about Sioux Falls, then they would raise wages and find their profitable margins in numbers rather than in building fewer and less affordable dwellings for the affluent few.

But what do we do about this? Well, for starts the City of Sioux Falls needs an ordinance which requires all employment ads to list the wage scale of the mentioned job opportunity. Such an ordinance would create wage inflation in this town, which is greatly needed. We also need political leaders to take the “Bully Pulpit,” like Kashkari did, and challenge the local business community to raise wages, and I think that Councilman Soehl should lead the fight on this idea for such an ordinance, because he is a former union leader and cares about the working people of this town. I also think we need to be frank and admit that there is wage collusion in this town and that Kashkari’s comments prove this collusion in terms of how his message identified a problem, what is preventing it, and who is preventing it.

Oh, and by the way, speaking of the Downtown Rotary Club, well, a year ago this month the current Democratic nominee for Lt. Governor in this state ended her year long tenure as President of the DRC, so if the Democratic Party is serious about making life better for South Dakotans, then it needs to start fighting for workers, fighting for wages, and not legitimatize those who are a part of the problem and not a part of the answer …..Because even Republican Kashkari knew who, or whom were the problem…..

#ItsWages,Stupid!

#DemocratsNeedToBeDemocrats!

#2 D@ily Spin on 06.23.18 at 11:48 pm

Your perspective is good but let me add somewhat. The upper class wiped out the middle class. There’s invigoration now because nothing happens without a properly compensated commoner population. If one has any sort of skill, they can just about name their wage. Employers are desperate. There’s a housing shortage. It’s time again for Ronning style one like another tract homes. Interest rates are inching up so make it fast. Rents are to high. We need the Central America refugees here with work visas building apartments and homes.

#3 Mike gunn on 06.24.18 at 10:32 am

Although, raising min wage may seem like a great effort to curtail the unbalanced cost of housing? It will only create more of the same. The difficult task that many refuse to accept is why is the problem becoming more of a issue? You have said it in the beginning; that growth is a main factor both by population and building. I agree with that part of the problem.
So with just those two parts in the equation, one has to decide on how they caused the inflation? So I see it this way and could be wrong? But there is many other ways to perceive the growing cost?

Population growth generates a need for more housing does it not? Jobs are abundant yet not keeping up with the wages needed to live comfortably yet,, it is not the job markets fault. More housing needed means; more permits, more inspectors and more revenue to maintain new infrastructure. So taxes increase, the cost to build increase, the cost of materials increase, the cost of land increases “How”? Supply and demand! Look at it like an auction> more is needed by builders and less is available. Prices go up and in turn “taxes go up”.
Each part controls the other no matter which way you look at it. But one! Out of all this perpetual balance the only one to create a livable balance our tax base. Stop spending, growing, charging for things not necessary. Taxes are the one thing we have been taught we cannot live without! I would like to challenge that and use a tighter budget on how it is spent and generated?

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