South Dakota is winning the US jobs race: Gov. Daugaard

South Dakota has the lowest unemployment rate in the US at 2.5 percent.

South Dakota Gov. Dennis Daugaard
Source: Office of the Governor
South Dakota Gov. Dennis Daugaard

When people around the country think about South Dakota, the first image that comes to mind is probably Mount Rushmore. Though we're proud to be the home of Gutzon Borglum's masterpiece, the truth is, we are much more than the stone-carved presidential tribute. South Dakota is a great place to do business.

We have long strived to make our state business-friendly, and people are beginning to notice. As a number of independent groups who conduct state-by-state studies are rating South Dakota at the top, businesses are looking to South Dakota.

In 2013, CNBC named us America's Top State for Business. CNBC continues to give us high praise for our business friendliness, placing us second in the 2015 ranking of business-friendly states. The U.S. Chamber of Commerce Foundation also gives us high marks for our business policies and climate.

We're seeing success in South Dakota because we believe in allowing businesses to prosper. We have no corporate income tax, no personal income tax, no business inventory tax, no personal property tax and no inheritance tax. This puts more money in the pockets of our businesses and citizens, creating a more favorable environment for growth.

Cost of doing business

Things are just as impressive when it comes to actually doing business in South Dakota. The costs of doing business — utility costs, unemployment insurance costs, workman's compensation costs, land costs — are low. Productivity of our workers is high. In fact, many multistate employers with locations in South Dakota tell us their South Dakota location is their most productive.

"When I took office, I began a red tape review to eliminate unnecessary statutes and rules. To date under this initiative, we have eliminated more than 450,000 words of red tape."

We don't place unnecessary hurdles before our citizens or entrepreneurs, and things aren't overly complicated for people who are trying to know and obey laws. It's the nature of government to add to the body of laws. Some tend to perceive productivity as the amount of legislation that is passed.

But when it comes to laws, more isn't always better. There's merit to throwing out regulations no longer needed and repealing overburdensome laws. That's exactly what we've done in South Dakota. When I took office, I began a red tape review to eliminate unnecessary statutes and rules. To date under this initiative, we have eliminated more than 450,000 words of red tape.

It's not surprising that South Dakota has the lowest unemployment rate in the nation, at 2.5 percent. We are a state of hard workers. With more than 115,000 South Dakotans working in agriculture, many of us grew up on farms or ranches or have family or friends with agricultural operations. Because agriculture is a part of our heritage, the value of hard work has been passed on from generation to generation.

The country's oldest balanced budget

Since we became a state in 1889, the South Dakota Legislature has balanced the budget every year. We don't do it with accounting gimmicks, either. We don't push one year's expense into the next. We don't use onetime windfalls to fund ongoing expenses. We never issue general obligation bonds.

Many states are starting to balance their budgets again. But far too many of those other states have long-term liabilities, unfunded pension obligations and large general obligation liabilities. In South Dakota we have neither of those things. Our state's pension is more than 100 percent funded. Other states will eventually be forced to confront those liabilities, probably at the expense of entrepreneurs and businesses.

It is because of these practices that South Dakota has recently been awarded the highest credit ratings possible from Moody's, S&P, Fitch. As the nation and some states have experienced downgrades, South Dakota's stewardship is paying off. The upgrades we have received are another indication that we are on the right track.

Thanks to our history of fiscal responsibility, it is likely South Dakota will continue to be the place to do business. Businesses plan for the long term. When considering moving or expanding, they need stability and certainty. They need to know that government won't get in their way. That's what we can offer here in South Dakota.

— By South Dakota Gov. Dennis Daugaard

Editor's note: This commentary was written before the release of the Top States 2016 data. The governor did not have knowledge of the rankings or the comprehensive data. South Dakota finished 2nd in business-friendliness in this year's ranking and No. 19 overall.