Marcia Erickson says housing shortage stalls rural SD Economy

Marcia Erickson says housing shortage stalls rural SD Economy

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The Housing Bottleneck Stalling South Dakota’s Rural Economy

In a recent column for plaintalk.net, Marcia Erickson, the founder and CEO of GROW South Dakota, argues that the most significant barrier to economic growth in the state’s rural regions is not a lack of jobs or interest from workers, but a systemic shortage of available housing. According to Erickson, employers in towns such as Sisseton, Milbank, and Winner are actively hiring, yet they struggle to fill positions because incoming employees cannot find a place to live.

This mismatch between job creation and residential capacity has become a defining challenge for rural development. Employers—ranging from manufacturers and agricultural businesses to health care providers and schools—frequently report that they successfully recruit talent, only to have those hires turn down the positions upon discovering that no housing is available within a reasonable commute. As Erickson observes, the economic vitality of these communities is currently capped by their physical infrastructure.

The Hidden Costs of Rural Development

The housing crisis in rural South Dakota carries unique complexities that differ from urban or suburban counterparts. Erickson points to several factors that complicate the development of new housing stock: the high cost of renovating older, dilapidated homes; the logistical challenge of contractors traveling long distances to reach remote job sites; and a lack of comparable sales data, which often makes it difficult for lenders to justify financing for new, modest construction. These hidden costs, while not always visible on a closing statement, effectively inflate the price of entry into the rural housing market.

Lori finnesand marcia erickson

The situation is particularly acute in tribal communities, where decades of restricted access to traditional mortgage financing have made homeownership a difficult goal to reach. To address these hurdles, Erickson highlights the importance of sustained partnerships with organizations such as Lakota Funds, the NeighborWorks Dakota Coalition, and the South Dakota Native Homeownership Coalition. These groups prioritize long-term, patient investment and the cultivation of local relationships to build homeownership on tribal land, a process that Erickson notes requires years of persistence.

Leveraging Regional Partnerships

GROW South Dakota, which was founded in 2007, operates as part of the broader NeighborWorks America network. This national platform encompasses nearly 250 community-based organizations. By working within the NeighborWorks Dakota Coalition, which serves both South and North Dakota, these organizations have been able to pool resources to make projects financially viable in areas where profit margins are notoriously thin.

South dakota usda rural development n

In fiscal year 2025, the coalition supported 117 households in achieving homeownership. The financial structure of these efforts relies heavily on the ability to leverage small amounts of grant money into larger investments. During that same fiscal year, the four member organizations utilized $1.59 million in NeighborWorks America grants to generate more than $213 million in total investment. Erickson emphasizes that this multiplier effect—amounting to roughly $134 for every grant dollar—is not merely a metric for reporting, but a functional necessity for bringing rural housing projects to fruition.

Building homeownership on tribal land doesn’t happen overnight. It takes time, persistence and people who are committed to showing up year after year.

Aligning Housing with Economic Strategy

The path forward, according to Erickson, requires a shift in how rural communities approach growth. She advocates for integrating housing policy into broader economic development conversations from the outset, rather than treating it as an afterthought. This approach requires specific financing tools tailored to the scale of smaller towns, alongside technical support that recognizes the unique constraints of rural geography.

Competition for materials and labor limits needed housing growth in South Dakota

The argument rests on the premise that rural communities have historically relied on collective action to solve systemic problems. By aligning the interests of builders, lenders, employers, and local government, these towns can foster opportunities that would be unattainable for any single entity acting in isolation. For the communities of Sisseton, Milbank, and Winner, the presence of long-standing hiring signs serves as a clear indicator of employer confidence in the region’s future. The challenge, as Erickson frames it, is ensuring that the housing market evolves at a pace that allows that future to actually take root.

Worth a look

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