Agriculture has traditionally dominated South Dakota's economy. Grains and livestock have been the main farm products, and processed foods and farm equipment the leading manufactured items. However, since 1970, 44 of South Dakota's 67 counties have lost population, and for five these counties, the rate of depopulation accelerated during the 1990s. The prolonged drought affecting many western states and which helped to reduce the state's corn production 10% and soybean production 6% in 2002 and disrupted cattle production, worsened in the winter of 2002–03, threatening another below-average season. The historically important mining sector was contributing less than 1% of total state product in 2001. South Dakota's tax free environment was designed in part to attract high-technology, financial, and manufacturing investments during the 1990s. Manufacturing output grew at a substantial 16.9% 1997 to 2000, but then plummeted 10% in the recession year of 2001, reducing the manufacturing share in gross state product from about 13% to 11.3%. The strongest growth in output has been in various services sectors. Coming into the 21st century (1997 to 2001), output from financial services increased 42.6%; from government services, 29.4%; from general services, 28.7% and from wholesale and retail trade, 21.4%.
In 2001, South Dakota's gross state product gross state product was $24.3 billion, the 5th smallest among the states, to which financial services contributed $5.4 billion; general services, $4.2 billion; trade, $4.16 billion; government, $3.3 billion; manufacturing, $2.7 billion; transportation and public utilities, $1.8 billion, and construction, $963 million. The public sector in 2001 constituted 13.5% of gross state product, compared to the 12% average for the states.