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South Dakota e-Labor Bulletin

February 2026

The Information advantage

The Information sector includes businesses that publish books and software, make movies and music, broadcast content, provide internet and phone services, process data, and offer other information services. People often associate the terms ‘information age’ and ‘global information economy’ with this sector.

The global information economy includes two ideas:

1. Industries that produce, process, and share information as their primary activity.
2. All industries use information and technology to increase productivity.

Advancements in technology, including artificial intelligence (AI), have streamlined many processes, allowing some establishments to expand services without additional staff. For example, advances in AI have made customer service more efficient by answering questions and fixing initial problems online.

South Dakota’s Information sector businesses:

• Provide specialized services and processes.
• Produce and distribute information and cultural products.
• Furnish the means to transmit or distribute these products and data; and
• Process data.

The output of this sector is unique in that it is often intangible, meaning it is not physical. Its value comes from the information, education, or entertainment it provides, from its physical form.

The table below shows the structure of this sector within the North American Industry Classification System (NAICS).

From 2000 to about 2010, employment in South Dakota’s Information sector was relatively stable, with only small ups and downs. Around 2011, jobs started to decline. The drop became more evident between 2019 and 2020. This was surprising because information businesses have long been considered an engine of the modern economy.

Why the decline?

Efficiency gains and widespread automation reduced employment needs for many information-related industries, like traditional publishers. Others were hurt by economic pressures like inflation, low consumer spending, high production costs, and evolving consumer preferences like electronic and multi-format content. All these challenges required constant adaptation for businesses to remain viable.

Telecommunications companies, including phone and internet providers, are also part of the Information sector. They are important for mobile communication and the information society. In South Dakota, these companies employ the most workers in the sector. Examples include wired internet providers, cell phone companies, and telecom resellers. While jobs have dropped slightly, overall employment is steady. Technology improvements have simplified processes, allowing some establishments to expand services while making modest staffing cuts.

Another growing industry in the Information sector is Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services. These companies provide computing infrastructure, data processing, web hosting, and streaming support. They serve both individuals and businesses. These companies usually have small workforces, but jobs have grown steadily since the COVID-19 pandemic.

Several factors are fueling the growth:

• Businesses are moving to digital solutions and cloud-based services.
• Remote work has increased demand for web hosting and data services.
• The popularity of streaming services has increased as consumers embraced new technology.

Demand is keeping this industry solid.

The information age or digital age represents a shift to a knowledge-based economy, focused on digital services and automation. While productivity has increased, there has been an erosion in old jobs, replaced with technology-driven ones. Information technology allows instant communication and fast data access, fundamentally altering work, culture, and social life. South Dakota has had some employment loss, but the industry remains strong and relevant as it adapts and adopts evolving technology.