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The Private Sector: More Than a Job Creator

A column by Tanya Fiddler about the private sector and job creation.

Jobs, jobs, jobs. They're on everyone’s mind these days, and Creator knows our reservations are in dire need of jobs. While America has experienced a lingering unemployment rate around the 9th percentile for the past couple of years, our reservations have been enduring unemployment rates much higher than that – sometimes up to 90 percent – for generations. The simple fact is, the quantity of jobs we need to sustain our reservation populations just don’t exist. Since many reservations are located in isolated rural areas, commuting off-reservation isn’t a viable option either. So, how do we go about creating jobs for our Native people?

Some tribes focus on establishing tribal enterprises to create employment opportunities. While these enterprises do bring a steady stream of income to our Native families, they are not creating an opportunity for us to break free from reliance on a governing body, whether the federal government or tribal government. When we depend solely on BIG Government as our source of independence, we are living in a false sense of autonomy because we are still allowing some other entity to provide our options for us. I believe that tribal enterprises have a place in Native economies, but in order to create strong self-reliant tribes, we also need to focus on developing private sectors on our reservations.

A private sector allows tribal government to focus on developing infrastructure. In general, reservations lack adequate road, water, sewage, electric, and telecommunications systems to support safe and healthy living for our residents and to foster commercial development. A focus on developing private sector would create a very desirable ripple effect to fill this need. Private sector creates revenue for tribal government with tax compacts. In turn, tribal government uses these resources for infrastructure development. With better systems in place, our communities become more attractive locations for aspiring Native entrepreneurs. More businesses set up shop, creating more jobs and revenue for tribal government. A pattern of growth and development continues to repeat itself, ultimately creating a stronger, more diverse economy on our reservations.

A private sector encourages top quality products and services. An economy consisting only of tribal enterprises eliminates competitors in the local marketplace. Without competition, businesses have no incentive to provide excellent customer service, the best prices, or the newest and greatest products. Consumers’ options are greatly limited, but free markets invite a competitive spirit and inspire new and better innovations all the time. This kind of environment encourages entrepreneurs and businesses to continually grow and develop, and our local consumers get the best products and services possible.

A private sector fosters business-to-business development. A recent survey of 111 local institutions, organizations, and businesses on the Cheyenne River Reservation revealed that respondents spend just over half of their budget outside of the reservation. Private sector development can eliminate this “leaky economy syndrome” and create jobs. For example, in the study I just cited, we found that survey respondents purchased a total of $177,510 per year in office supplies from local vendors. However, they also spent $292,772 off the reservation. That amount in off-reservation sales could easily support an office supply business in our community.

A private sector creates an environment of limitless options. A private sector enables Native entrepreneurs to act on their passion and explore innovative business ideas. One of Four Bands Community Fund’s youth clients, has been successfully growing his lawn care business on the Cheyenne River Reservation in South Dakota since he was seven years old. He just graduated from high school and is planning on attending college. In addition, he would like to travel around to other reservation high schools to tell his story and encourage students to follow their entrepreneurial dreams. He is also talking about using his business to create job opportunities in other communities. An entrepreneur functioning in an economy with a private sector has the opportunity to reach unimaginable heights. Our people deserve to have that option.

Native community development financial institutions (CDFIs) are proven vehicles in revitalizing Native reservation economies, creating jobs, and developing a private sector. South Dakota’s reservation counties with operating Native CDFIs have experienced significant growth over the last decade. Specifically, on the Cheyenne River Indian Reservation where Four Bands operates, median income grew 51% and employment increased by 20% from 2000 to 2009. The neighboring Pine Ridge Reservation, where Lakota Funds (another Native CDFI) has been operating for over 20 years, saw similar results. Native CDFIs have many stories like the one about the youth client I just shared.

We don’t just need jobs to strengthen our Native economies – jobs are just the numbers we see. It is the Native entrepreneurs, full of hope and passion and desire, that are behind the job creation driving economic development. The private sector not only perpetuates job creation on several different levels, it acts as an agent of empowerment for our individual tribal members and nurtures the entrepreneurial spirit. After all, tribes can only be as strong as their tribal citizenry.

Tanya Fiddler, a Cheyenne River Sioux tribal member, is the executive director of Four Bands Community Fund and the founding co-chair of the Native CDFI Network.