SIOUX FALLS - South Dakota's economy likely will see a slowdown in job growth and personal income next year before things pick up in 2009, an economist told business leaders here.

Overall, the state's economy in 2008 won't take a huge hit from a nationwide economic slowdown partly spurred by a subprime lending crisis, said Ralph Brown, professor emeritus of economics for the University of South Dakota.

"The South Dakota economy is still growing at a pretty good pace, while the U.S. economy is slowing," he said Tuesday at a seminar for members of the South Dakota Chamber of Commerce.

The farm, manufacturing, health care and service sectors of the economy will remain strong in 2008. But the consumer sector will slow, Brown said.

He predicts the state will see 1.8 percent growth in nonfarm employment in 2008, compared with the 2.3 percent seen so far this year. Economists predict the nation will experience 0.8 percent job growth in 2008.

"A 1.8 percent growth rate is still not that bad," he said. "It's a slowdown but no recession."

South Dakotans also will see a slight dip in nonfarm personal income growth, Brown said. He forecast a 3.3 percent increase, compared with a 3.5 percent increase this year.

Looking toward 2009, Brown forecast an uptick in income growth and employment. The state should see a 2 percent growth in nonfarm jobs, and a 3.5 percent increase in personal income.

Much of the seminar's focus was on growing South Dakota's economy and the continuing challenges to recruiting and retaining the state's changing work force.

David Chicoine, president of South Dakota State University, said South Dakota needs to change its universities from just halls of learning into innovative knowledge and research hubs.

It's an expensive proposition that will pay untold future dividends, he said.

"We have to build expertise; we have to invest in people," Chicoine said. "We have to create enabling facilities."