Inflation and new residents play big role in state's economy according to report

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Posted at 5:18 PM, Jan 25, 2023

HELENA — For 48 years, the Bureau of Business and Economic Research has traveled around Montana to share their findings in their annual economic outlook seminar. On Wednesday, the group presented their findings in Helena.

Helena was second out of the nine stops the Bureau of Business and Economic Research has on their annual tour across the state.

A major focus this year is an issue that is not unique to Montana.

"Inflation has been no kinder to Montana than any place else," said BBER Director Patrick Barkey, "In fact, you could argue that's even been a little worse here because we're a state that uses more energy and we're also a state that's experienced higher than average housing price growth."

Barkey talked about efforts by the Federal Reserve to slow inflation by raising interest rates, thus making money cost more to borrow, and potentially decreasing demand for some goods.

"Right now, we're in an economy that's fighting very hard to control inflation, where an economy has rising interest rates or an economy that has a cooling in consumer demand and an economy that is really going into a more restrictive part of the growth cycle," said Barkey.

Another key issue is the continued surge of new residents into the state.

Something that has driven up home prices and rents, the statewide average price for a home is up 54% from before the pandemic.

Something keynote speaker Bryce Ward, an urban and regional economist, says the state said Montana wasn't prepared for that.

"It's not just that we have more people. We also have different people. You know, 22% of the workers who migrated in in 20-2021 work from home, 45% of people over 20 had college degrees. 13% of households had income over $200,000, which is much, much higher than we're used to seeing for any of those things," said Ward.

Ward adds that the state is expected to see continued strong tourism as a key economic driver.

"You know, tourism is a big you know, we bring in 12 million visitors a year. So it's and it's been at that rough level for a long time. So it's part of our economy. We have businesses, we have hotels, we have capacity that's designed to absorb at least some level of that," said Ward.

Their next stop for their economic outlook seminar will be in Missoula. Here's the rest of the schedule:

Missoula – Friday, Jan. 27, at the Hilton Garden Inn

Billings – Tuesday, Jan. 31, at the Northern Hotel

Bozeman – Wednesday, Feb. 1, at the Commons

Butte – Thursday, Feb. 2, at the NorthWestern General Office

Kalispell – Tuesday, Feb. 7, at the Hilton Garden Inn

Sidney – Tuesday, March 14, at the MSU Richland County Extension Office

Miles City - Wednesday, March 15, at the Sleep Inn & Suites