Author: Press Room

Montana Highlights October 1 2023

4 October 2023
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Ten years after opening its first North American store, Fjällräven, the Swedish-heritage outdoor gear retailer opened its first store in Montana, in Bozeman. Fjällräven (pronounced Fyall-rev-en) offers hiking and camping gear. Before 2020, Fjällräven was primarily known in North America for its popular Kånken backpacks.  

The Mexican family restaurant, Rio Sabinas, located at Shiloh Crossing, closed their doors for good September 24.

Montana State University’s fall student enrollment is the largest in its 130-year history, with 16,978 students pursuing the many benefits of higher education at the state’s largest university. The new enrollment is up 2% over last fall’s headcount, an increase of 290 students. MSU’s previous enrollment record of 16,902 was set in the fall of 2018. MSU’s enrollment solidifies its position as the largest university in the four-state region of Montana, Wyoming and the Dakotas.

The Gallatin County residential real estate market saw continued strong demand in August.  According to statistics median sales prices in the single-family market increased 7.6% compared to last August, from $775,000 to $834,000. Closed sales fell slightly by 1.9%, from 107 to 105. The median number of days homes spent on the market decreased 41.7%, from 36 to 21 days. The average percent of list price received ticked up slightly by 0.7%, from 97.4 % to 98.1%. The median price per square foot sold increased 1.9%, from $373 to $380. Pending sales increased 1%, from 103 to 104. The number of new listings increased 11.8%, from 144 to 161. End-of-month inventory decreased 11.9%, from 413 to 364. The month’s supply of inventory fell 10.2%, from 3.86 to 3.47 months.

The Montana Chamber of Commerce has warned, “If a government shutdown does occur, it is likely to be significant in duration with no clear path for reopening the government.”

The U.S. Department of Transportation has announced that Cape Air will continue to provide Essential Air Service (EAS) from Billings to five communities in eastern Montana, which include Havre, Glasgow, Glendive, Sidney, and Wolf Point. The new four-year contract runs from January 1, 2024-December 31, 2027. Cape Air will continue to use its 9-passenger Cessna 402, Tecnam P2012 Traveller, and Cessna Caravan to serve the region.

With little private market interest, again tax dollars are subsidizing the installation of electric vehicle charging stations.  Montana State University’s first Level 2 EV charging stations were installed this summer on the west side of American Indian Hall and on the south side of Hyalite residence hall. A third station is slated for installation on the southwest corner of the Brick Breeden Fieldhouse parking lot later this year. MSU Parking Services said EV drivers will be able to access the stations on a first-come, first-served basis and will be charged $3 per hour to park, payable at the charging station. University officials will closely monitor station usage and other factors to determine where to best locate additional chargers in the future. They also will assess whether there is a need to provide chargers for electric bikes.

The U.S. Environmental Protection Agency (EPA) announced the approval of a Climate Vulnerability Assessment (CVA) project for the Smurfit-Stone Mill site in Frenchtown, Montana. CVAs help EPA project managers design Superfund remedies that are resilient in the face of a changing climate, taking drought, severe weather, temperature, wildfire and other factors into account. The site, a former paper and pulp mill located three miles south of Frenchtown, Montana, covers 3,200 acres and is divided into three operable units spanning agricultural lands, the former mill site and parts of the Clark Fork River floodplain. Efforts are currently underway to characterize and understand risks related to prior site activities and waste disposal practices.

Two environmental groups are suing the state of Montana over wolf trapping regulations they say violate federal law by failing to protect grizzly bears from unintentional trapping. At issue are Montana Department of Fish, Wildlife & Parks regulations that allow trapping of wolves in grizzly habitat. Traps set for wolves and other species like coyote and marten can unintentionally trap grizzlies instead. Grizzlies in the Lower 48 states are protected as a threatened species under the Endangered Species Act.

Tamus Gannon and Lisa Gannon, owners of Swan River Gardens in Big Fork  are celegrating their 25th year in business. Swan River Gardens has four greenhouses dedicated to custom growing and another dedicated to deer-resistant plants.

Cynthia Koch, Three Rivers Bank of Montana’s Assistant Controller, has been named the 2023 Montana Independent Bankers Association, Outstanding Young Banker. This award is to recognize young, upcoming leaders in Montana’s banking community.

The BLM Montana-Dakotas State office will wrap up 2023 with a December lease sale in North Dakota. This was the first full year of federal leases offered under regulatory reforms championed by President Joe Biden. There were concerns in the fossil fuel industry ahead of the new rules that tougher leasing standards would discourage interest in low-production areas, like Montana. In June, Montana parcels nominated for a September sale were withdrawn following  concern by an environmental group that the new lease terms were being ignored. Yet lease sales continued .

Montana Economy Continues Strong

4 October 2023
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Amy Watson, State Economist

As of the beginning of September, the Montana economy continues its strong expansion. Employment is at an all-time high, unemployment rates have reached record lows, and economic production continues to grow at a steady pace despite tight labor markets and inflationary headwinds. Extraordinary job growth and accelerated wage growth have strengthen Montana households and supported continued economic expansion throughout the state. Labor market highlights include:

• In 2022, Montana added 20,900 jobs – the most of any year in state history. Montana ranked 8th among states for employment growth in 2022, posting 3.9% growth.

• The unemployment rate fell to a record-low 2.3% the first quarter of 2023, with the number of unemployed Montanans also hitting a record low of nearly 13,000.

• Tight labor market conditions persisted in 2022, with nearly three job openings for every one unemployed person. The state’s aging population and increased retirements has driven long run declines in labor force participation, further exacerbating the state’s workforce shortage. The number of retirees in the state surpassed 200,000 in 2022.

• Record low unemployment rates have increased competition for workers and driven up wages. The average wage for Montana workers rose by over 6% in 2022, the 4th fastest among states. The average wage earned by Montana workers reached $54,525 in 2022. Inflation outpaced wage growth in 2022, resulting in real average wage declines of 1.6%.

• Montana’s labor force has never been larger, with over 575,000 Montanans working or seeking work. Strong wage growth and a significant uptick in in-migration has helped increase the available pool of workers for Montana businesses. Montana ranks 2nd in the nation for the largest percentage of in-migration from 2020 to 2022. Over 40,000 more people moved to the state than left from 2020 to 2022, translating to 3.8% of the Montana’s population. About 65% of people who recently moved to the state are either employed or actively seeking work, which is higher than the labor force participation rate of existing residents.

The strength of Montana’s labor market help support economic growth in the state. Business formation reached a record high, which propelled economic output to new heights. Continued growth in the Montana economy translated to more income for Montana households. Strong household balance sheets helped offset the impact of rising prices, allowing Montanans to continue spending to support the overall economy.

• The Montana economy grew by 1.6% in 2022, as measured by real gross domestic product. The economy contracted slightly during the first two quarters of 2022, as inflation and the conflict in Ukraine were a drag on economic growth. However, growth turned positive in the second half of the year as inflation moderated. The first quarter of 2023 shows continued economic strength, growing by 6% and ranking 5th in the nation for fastest growth.

• Business formation in Montana reached a record high in 2022, with new business applications

exceeding 20,000 in 2022. Montana boasts the 3rd highest rate of business ownership among states.

• Personal income grew by 3.1% in 2022 – ranking Montana 19th in the nation for fastest personal income growth. On a per capita basis, average income rose to $57,719 in 2022 – ranking 29th  highest among states.

• One of the primary headwinds to economic growth in Montana and across the U.S. during 2022 was inflation. Inflation reached a forty-year high of 9.1% in June of 2022. Since then, changes in monetary policy and easing of supply chain bottlenecks have caused inflation to moderate. As of June 2023, inflation has fallen to 3% over-the-year.

• Montana ranks 8th among states for fastest home price appreciation since 2020. The typical home value in Montana averaged $440,000 in the first quarter of 2023, up 51% from three years earlier.

Montana’s economy has shown strong expansion over the last few years. Although rising prices and tight labor markets have dampened economic enthusiasm, Montana’s labor market has continued to grow.

Workers continue to enjoy plentiful opportunities for high-wage jobs and businesses continue to thrive. Through productivity improvements, investments in worker training, and tapping into underutilized labor sources, Montana’s economy will continue to flourish

Montana Colleges Offer Much to Ag Students

4 October 2023
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Montana’s colleges offer research facilities that could benefit the agricultural industry

In a website, vacation1s5.com, states are rated according to which are considered most highly educated. Population numbers seem to impact the outcomes, which leaves Montana is ranked 36th.

The report says, about Montana:

* Population: 1,084,225

* Percentage holding advanced degrees: 10.5%

* Median household income: $55,328

While the state might not be overflowing with a demand for advanced degrees, Montana still offers a lot to students. There are nearly a dozen higher education establishments here, with Montana State University apparently the best of the bunch. While it ranks 263rd on US News’ list, it reportedly boasts a ton of unique research facilities.

As might be expected of a state that highly favors agriculture, these facilities also focus around this industry. They include things like the Plant Growth Center and the Center for Bison and Wildlife Health. While advanced degrees aren’t always a necessity in Montana, having one in this field can still prove beneficial to help push the industry forward.

Montana is so suited to farming that advanced degrees are less of a necessity.

When it comes to population figures, some states rank much higher than others. Montana is one part of the United States that doesn’t fare highly in this regard. Only a handful of states have a smaller population than this western state. Why is this? Well, the prominence of agriculture might have something to do with it.

This industry has had the biggest impact on the state’s economy for centuries, with the land perfectly suited to farming. Again, this might explain why Montana doesn’t rank amongst the most educated states in the US. With its biggest industry not typically requiring advanced degrees, it makes sense that only 10.5% of the population holds one.

With 20.3% of the population holding advanced degrees, Massachusetts ranks at the top of the list for most educated.

Montana Chamber to Hold Annual Meeting in?Billings

4 October 2023
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The Montana Chamber of Commerce will hold its annual membership meeting in Billings on October 24, beginning at 3 pm, at the Northern Hotel. It will feature presenters from Governor Gianforte’s administration and Moore Information Group, a public opinion research firm.

Evan Wilson, Moore Information Group Vice President, will speak on “Tax Outlook: A Montana Perspective.”

Billings businesswoman, Courtney Kibblewhite is the Montana Chamber Chairperson. Todd O’Hair, Montana Chamber President & CEO, will discuss goals and interim priorities.

The conference will focus on the prospects for Montana’s economy and the roll of the Montana Chamber’s Envision goals.

Outstanding achievers in the state’s business world will be recognized during the Titans of Business Oro Y Plata Awards Ceremony at 5:15 pm.

A networking reception will be held at 5:45 pm—7:00 pm.

Lattice Materials

4 October 2023
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Lattice Materials in Bozeman has announced a new general manager, Travis Wood.

Lattice Materials provides custom-grown and machined silicon and germanium materials, serving top defense, technology, security, research and renewable energy companies.  

Lattice is one of the only U.S.-based companies in the world capable of custom-growing optical silicon and germanium crystals, which gives them tremendous opportunity to bring economic growth to the region, especially considering recent reshoring trends and new germanium export restrictions from China.  

Given this pivotal moment in the industry and Wood’s background in growing and scaling businesses, it is an opportune time to bring Wood on as General Manager to utilize his expertise to scale Lattice’s operations, according to company officials. According to Scott Bekemeyer, TPC co-chairman and founder, a partner company of Lattice, Wood “comes to Lattice with 20 years of experience growing and scaling advanced manufacturing companies. He has a deep understanding of the industries that Lattice currently serves, including aerospace, defense, electric power, and electronics.”

“Travis joins Lattice Materials at an opportune time in the industry when there is a growing demand for the specialized manufacturing solutions that Lattice provides,” remarked Bekemeyer. “Under his leadership, Lattice will continue to grow as a world leader in providing mission-critical solutions to help solve pain points in the defense and broader commercial industries.”

Largest Defense Contractor in Montana

4 October 2023
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By Samuel Stebbins, The Center Square

The U.S. defense budget topped $850 billion in fiscal 2022, more than the combined military spending of the next 10 countries combined. This money goes to fund a wide range of obligations, from operations to payroll for troops and civilian defense personnel. The bulk of the U.S. military budget, however, is spent on contracts with companies in the private sector.

The Defense Department does more business through private contracts than all other federal agencies combined. The Pentagon relies on contractors for services including research and development, weapon systems procurement, facility maintenance, and equipment repair. Outsourcing to third parties in the private sector allows the government to more rapidly and effectively adapt to changing circumstances and needs – though reliance on contractors also raises the potential for waste, fraud, and abuse.

The latest available government data shows that the Pentagon spent $246.8 million on private sector contracts in Montana in 2021. No company in the state received more federal defense dollars that year than S & K Technologies, which brought in $65.7 million in military contracts – or 26.6% of all contractor spending in the state.

Other major defense contractors operating in Montana include Confederated Salish and Kootenai Tribes, James Talcott Construction, Inc., and T & L Sales, which received $25.1 million, $13.7 million, and $12.4 million, respectively, in 2021.

Joins Stockman Bank

4 October 2023
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Teresa Gilreath has recently joined Stockman Bank as a Real Estate Loan Officer at the Billings Heights location. She will develop and originate real estate loans while assisting clients in home purchase financing, consolidating debt, lowering monthly payments, construction financing or utilizing their home as an investment tool. Gilreath brings over 39 years of banking experience to the position, which includes 22 years in the mortgage banking industry. Her vast expertise will assist Stockman Bank in deepening client relationships and expanding our real estate loan portfolio.  She has been active in the community and will continue by participating in Stockman Bank related events.

Fewer Using Credit Cards, But Debt at Record High

4 October 2023
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More than a fourth – -27.1 percent – of Montana households do not use credit cards.

Three percent of Montana households are “unbanked”. They do not have credit cards, checking accounts or savings accounts. Another 11.5 percent utilize alternatives to banks and are categorized as “underbanked”, according to Upgraded Points, a consumer information center for travelers. The national average of households without credit cards is 28.5 percent.

Underbanked are households with a checking or savings bank account but who also relied on check cashing, money orders, international remittances, payday loans, rent-to-own services, pawn shop loans, etc.

Nationally, the share of households that are unbanked is 4.5 percent; and those underbanked is 14.1 percent.

Upgraded Points calculated the share of households that do not possess any Visa, Mastercard, American Express, or Discover credit cards in the past 12 months. The report estimates that 123,847 households in Montana do not use credit cards. As a ratio to the population, Montana ranks 25th among states as to households without credit cards, based upon the rejection rate by banks because they lack a credit record or are credit unworthy.

While the available credit to American consumers has reportedly declined, credit card indebtedness reached a record in the second quarter this year at $1.03 trillion, according to the New York Federal Reserve Bank. Total household debt exceeds $17 trillion, with 72.4 percent of that coming from mortgages and home equity lines of credit.

Credit card balances increased by $45 billion, from $986 billion in the first quarter of 2023 to a series high of $1.03 trillion in the Q2 2023, marking a 4.6 percent quarterly increase. Credit card accounts expanded by 5.48 million to 578.35 million. Aggregate limits on credit card accounts increased by $9 billion and now stand at $4.6 trillion.

Montana ranks 43rd in terms of the average debt per credit card holder at $6,160, according to scholaroo.com. Among cardholders with unpaid balances, the national average for card debt stands at $7,227. According to TransUnion millennials have become record setters as to who is behind on credit card payments since the start of the pandemic.

Connecticut residents bear the highest average debt of $9,408, surpassing the national average by 30 percent. Following closely are credit card debtors in New York, holding the second position with an average debt of $9,165. Kentucky has the lowest average credit card debt, with debtors owing just $5,408.

Upgraded Points explains the increased rejection of applicants for credit cards placing much of the reason on inflation and increased interest rates. Banks can respond to these constraints in several ways. Often, they simply pass on higher interest rates to consumers. But in many cases, the banks may also get choosier about issuing credit, whether by limiting how much they lend out or raising the standards for borrowers to get approved. This increased scrutiny can be felt across all lending products, from bank and vehicle loans, to consumer credit cards “that many Americans rely on every day.”

In this environment, more people’s credit card applications are being denied. The rejection rate for credit card applications as of June 2023 sits at 22 percent, one of the highest rates in a decade. After falling to a low of 10 percent in February 2020, the rejection rate spiked to 26 percent in just one year. Credit card rejection rates fell briefly in 2021 but have risen steadily over the last year.

Big-picture economic trends can certainly affect how likely a credit card application is to be approved, but credit card companies are also always looking at factors specific to each application when making an approval decision. Common reasons for rejection include low credit scores, high levels of debt, a history of late payments or bankruptcy, and insufficient income. But the biggest obstacle for many applicants is a “chicken or the egg” dilemma: it’s harder for someone to get approved for credit if they don’t already have a credit history, reports Upgraded Points.

Existing-Home Sales Decreased 0.7%

4 October 2023
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Existing-home sales moved lower in August, according to the National Association of Realtors. Among the four major U.S. regions, sales improved in the Midwest, were unchanged in the Northeast, and slipped in the South and West. All four regions recorded year-over-year sales declines.

Highlights reported by the association include:

* Existing-home sales retreated 0.7% in August to a seasonally adjusted annual rate of 4.04 million. Sales dropped 15.3% from one year ago.

* The median existing-home sales price climbed 3.9% from one year ago to $407,100 – the third consecutive month the median sales price surpassed $400,000.

* The inventory of unsold existing homes dipped 0.9% from the prior month to 1.1 million at the end of August, or the equivalent of 3.3 months’ supply at the current monthly sales pace.

“Home sales have been stable for several months, neither rising nor falling in any meaningful way,” said NAR Chief Economist Lawrence Yun. “Mortgage rate changes will have a big impact over the short run, while job gains will have a steady, positive impact over the long run. The South had a lighter decline in sales from a year ago due to greater regional job growth since coming out of the pandemic lockdown.”

“Home prices continue to march higher despite lower home sales,” Yun said. “Supply needs to essentially double to moderate home price gains.”

Entrepreneurship on Rise; Reaches Highest Level

4 October 2023
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Following the pandemic when thousands of businesses were forcibly closed and many failed, leaving people unemployed and facing big changes in their lives, an unprecedented number launched their own businesses escalating the rate of entrepreneurship.

According to the Washington Post nearly 1 in 5 adults — 19 percent — are in the process of founding a business or have done so in the past 3 and a half years, based on data from the Global Entrepreneurship Monitor, recently released by Babson College. That is the highest level since the survey began in 1999.

In Montana, with more than 30,000 new businesses registered to date in 2023, the state appears to be on pace to have another record year of new business registration. New business registrations in Montana surged in June 2023 with roughly 5,300 new businesses registered with the Secretary of State’s Office, easily surpassing the approximately 4,300 new registrations in June of 2022.

The Montana Business Economic Report revealed 51,508 new businesses registered in 2021, surpassing the 2020 total by more than 12,000. In 2022 the state had record growth with some 53,000 businesses registering.

“We’re seeing an upward trend in entrepreneurship that’s continued through the pandemic, and that’s a really great sign,” said Donna Kelley, a professor at Babson College and the report’s lead author. “It means businesses are introducing innovation, creating jobs and contributing to the competitiveness of the United States.”

Globally, the United States had the third-highest entrepreneurship rate among 21 high-income economies, lagging behind the United Arab Emirates and Saudi Arabia, but ahead of Canada and the United Kingdom, researchers found.

Applications for new businesses spiked to an all-time high in July 2020, when more than 550,000 Americans filed paperwork to start their own companies. A boost in government funding — in the form of stimulus checks, extra unemployment benefits and small-business loans — gave many people the financial cushion to get started.

Since then, business registrations have remained well above pre-pandemic levels.

But also being reported is that many small businesses founded in recent years are struggling due to economic uncertainty, higher costs and a slowdown in consumer spending. Business closures ticked up last year, to 5.2 percent from 2.9 percent in 2019.

Adults between the ages of 18 and 34 were nearly twice as likely to start businesses as those between 35 and 64. And although men are still slightly more likely than women to start their own companies, that gap continues to narrow. There was also a clear shift away from service industries, such as finance and real estate, toward manufacturing and logistics.