Good Economic News Still Challenging for Montana Employers

In another positive report for Montana's economy this week, the Treasure State just passed a major jobs milestone, marking the 24th month when the state's unemployment rate remained below 3%.

The latest statistics from Helena show Montana's unemployment rate at 2.8% in November, continuing below the national average which was 3.9% in October.

And while the rate and the corresponding job growth is encouraging, especially for job-seekers, it also presents a continuing challenge for employers who may be having a hard time filling openings.

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Governor Greg Gianforte announced the record-setting unemployment mark this week, noting that in years past Montana's unemployment rate had only fallen below 3% three times since record-keeping started half a century ago.

“Montana has seen two straight years of unemployment below 3%, shattering previous records,” Gov. Gianforte said. “With hardworking Montanans in mind, we’ll continue to cut red tape, lower taxes, and invest in a stronger workforce to make Montana an even better place to live, work, start a business, and raise a family.”

By comparison, the U.S. Bureau of Labor Statistics that ten years ago, in November 2013, Montana's jobless rate was 5.1%, dropping from the 2008 recessionary high in January 2010 of 7.5%. Montana's highest unemployment in recent years happened in April 2020, during the height of the initial pandemic, when the statewide average was 11.9%.

Job creation numbers

The state reports payroll jobs, as opposed to contract and other freelance work, climbed by 1,600 jobs in October. Interestingly, the largest growth was in the leisure and hospitality industries, which doesn't directly reflect the problems we've been saying in places like Missoula, where there's been a spate of restaurant closures this year.

It's also noted that total employment, which includes payroll, agricultural and self-employed workers "dropped slightly". However, the Governor's Office points out that Montana has added 40,000 jobs over the past two years, with 9,000 of those coming since January.

While finding people willing to work has impacted many employers, the Montana Department of Labor and Industries reported in September that most newcomers to Montana were getting jobs in food service and retail trade.

Montana employment is strong, but trailing other states in the region

While those numbers are robust, Montana's payroll employment growth continues to trail other Northwest states. The Bureau of Business and Economic Research at the University of Montana reported Montana's growth in that category was 1.2% through August. Washington, Idaho, and Wyoming jumped by 2.3% to 2.7%, while Oregon grew 2.0% in payroll jobs.

BBER also has tracked that the strongest job growth had remained in Western Montana counties through the end of 2022, in addition to places like the Gallatin, Yellowstone, Custer, Richland, and Hill counties.

Paychecks not buying as much

The state reported the Consumer Price Index for All Urban Consumers, or CPI-U remained flat in October as Montanans continue to wrestle with inflation. Housing costs continued to drive the burden, climbing in October and offsetting a drop in gasoline prices. The "all-items" index, which includes food and energy was up 3/2% in the 12 months ending in October. "Core inflation", which doesn't include food and energy, is up 4% for the year.