Montana's Cities and Regions: Gallatin County Economy Now States Second Largest.

AuthorBarkey, Patrick M.

Rome wasn't built in a day, it is said. But residents of Gallatin County might be forgiven if they sometimes feel that each day's passing brings on growth that is visible--a new building shell, a new store opening or a new traffic light. Since recovering the ground it lost in the Great Recession in 2012, the region has grown to become the second largest economy in the state.

Given that the previous No. 2, Missoula County, hasn't exactly been standing still in that same interval of time, that is quite an accomplishment. Since 2007, Missoula's economy has grown by about 24 percent, roughly in line with Yellowstone County (Billings) and slightly faster than Flathead County (Kalispell). Growth in Gallatin County over this same period has been more than 47 percent, almost double what the state s other two largest cities have registered.

Factors Driving Regional Growth

One of the oldest questions in regional economics is understanding what drives growth. Do cities and regions grow because the industries that they specialize in are thriving? Or do they grow by attracting talent and investment that grows the businesses those talented people bring with them? Montana's economies feature a little of both.

Agriculture, natural resources, mining and tourism industries are important drivers, to one degree or another, of the local economies around the state. The stabilization and gradual rise of oil prices has helped end the free fall of oil patch counties on Montana's eastern border, just as the heavy visitor volumes at our national parks have given a push to the economies of the nearby urban areas.

But there is also a robust inflow of new residents to many Montana communities--especially in the West--that has invigorated the construction sectors of those areas. Flathead and especially Gallatin counties have a higher concentration of construction employment and earnings than the rest of the state. In the past two years, Missoula, Ravalli and Madison counties, among others, have also seen healthy in-migration and new construction focused on residential and commercial markets.

Growth Around the State

Data on economic activity in Montana's counties and regions through the midpoint of calendar year 2019 reveal some changes to the three-year-old pattern of western growth and eastern challenges within the state. Western urban areas continue to grow, with growth extending across the border to neighboring counties. But growth in Billings has resumed as well. And...

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