Economists Predict Rebound In Montana Followed By Hangover
While the COVID-19 pandemic cratered Montana’s economy last spring, researchers say the state’s recovery has been a little stronger than the U.S. average.
Patrick Barkey, director of the Bureau of Business and Economic Research, says Montanans lost 39,000 jobs from January through June last year. Accommodations and food, and arts and entertainment were the two industries hardest hit by the COVID-19 pandemic.
Barkey says it’s been a painful recession for many Montanans but overall, “it’s more of a jobs recession than an income recession for Montana."
Speaking at BBER’s annual economic outlook seminar, which is being held virtually this year, Barkey says a flood of government money came into Montana last year through unemployment benefits, Paycheck Protection Program loans, stimulus checks and other financial assistance.
“We’ve been on a government life support system. I mean, there is enormous amount of cash, and Montanans in particular aren’t really aware of the CARES Act disbursements that were made to state government were even more favorable to Montana than other states because it was on a per capita basis but there was a minimum floor,” Barkey says.
Barkey says more people were saving money, and certain industries, like mining, high-tech and even tourism to some extent, continued to do well during the pandemic. He says wage and salary growth last year was almost where it was the year prior.
While data is still coming in from the last quarter of 2020, Barkey is predicting results will show a mild uptick in personal income in Montana.
Barkey says BBER is forecasting a growth rebound in 2021 followed by a hangover with slower growth in later years.
“I think the pandemic is the wildcard. I think the expectation is we are going to get back to normalcy, whatever that means, exactly, some time around July. We keep pushing that back, but we’re hopeful,” Barkey says.
Barkey says he predicts hard times ahead for coal and oil, a brighter future for agriculture, continued growth in the high-tech sector and high housing demand.