Hill County economic growth expected for near future

Watch for more on the economic seminar in upcoming editions of Havre Daily News.

An economist said Wednesday he expects Hill County to continue to see a little higher growth for a couple more years than the trend has been as recovery from the pandemic continues.

Bureau of Business and Economic Research Executive Director Patrick Barkey said Wednesday that this region has seen a little less robust recovery in some economic sectors from the pandemic than some other parts of the state, but it also saw less of a loss early in the pandemic than some areas.

That stronger-than-trend growth should continue for a while, he said.

"Those numbers are not eyepopping, but those are numbers as we see it for from our seat," he said " ... So far, this forecast looks like it's on track, but there are lots of challenges ahead as well as opportunities."

Barkey was speaking at the bureau's Economic Outlook Seminar 2022, the last one of this year's tour, at Hensler Auditorium in Montana State University-Northern's Applied Technology Center.

He said the area was hit in most sectors by the pandemic, although wages remained strong - likely because many jobs worked longer hours, and the areas that were hit tended to be in lower-wage sectors.

He said personal income - basically people's spending power - showed a fairly healthy growth in 2021, adding that that is the federal stimulus payments.

He said the area saw strong growth coming out of the closures, as was expected, but that growth will taper off without the stimulus and with economies staying open.

"You can only reopen once," he said

Bear Paw Development Corp. Executive Director Paul Tuss said several issues have hit the region, and several more major concerns are arising, but some factors also have helped.

Tuss also is a Democratic candidate for the state House of Representatives, facing Rep. Ed Hill, R-Havre, in the fall general election.

One problem, Tuss said, was the loss of Canadian traffic due to the pandemic and the border closures.

Tuss said a Havre Area Chamber of Commerce Survey conducted several years ago showed some local businesses say 50 percent of their bottom line comes from Canadian customers.

Vaccinated Canadians and those with a negative COVID-19 test in the past 72 hours now can cross the border, "so that is good," Tuss said.

But other pandemic issues such as the slow movement of goods and supplies are still hitting, he added. He said one business hoped to be open months ago but is still waiting on shipments.

And he said agriculture is facing problems on a few fronts, including input costs.

Tuss said he was told Tuesday that the cost of chemicals have gone from $32 an acre to $55 an acre, which hits ag producers directly in the pocketbook.

He said Bear Paw also has started seeing more transfers of the ownership of businesses than new startups, which he isn't sure if it is related to the pandemic or not.

But, he said, one of the strengths of the area he and his staff at Bear Paw identified is a strong sense of entrepreneurship, which is common in rural Montana and maybe rural America.

He said if someone takes a trip on Reserve Street in Missoula they will see many chain stores, box stores.

"You're not going to find that in Chinook or Malta or Havre, Montana, what you're going find is a lot of small business owners and entrepreneurs starting their businesses," Tuss said.

He also said he is very curious to see what the impact of the legalization of recreational marijuana will be, noting that the state saw $22.6 million in sales of recreational and medical marijuana in January alone, the first month of recreational marijuana being legal.

"It's going to have an impact," he said "I don't know what kind of an impact, but I don't think that we can ignore that, and I'm curious."

He said the American Rescue Plan Act funds also had a major impact in the area, with much more coming for infrastructure. He said Bear Paw works with local governments every day on issues like water and wastewater treatment, and the $100 million appropriated for repair of the St. Mary Diversion that supplies much of the water in the Milk River each year also will be huge.

He said the attention to remote working brought on by the pandemic also could be benefit.

"We think that this is a big opportunity," he said, adding that he knows a couple who work in Havre remotely for a company in Atlanta, which is bringing good incomes into Havre.

"We need to open that up for discussion," he said.

In response to a comment from the audience about remote work being a double-edged sword, he agreed, but said it has opened the eyes of some employers who only believed in employees being in the office doing their work.

"I was one of those people," Tuss added,

He said Bear Paw now has an employee working remotely from Malta and another who works from home one day a week.

"We haven't missed a beat," he said.