Gazette opinion: Workforce key to Montana’s economic growth

2013-09-15T00:00:00Z Gazette opinion: Workforce key to Montana’s economic growth The Billings Gazette
September 15, 2013 12:00 am

When 3,000 people gather in Butte on Monday and Tuesday to talk up Montana business with the CEOs of some of America’s largest and fastest-growing corporations, they will be starting at a better point than many other states. The Sixth Economic Development Summit organized by U.S. Sen. Max Baucus takes place in a state with lower unemployment and higher income growth than the national average.

But Montana also remains a place with lower-than-average wages and double-digit unemployment on our Indian reservations. Montana has the highest proportion of workers over age 65 of any state. Our worker productivity ranks low relative to worker education levels.

Those highlights and challenges are outlined in the 2013 Labor Day report recently issued by Gov. Steve Bullock and Labor and Industry Commissioner Pam Bucy.

The good news included:

 Montana added 10,700 jobs in 2012, a growth rate of 2.3 percent, outpacing the national average.

 Private sector wages rose 4.2 percent last year, the second fastest rate of any state.

 96 percent of Montana’s labor force has a high school diploma, the fourth highest percentage among the states.

“Montana is in a position of strength,” Bullock said, adding that new efforts this year will build economic strength as the state invests in education and infrastructure while streamlining government.

The health care sector in Montana continued to add jobs during the recession and outpaced every other sector in job growth last year. Health care jobs pay better than the private sector average. The second highest job growth last year was in trade and transportation, followed by leisure activities, then mining and utilities. Government was the only sector that cut jobs in 2012.

Last year, Eastern Montana had the lowest regional unemployment rate (4.2 percent), followed by 4.9 percent in the Billings region and 5.5 percent in the Bozeman region. However, unemployment ran 25 percent on the Crow Reservation, 16 percent on the Northern Cheyenne Reservation and 9 percent on the Fort Peck Reservation.

Last year, the Billings region added nearly 3,000 jobs while Eastern Montana added 1,800.

“The working age population is expected to flatten out in the next decade, resulting in tight labor markets in the future,” the jobs report said.

The state’s working-age population (15-64) will level off after 2015 through 2030, according to population projections from the Census and Economic Information Center at the Montana Department of Commerce.

One way to supplement the stagnating growth of Montana’s workforce is to increase participation. Montana now has about 64 percent of its working-age population working, according to the state report. That’s a lower rate than the nation and lower than our neighbors North Dakota (72.6 percent), South Dakota and Wyoming (both about 69 percent).

The report says Montana workers will need to become more productive so economic growth continues despite a tightening labor market. Montana has a relatively well educated workforce, a factor associated with higher productivity. However, productivity also depends on technology, larger business size, faster transfer of best practices between businesses, better matching of workers to the right job and business investment in the tools and tech that help workers do their jobs more efficiently.

The speakers list at Baucus’ Butte summit reads like a who’s who in corporate leadership: Boeing President and CEO Jim McNerney, Delta CEO Richard Anderson, FedEx founder and CEO Fred Smith, Google Executive Chairman Eric Schmidt, ConocoPhillips CEO Ryan Lance, Oracle President and CFO Safra Catz.

Montana needs to tap into the best ideas of the summit visitors and the best ideas of local entrepreneurs. Our state has the human resources to grow our economy while citizens enjoy a high quality of life, clean air, clean water and the spectacular lands of the Last, Best Place. Now we need business plans that will help more of us achieve that goal.

Copyright 2015 The Billings Gazette. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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