Butte's economy 'stable, manageable'

2013-12-22T00:00:00Z Butte's economy 'stable, manageable'By RENATA
BIRKENBUEL Montana Standard
The Billings Gazette
December 22, 2013 12:00 am  • 

BUTTE — Compared to the recent rapid growth in Bozeman and Missoula, Butte maintains an even, manageable economy, which local economists say is more desirable for the city’s economic stability.

Diversity drives a healthy mix of firepower necessary to keep Butte competitive, said John Kasperick, NorthWestern Energy economist, referring to much-needed services in the mining, manufacturing, public utilities, health services, government, education and trade sectors.

“We used to be so mining-dependent, that if prices went down, layoffs would happen and hurt the county bad,” Kasperick said. “Now we have a few layoffs here and there, so we’re able to weather the storm a little bit.”

Montana Resources, which runs the mine in Butte; Renewable Energy Corp., which makes solar and silicon products; NorthWestern Energy; St. James Healthcare and other health services; Butte-Silver Bow County; Montana Tech and Town Pump are among the employers in Butte that provide reliable employment.

Butte-Silver Bow’s 2012 per capita income, $44,641, placed ninth of 56 counties in the state, ahead of Yellowstone (15th at $41,710), Lewis and Clark (16th at $41,098), Cascade (17th at $40,822) and Gallatin counties, according to Kasperick’s data.

Gallatin, home to Bozeman and several high-profile tech firms, had a per capita income of $40,000 for the 20th spot.

Eastern Montana counties like Daniels and Richland, which thrive on the Bakken oilfields or agriculture, barreled to the top eight.

“We’ve never grown like a Gallatin, Ravalli and Flathead,” added Kasperick. “Gallatin was hurt during the recession more than us. Since 2000 we’ve held pretty steady.”

Contrary to perceptions, population in Butte-Silver Bow actually grew steadily between 2000 and 2012 after decades of decline following the Anaconda Company years.

Jim Smitham, who keeps his pulse on the local economy as the Butte Local Development Corp. director, said Butte’s economy grew during the recession while neighboring cities suffered.

For instance, Butte’s housing market is more reasonably priced than neighboring Bozeman.

The median sale price of a single-family residence in Bozeman was $295,000 for the first half of 2013 while the same type of house in Butte sold for $116,378, according to the Multiple Listing Service.

Meanwhile, there are advantages to keeping a level economy devoid of up-and-down fluctuations.

“Are we going to be a grower like Bozeman, Missoula or Helena?,” Smitham asked.

“No, we’re not. Those towns took a hard hit during the recession and it’s taken a while for them to recover.”

During a midyear session summarizing the state of Montana’s economy last summer in Butte, economist Paul Polzin projected only a 2.2-percent growth in nonfarm labor income for 2013-2016 due primarily, he said, to “uncertainty of the worldwide economy.”

Other recent closures in Butte’s service industry include Denny’s Restaurant and 4-B’s Restaurant. In manufacturing, REC announced layoffs in October.

At the time, Polzin reported to local business leaders that earnings were up 5.3 percent in Butte-Silver Bow County — the highest in the state. He referred specifically to bonuses that Montana Resources’ employees received during 2009-2012.

Marko Lucich, executive director of the Butte Chamber of Commerce, reiterated at the mid-year economic meeting last summer, that the county “is going in a positive direction from 2009-2010 to the present time.

“What stands out for me is that we’re showing growth compared to the rest of the state,” he said.

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