By Eric Dietrich,
Montana Free Press
California, Washington and Colorado are the top states of origin for people who moved to Montana in 2020, the first year of the COVID-19 pandemic, according to tax filing data presented to a legislative interim committee this week.
The study, produced by the Legislative Fiscal Division in an effort to understand how migration patterns will affect the state’s long-term tax revenues, provides some of the first-available hard data on pandemic-era migration trends. Widespread anecdotal evidence already indicates that the pandemic and a subsequent shift toward remote work has brought waves of new arrivals to Montana, bolstering local economies and driving up housing prices across the state.
The fiscal analyst who prepared the study, Sam Schaefer, also used the tax form data to identify where in the state new taxpayers are moving and compare the incomes of new and existing Montanans.
In total, partial-year residents moving into Montana filed 18,077 state tax forms, compared to 11,416 forms filed by residents who left the state over the course of the year — a net gain of 6,661 filers. Because many taxpayers file on behalf of other people in their household, that figure is probably lower than the total number of people who moved into Montana in 2020.
Citing non-tax-filing data, the report says Montana’s population grew by 1.1% overall in 2020 and is thought to have accelerated to “extremely strong” 1.6% population growth in 2021.
The tax data study’s key takeaways include the following:
MOST NEW MONTANANS ARE COMING FROM THE WEST COAST AND COLORADO-
Of Montana’s new tax filers in 2020, the greatest share, about 2,500, came from California. Washington and Colorado were also major states of origin, followed by Oregon and other states in the western U.S. Montanans who moved out of state were most likely to head to Washington, followed by Idaho and Arizona.
SOUTHWEST AND NORTHWEST MONTANA ARE SEEING THE MOST IN-MIGRATION ON A PERCENTAGE BASIS –Montana’s urban centers — counties encompassing Bozeman, Kalispell, Missoula, Billings and Helena — saw the most in-migration in terms of absolute numbers in 2020.
On a percentage basis, however, the picture is slightly different. Gallatin County, including Bozeman, ranked highest in the state with 5.2% growth in tax filings in 2020. Behind it were Madison County, including Ennis and the Yellowstone Club (4.8% growth), and Flathead County, which includes Kalispell and Whitefish (4.5% growth).
Several rural counties in northwest Montana saw high growth rates as well: Sanders (4.4%), Lincoln (4.3%) and Mineral (4.3%). Those northwest Montana counties also stood out as the top-ranked counties in the state for growth specific to taxpayers over the age of 65.
AT LEAST SOME NEW ARRIVALS ARE HIGH EARNERS – The amount of wealth flowing into Montana with new arrivals has been a particular point of concern in discussions about pandemic migration, particularly among residents worried about income inequality and new arrivals outbidding existing residents for limited housing supplies.
The study indicates new arrivals in 2020 had significantly higher incomes on average than existing Montana residents: about $110,000 for new arrivals versus about $82,000 for current residents.
In contrast, the median income for new arrivals, $42,557, was lower than the median for current residents, a statistical quirk that indicates the average figures may be skewed upward by high earners. The study says the top 10% of new residents had an average income of about $599,000 — nearly double the average income reported by the equivalent slice of Montana’s highest income earners.
The median income for existing Montana residents in 2020 was about $50,000.
Those figures represent federal adjusted gross income, which includes capital gains and business income in addition to wages, and is sometimes adjusted downward to account for things like retirement contributions or student loan interest.
THERE’S LITTLE EVIDENCE THAT NEW ARRIVALS ARE PAYING A ‘SCENERY TAX’- Montana’s wages, which are comparatively low by national standards, have long been discussed as a sort of “scenery tax” that residents pay in exchange for the pleasure of living amid world-class landscapes. The tax study, however, indicates that may be a thing of the past for new arrivals.
Montana taxpayers who arrived in 2019 and stayed in the state through 2020 typically didn’t see their annual income decrease, the study notes. Instead they saw it increase — by 5% for working-age residents, who earned almost $74,000 on average in 2020.
“They came here and got similar-paying jobs or they brought their jobs with them. It wasn’t a scenario where they took a 10% pay cut to live in Montana,” Schaefer said.
While Montana’s pandemic-era migration trends continued into 2021, similar tax data for last year isn’t currently available because many residents haven’t yet filed their 2021 taxes. Schaefer said this week that he expects 2021 data to be available in late fall.
The full Legislative Fiscal Division study is available at leg.mt.gov/content/publications/fiscal/2023-Interim/March-2022/mara-march-2022.pdf
Montana’s Unemployment Rate Reaches Record Low
Montana’s Unemployment Rate is Fifth Lowest in the Nation
Submitted by Brooke Stroyke, Office of the Governor
Jessica Nelson, Department of Labor and Industry
Governor Greg Gianforte announced on March 14 Montana’s unemployment rate dropped to an all-time low of 2.7% in January 2022, down 0.2% from December’s adjusted rate. Montana’s unemployment rate is the fifth lowest in the nation.
“With lower taxes and responsible, responsive government, Montana is leading an economic comeback, with more Montanans working than ever before and our unemployment rate at its lowest level ever,” Gov. Gianforte said. “Committed to creating greater opportunities in every corner of our state, we’ll continue to invest in developing our workforce and making Montana an even better place to live, work, and raise a family.”
Montana’s unemployment rate of 2.7% for January is well below the unemployment rate for the U.S. of 4.0% in January.
The State of Montana has not only recovered all jobs lost since the start of the pandemic, but also grown beyond that level, with 539,758 Montanans employed in January 2022 compared to 525,909 in March 2020.
Since Governor Gianforte was elected, more than 20,000 Montana jobs have been created.
Montana’s total employment, which includes payroll, agricultural, and self-employed workers, hit another record high in January, rising 2,082 with roughly 1,100 people entering the labor force and 960 fewer people unemployed.
Montana’s labor force was at its highest recorded level in January at 554,986.
On March 2, 2022, the U.S. Bureau of Labor Statistics revised jobs data going back as far as January 2017.
Inflation continues to soar across the country. February’s 7.9% inflation rate was the sharpest spike since 1982.
The rate of inflation, with The Consumer Price Index for All Urban Consumers (CPI-U), increased by 0.6% in January and 0.8% in February. The price increases over the last month were driven by a 6.6% increase in gasoline prices. The index for all items minus food and energy, also called core inflation, increased by 0.6% in January and 0.5% in February, with an 6.4% increase in the year ending in February.
The Farmers Market at Libby Public Vendor Meeting
Submitted by Jule Mason
The 2022 Market Season is approaching! Stop by our public vendor meeting on Thursday, March 31st 5PM at the Gracious Table for information regarding the upcoming market season. This meeting is open to the community; all returning, new, and prospective vendors are encouraged to attend!
If you are as excited for the upcoming 2022 Farmers Market at Libby season as we are, you can pick up a vendor packet at the Libby Chamber of Commerce or download the application online at www.libbychamber.org after February 14th.
More information about the Farmers Market on the Libby Chamber website, www.libbychamber.org/farmersmarketatlibby.
For more information on this topic, please contact Myranda Cravens (406) 293-4167 or email info@libbychamber.org.