CHANGING TIMES CHANGING VALUES

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Recent Population Trends in the Bozeman
Area  Population growth in three-county area
centered around Bozeman is heavily concentrated
in Gallatin County itself. Gallatins population
saw gradual growth in the 80s, increasing from
43,000 to 51,000 people, an increase of 18. The
rate of growth increased significantly in the
early 90s. By 2000 Gallatins population stood
at 68,000 an increase of 34 over the decade.
Growth was fueled by a sharp increase in net
migration.
 

   
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Future Population at Present Rates of Growth
  In percentage terms, Gallatin County grew at
an annual rate of 2 to 3 in the early 80s,
before actually losing population in 1987 and
1988. Growth accelerated in the early 90s to
nearly 4 annual growth in 1992, 1993, and 1994.
The pace of growth then fell back to less than 2
in 1996 before increasing again, rising above a
3 growth rate again more recently. The most
recent estimate places Gallatins population at
75,637 in July, 2004.   Population for the
county is projected into the future at 2.2 to
3.0 a year. At these rates, the countys
population will reach 95,000 to 105,000 people by
2015. The current projection by the National
Planning Association (NPA) for Gallatin is a
population of 86,120 by 2015. However, area
growth is relatively fast and this growth should
continue, although overall growth will largely
hinge upon what happens in area net migration in
future years. Migration patterns are now driving
population trends throughout the western United
States.
 

   
 
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Gallatins Population by Single Ages 1990 vs.
2000   The upper chart shows the population of
Gallatin County in 1990 and ten years later in
2000. Showing population in this way allows one
to see where population change occurred within
age groupings of the population. The lower chart
then shows population change by single age during
the period.   Growth is heavily focused among
persons between their early 40s and late 50s
(baby boomers), as well as among persons in
their teens and early to mid 20s (boomer
echoes).
 

   
 
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The Missoula Co. Pop. in 1990 versus 2000 by
Single Ages
The chart shows population change in Missoula
County by single age for 1990 versus 2000.
Population growth is concentrated among adults at
ages between their early 40s and early 60s, as
well as among older children. Growth among
persons in the early 20s primarily reflects
University of Montana enrollment growth.
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The Flathead Population in 1990 versus 2000 by
Single Ages
The chart below shows where population growth in
the Flathead has been the greatest over the last
decade. Population growth is focused among
adults at ages between their early or mid-40s to
mid-60s. Among the younger population, growth is
focused among the high-school age population, or
persons between 12 and 18.

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Population Change by Single Age in Park and
Madison Counties   Both Park and Madison
Counties are seeing only small population change,
but the composition of the population by age is
shifting. Even without much population change,
there is considerable growth in population of
both counties in their 40s and 50s.
 

   
 
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Trends in the Number of Births in Gallatin Co.
  With the populations of many areas steadily
aging, median ages have risen and birth rates
have fallen. This has tended to slow growth in
many areas and increase the role of net migration
in ultimately determining overall population
trends.   As shown in the top chart the number
of births in most of Montanas more populated
counties have been falling since the mid-80s.
This has resulted in declining elementary school
enrollment in most of these areas, sometimes
resulting in the closure of schools. However,
birth counts have begun to increase in most
counties. In Gallatin, birth numbers have
steadily risen since the mid-90s, after some
earlier declines.
 

   
 
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Changing Age and Income Composition in Gallatin
Co.  With population growth focused among
persons in their 40s and 50s, the median age of
the areas population has gradually increased,
rising from 25 in 1980 to 31 in 2000 in Gallatin,
from 33 to 41 in Park, and from 34 to 43 in
Madison. Areas with aging population tend to
have faster income growth among non-labor sources
investment income and transfer payments.
However, this isnt occurring in Gallatin because
of fast growth in labor earnings.
 

   
     

 
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Overall Employment Trends in Gallatin
County  There are two major categories of
employment wage and salary employment and
proprietor or self-employment. The chart below
shows trends in both of these. Employment growth
accelerated in the early 90s. Wage and salary
employees account for about three-fourths of all
employment. The chart in the upper right shows
employment by private vs public or government.
Employment growth is heavily focused in the
private sector. Private employment accounted for
79 of all non-farm employment in 2000, up from
68 in 1980.
 

 
   
     

 
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Accelerating Growth in Population, Employment,
and Income  While conventional wisdom in many
areas of Montana were that the economy had
slumped in the last decade, in reality, growth in
many areas actually accelerated. In Gallatin
County, population expanded by 34 in the 90s as
compared to 18 in the 80s. Employment growth
increased from 47 in the 80s to 61 in the
90s. And this expansion translated into the
income base of the area growing by more than 70
in inflation-adjusted dollars, as compared to 43
growth in the 80s.   The Bozeman area economy
clearly moved more firmly into a growth mode
during the last decade and this growth is
continuing.
 

 
   
     

 
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Sector Employment Change in Gallatin Co.  There
are 13 major sectors of the economy and
employment trends for each of these are shown in
the upper chart. The services sector is the
largest sector of employment and it has accounted
for much of the areas growth in employment over
the last twenty years. This pattern of
employment change is the same as for Montana as a
whole and for the larger Rocky Mountain West
region.   With its growing prominence, services
now account for about 30 of all area employment,
up from just over 20 in 1980. Retail trade is
the second largest area of employment, accounting
for about 21. Next is state government
employment, which would include employment by
Montana State University and other state entities
with employees in the area. The fourth largest
sector for employment is construction about 9.
 

   
     

 
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Consolidation and Decline in Area Longstanding
Industries   The chart below shows labor income
trends for four longstanding area industries
agriculture, as measured by net farm earnings
lumber and wood products manufacturing mining of
all types and railroads. Labor earnings for all
of these industries are then combined in the
upper right chart and compared to area labor
earnings and personal income overall. Since
1990, labor earnings of these industries have
gradually fallen from 39 million to 31 million.
Meanwhile, growth in labor earnings from all
sources and total personal income has
accelerated. This is steadily reducing area
dependency on these traditional sectors of the
economy.
 

   
     

 

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Gallatins Struggling Ag Sector  By examining
income and expenses for area agriculture over a
long period of time, you can see how difficult
financial conditions are for ag producers. The
chart below shows annual cash marketing receipts
in relation to cash production expenses. Area
producers have steadily reduced expenditures.
But every reduction has been matched by
reductions in cash marketings. Other sources of
farm income, including farm program payments and
off-farm income, are sometimes the margin of
difference between net losses and net gains.
 

 
   
     

     

 
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However, the same is not the case in Madison
County. With the exception of the late 80s and
early 90s, net farm income has been negative in
Madison County, with and without other income.
Ag Trends in Park and Madison Counties  Cash
receipts for livestock and crop marketings in
nearby Park and Madison Counties ordinarily lag
behind production expenses. And farm program
payments to ag producers are fairly limited in
both counties. This makes financial conditions
for farmers and ranchers precarious. In Park
County, income from other sources to ag
producers has increased substantially in recent
years (these other sources are not identified
specifically and can only be speculated about).
This outside income has resulted in positive net
income for ag producers in Park County.
 

 
   
     

     

 
With little profitability currently in area
agriculture and with continuing area population
growth, it can be expected that ag land will
continue to face pressure for conversion through
some type of development.
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Areas of Concentrated Growth in the Bozeman Area
Economy   There are three important areas of
concentrated growth in the Gallatin economy. The
influx of more people to the area has spurred
construction and real estate development activity
(as shown below). And virtually all aspects of
the area economy affected by travel and tourism
are growing (as shown in the upper right). But
more fundamentally, the services led expansion in
the economy can be seen in more detail in the
lower right chart. Three of the most important
sub-sectors within services more generally
health care, business services, and engineering,
management, and legal services are all growing
rapidly, as are financial services and insurance
within the large F.I.R.E. sector.
 

 
   
     

     

 
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Area Manufacturing Trends  Most areas of the
United States are seeing little growth, if not
decline, in their manufacturing sectors, largely
because of increasing global competition.
However, one of the significant features of
recent economic expansion in the Bozeman area is
growth in manufacturing. The chart below shows
labor earnings by those employed in area durable
and nondurable manufacturing. Growth is focused
in durables manufacturing and important
sub-sectors of this are shown in the upper right.
Sub-sectors within nondurable manufacturing are
shown in the lower right.
 

 
   
     

     



 
 


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Other Areas of Growth   As the Bozeman economy
has grown and restructured, it has also seen
significant growth in wholesale trade. This
sector has seen expansion almost since the early
80s, which is quite unusual. The communications
sector has been somewhat erratic. And trucking
and warehousing and air transportation have seen
small but steady growth.   Among governmental
sectors, state government, including Montana
State University, has expanded considerably, with
labor earnings by employees rising from 90
million in 1990 to over 170 million more
recently. Local government, including public
education, is growing at a gradual rate. Labor
earnings by persons employed by the federal
civilian government in the area are growing as
well.
 

 
   
     

     



 

 


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Rapidly Growing and Declining Sub-sectors in
Gallatin County
The Bozeman area economy is undergoing constant
change. In the last decade, there was great
change and restructuring in the economy, with
growth focused in many service, trade, financial,
and construction sub-sectors and decline
concentrated in several more traditional
industries. The greatest decline was in
agriculture, where net farm earnings fell by 3.7
million or 20 between 1990 and 2000.   There
are 76 sub-sectors of the economy and the very
fastest growing one is business services, which
grew by over 43 million and 186 during the
period.
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Rapidly Growing and Declining Sub-Sectors In
Missoula County
The Missoula economy is undergoing constant
restructuring and change with growth focused in
many service, trade, financial, and construction
sub-sectors and decline concentrated in
traditional industries like lumber and wood
products manufacturing, other manufacturing, and
agriculture. Many of these fast-growing
sub-sectors can only grow and thrive in largely
urban-based economies.
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Rapidly Growing and Declining Sub-Sectors In
Flathead County
The Flathead economy is undergoing significant
restructuring and change with growth focused in
many service, trade and construction sub-sectors
and decline concentrated in traditional
industries including primary metals
manufacturing, wood products, railroads and
agriculture.
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Recent Improvements in Area Economic Well-being
  The 1980s were a difficult time economically
for the area. Per capita income grew only
slowly, median family incomes fell, and poverty
rates rose. However, this changed considerably
in the 1990s, where by nearly every measure, area
economic well-being improved considerably. In
Gallatin County, per capita income has risen
fairly aggressively in recent years.
 
 

 
   
     

     



 

 


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Keys Propositions in Bozemans Economic
Future   Cities as Economic Engines Cities in
Montana have become the settings if not the
engines of economic growth, diversification, and
advancement, as is the case in the larger region.
They are growing centers of education, health
care, entertainment, culture, business and
finance. The greatest growth and prosperity
will center and expand in cities of quality.
Tend to and plan well for this growth.   Fast-grow
ing Larger Region The larger Rocky Mountain West
region Western Montana, Idaho, Utah, Wyoming,
Colorado is one of the fastest growing regions
in North America. Quality cities in this region
with quality businesses and quality workers will
likewise grow and prosper.   Nearby
Highly-valued Amenities Open lands, mountains,
forest lands, free-flowing streams, and similar
amenities help support a high quality of life for
area residents and have become magnets to new
migrants in the region. These amenities are all
defining features of surrounding and nearby
landscapes of Bozeman. They have become key
economic assets.   Human-Resource Based Economy
While natural resource based segments of the
regions economy remain important, growth is
increasingly focused in areas such as health
care, financial services, business and
professional services, construction and real
estate. The economy is more and more
human-resource based. Well-designed,
well-funded, adaptive systems for education and
work force development in the city and region are
essential for continuing economic
advancement.     Build new structures and
networks for public-private leadership
development and interaction. Look forward.
Anticipate and position yourself for future
change. Become a learning community. Become a
more aware, adaptive and successful community.
Pursue opportunity.
 
 

 
   
     

     



 

 


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Bozemans Primary Economic Opportunity and
Challenge   Area economic restructuring has been
difficult for many areas of the West,
particularly areas with small populations that
have not seen recent population growth. In the
Bozeman area, this restructuring is being
accompanied by fairly rapid population and income
growth that is translating into growth in many
important areas of the economy. A new economy is
emerging in Bozeman as a result of this growth
and change. The primary opportunity lies in
using this growth as a bridge in the continuing
process of re-tooling and transitioning the
areas economy, better positioning Bozeman and
area communities for future economic
prosperity.   The primary challenge lies in not
permitting the very qualities that bring more and
more people and businesses to the Bozeman area to
be irreparably degraded and lost as this growth
continues. In order for growth to be sustained
and in order for growth to provide both
quantitative and qualitative gains for the area,
it must be managed and guided.
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Framework for Community and Regional Economic
Positioning  Pursue Economic Improvement at
Sub-State Levels To be successful, economic
development initiatives must reflect underlying
and emerging area strengths and weaknesses. So,
economic development strategies and approaches
must vary from place to place. Dont look for
one-size-fits-all state-wide approaches.   Get
your region right Pursuing economic
development city-by-city or county-by-county is
difficult. Influencing area economic conditions
and trends in positive ways requires capacity,
best achieved at the regional level, by people,
businesses, and communities occupying common
sub-state economic regions working
together.   Know that Economic Development is
more than Business Development Its more than
business retention, expansion, and sometimes
recruitment all traditional focuses of ED. But
it also entails strategic decisions and plans
regarding infrastructure and housing, workforce
development and education more generally, and
area planning.   Build Structures and Networks
for Public-Private Leadership Interaction and
Development Build and nurture a network of
people and organizations, cutting across private
and public spheres, to sustain discussions about
economic development and to sustain efforts and
initiatives coming from these discussions. The
Big Table   Regionally Develop Healthy
Urban-Rural, Community-to-Community Partnerships
Within real economic regions, the economy does
not recognize bounds of urban and rural. It
operates across them. Partnerships for area
economic improvement also must cross lines of
urban and rural, while respecting and recognizing
important differences in each. Build around
areas of mutual need and benefit. Build trust by
working together.   Become a Learning Community
and a Learning Region Area economic
development is never finally attained. It can
only be pursued. It is a constant matter of
attempting to position yourself your
businesses, organizations, workers, families,
schools, etc. for future change. Positioning
for change requires constant learning,
systematically pursued by key area leadership and
the larger community.   Agree upon a Compelling
and Realistic Vision for the Future Imagine
where you want to be in the future, taking stock
of where you are today and where you were in the
past. Visualize what you want your community and
region to look like. Identify steps and measures
lying between where you are now and where you
want to be in the future and pursue them in
deliberative, inter-coordinated and sustained
ways. Make course corrections as necessary.
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Framework for Economic Success in the Bozeman
Area   Project Bozeman into the larger region
See yourself as an emerging city in he
fast-growing Rocky Mountain West. Project this
vision forward.   Attend to Key Foundations for
Future Economic Success Key elements for
economic success extend beyond business
development and assistance. To be competitive
with other cities in the region, you must
have   - Quality Infrastructure
streets, water, sewer, schools, parks,
neighborhoods, office buildings and
complexes, business centers, educational
facilities, downtown, etc., develop a vision
for what you want the city to be
and put it into place   - Quality
Workforce adaptive well-stratified workforce,
with access to good training and education
programming tailored to the particular
needs and opportunities of area employers. The
area COT and MSU-B working in
tandem with area workforce training
programs.   Adapt to Changing Area Age
Demographics Recognize the ebbs and flow of
population growth across differing age groups and
factor these into plans for housing, health care,
school enrollment, workforce development, etc.
  Twin Strategies for Business Development and
Workforce Development using Clusters Stratify
current and potential employers in the area into
clusters and customize strategies for each
cluster.   Chart and Assess Your Progress using
Peers Understanding change in your own
community requires understanding change in the
larger region and among cities and regions like
yours.   Establish an Economic Development
Roundtable Key leadership in the community
extending across business assistance, education,
workforce development, infrastructure, and city
planning must regularly meet in order that this
type of multi-faceted approach can be developed
and pursued.   Build Healthy Urban-Rural
Partnerships for Progress in the Region The
futures of Bozeman and its surrounding
communities are inextricably linked. You are not
competitors. You are allies.
 
 

 
   
     

     



 

 


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Total Tax Revenues in Montana In actual dollars
or dollars unadjusted for inflation, state and
local tax revenues from all sources have steadily
risen over time, as shown in the top chart. This
rise is much less pronounced when these dollar
amounts are adjusted for inflation, as shown in
the lower chart. Source 1998 2000
Biennial Report, Montana Dept. of Revenue
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Montana Tax Revenues as a Share of Income
Actual tax collections as a share of total
personal income reflect the size of the states
tax burden in relation to the size of Montanas
economy.
Tax revenues as a share of income Have steadily
fallen from as high as 10.24 in 1985 to a low of
7.78 in 2002. State revenues are not growing as
fast as are incomes.
Source 2000-2002 Biennial Report, MT Department
of Revenue
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