Economists: Steady Growth Expected to Continue in the Flathead Valley
At the 50th annual Montana Bureau of Business and Economic Research economic outlook seminar in Kalispell, panelists said the area will continue to see steady growth as in-migration remains a strong economic driver despite stubborn inflation and high interest rates
By Maggie Dresser
Following years of uncertainty since the pandemic upended the global economy, nationwide and local growth remains steady despite continued inflation and high interest rates, according to economists who presented Tuesday at the 50th annual University of Montana Bureau of Business and Economic Research (BBER) economic outlook seminar in Kalispell.
Economic growth in recent years has exceeded forecasts, but experts stress that a recession is still possible as the country enters a “period of policy uncertainty.”
“In the past couple of years, the economy has done relatively well, and it sort of looked like, hey – the soft landing is kind of happening,” BBER Director Jeffrey Michael told an audience at Flathead Valley Community College.
While uncertainty remains surrounding the impacts of President Donald Trump’s potential tariffs of 25% on Canada and Mexico and 10% tariff on China could have on inflation, the current 2% goal has remained out of reach.
But inflation has not stopped Flathead County’s growth trajectory, which continues to chug along as building, tourism and a high volume of in-migration remain strong. Following a drop off since the peak pandemic years in 2020 and 2021, Montana’s economy has steadily climbed.
“We’re seeing more of the same,” BBER research director and the organization’s former longtime director Pat Barkey said. “We’re seeing growth that’s a little bit more reserved – not just in the Flathead – we’re seeing that across the state.”
In-migration has slowed in Flathead County, peaking at about 3,500 new residents in 2021 and dropping to about 2,000 the following year. And while growth has continued to decrease, Barkey says the longterm trend has resulted in a strong economic driver.
“Most of your migration is not coming from within Montana,” Barkey said. “It’s coming from outside of Montana.”
An increase in airport activity has been an indicator of growth, with the Glacier Park International Airport seeing a 12.8% spike last year in passenger travel compared to 2023. Experts attribute this rise not only to tourism, but to residents.
“Glacier [National] Park International Airport had the highest amount of traffic ever,” Kalispell Chamber of Commerce CEO Lorraine Clarno said. “Over a million folks went through those doors and if you talk to our airport manager Rob Ratkowski, he will make sure you know that it is not all visitors. The majority of that, he believes, is business travel and residents.”
Clarno said business continues to boom in Kalispell, with the northern part of the city seeing increased commercial development with the addition of a new Costco, two new hotels and office spaces opening up. The Kalispell Center Mall was recently purchased by out-of-state developers who plan to revitalize the building, and a new Amazon distribution center is slated to break ground on the southern edge of the municipality.
While commercial building permits have increased by 14% from 2023 to 2024, residential permitting in Kalispell has declined from 878 permits in 2021 to 577 last year.
“Multifamily has really slowed down, but we have a lot of multifamily units now coming online,” Clarno said.
As the population growth drives the Flathead Valley’s economy, Clarno said it remains vital to invest in the community’s resources and she praised the passage of Kalispell’s $4.6 million Emergency Responder Levy last year. However, she stressed the importance of passing the upcoming high school levy for School District 5, which has not passed a levy in almost two decades.
“Education – a community is only as good as its education system and our School District 5 is doing an outstanding and amazing job,” Clarno said. “It’s actually a model for high school education across the state.”
“We’re going to keep growing – it’s going to be nice and steady,” Clarno added. “We have lots of opportunity, but I think it’s really imperative that we realize that prosperity doesn’t just happen. We have to work together. We have to collaborate. We have to bring partners together to ensure that we’re setting the stage for the next decade or two in our community.”