Montana records strong wage growth since early 2021

This story is excerpted from the MT Lowdown, a weekly newsletter digest containing original reporting and analysis published every Friday.

The administration of Gov. Greg Gianforte, specifically the state Department of Labor and Industry, published its annual Labor Day report on the status of Montana’s economy last week. As has long been tradition under both Democratic and Republican governors, the report emphasizes the bright spots in the state’s economic performance — among them, strong wage growth since Gianforte took office at the beginning of 2021.

According to the report, which compiles a variety of statistics from state and federal economic agencies, Montanans’ personal income has grown at 7.5% a year since 2020, the fourth-fastest rate in the nation. As of 2023, the average Montana income was up to nearly $64,000 a year, a figure that’s middle-of-the-pack nationally.

Of course, the notable inflation of recent years — for housing in particular — means Montanans also face higher prices for the things they’d like to buy, regardless of whether they’ve seen commensurate wage increases. According to the national consumer inflation index published by the U.S. Bureau of Labor Statistics, it took an estimated $1.17 in December 2023 to match the purchasing power of a Jan. 1, 2021, dollar.

Additionally, the statewide average income growth figure doesn’t necessarily reflect what individual Montanans in different industries, income brackets and parts of the state have experienced with their personal finances over the past four years. The chart above, for example, compares inflation-adjusted wage growth for workers across different segments of the economy, showing that wage growth has kept pace with inflation or outstripped it entirely in some fields, while lagging in others.

Wages for Montana’s professional service workers — architects, veterinarians and lawyers, among others — have in aggregate risen 3.1% faster than inflation, the labor department says. On the other end of the spectrum, however, is education, where wages for teachers and other education workers declined by 2.7% relative to the cost of living.

Asked what he’s doing to ensure Montana’s public sector wages keep up with the cost of living at a press conference last Wednesday, Gianforte pointed to the 2021 TEACH Act, which authorized incentives intended to boost starting teacher pay. He also noted that the state pay plan negotiated with public employee unions and passed by the Legislature last year provided state and Montana University System employees with across-the-board raises of 4% or $1.50 an hour, this year and last.