At the end of fiscal year 2022, Montana saw a 39 percent increase in collections from its top seven taxes. Through the first 10 months of the current fiscal year, those same taxes had produced 3 percent less, according to the Bureau of Business and Economic Research at the University of Montana.
Most of the larger industries in the state, with the exception of construction and tourism, went into reverse, according to the BBER. Inflation, rising interest rates, high housing prices and falling global commodity prices also affected the economy.
However, a July 12 article in The Valley Journal reported new business registrations in the state surged in June. The Secretary of State’s office reported about 5,300 new businesses were registered, compared to the some 4,300 new registrations in June 2022.
Montana is expected to have another record year for new business registration, with more than 30,000 reported to date. McKee Anderson, president of the Montana Food Distributors Association, said the state’s economy is much stronger now than a year ago.
“Montana is an ag-dominated state and commodity prices are much stronger, with unemployment at record low levels and a strong increase in average earning in the labor market.”
Independent grocers in the state are continuing to deal with inflation and post-pandemic challenges such as workforce and supply chain issues. However, Anderson said the independents are “a very strong and resilient group.”
“To quote a member [Robert Plouffe] doing business in a small farming community, ‘Life is good with the strong economy, and we just have to stay with competition on wages, benefits and issues of supply management. We pay good employees competitively and our offerings are expanding with a strong supply and good selection.’”
Speaking to inflation, Anderson said due to the mark-up percentage being percentage based, the association’s members are seeing increased earnings, which so far has offset – and in some cases outpaced – the increased cost of doing business. “Customer price shopping has increased, but the long distances in Montana control it to a degree.”
Anderson said the MFDA supported legislation this year addressing inventory and business asset tax relief. It also is working on “milk control issues that have created a quasi-monopoly for a processor.”
Although the Montana economy is strong, change is always on the horizon.
“Change is inevitable, and therefore we must accept it, evaluate it and manage our business to take advantage and benefit from it, thereby maximizing our earnings and business footprint,” Anderson said.
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