Montana Could Be Hit Harder by Tariffs, Economic Report Says

Montana may feel the sting of tariffs more than other states, according to new findings from the University of Montana’s Bureau of Business and Economic Research (BBER). The organization kicked off its annual midyear economic update in Helena on Monday, the first stop in a seven city tour across the state.

Uncertainty Clouds Outlook for Tariffs

BBER Director Jeff Michael said it’s tough to make firm predictions because the policies surrounding tariffs are constantly shifting. Michael explained that making economic predictions right now is especially difficult because of constant changes and a high level of uncertainty surrounding current policies and market conditions.

Tariffs Hit Key Montana Sectors

This year’s report is titled “Taxes, Tariffs and Trade Wars” and focuses heavily on how trade policy affects Montana’s economy. While some sectors of the U.S. economy, like large-scale manufacturing, may benefit from tariffs, Montana’s economy leans more heavily on agriculture and construction, industries that could face higher costs and increased instability.

READ MORE: Montana Lawmakers Back Plan to Charge Foreigners More to Visit National Parks

According to KTVH, Michael pointed out that while Montana isn’t likely to benefit from an expansion in car manufacturing, the state’s existing manufacturing sector relies heavily on steel, which is becoming more expensive due to tariffs.

Tourism Likely to Stay Strong

Unlike some economic experts, Michael doesn’t believe tariffs or trade tensions will seriously hurt Montana’s tourism industry. While there’s been a drop in Canadian visitors, he said they make up a small slice of the state’s tourist base. He added that Americans may be more likely to vacation within the country, possibly helping Montana’s numbers.

Population Growth Slows, But Impacts Remain

Montana saw rapid population growth during the COVID-19 pandemic, peaking in 2021. That growth has since slowed, but the effects are still being felt in housing costs and overall affordability. Michael noted that while people still appreciate the Montana lifestyle, the rising cost of living is making it harder to afford, leading some residents to consider moving elsewhere for more affordable housing, according to KTVH.

Wages and New Business Filings Show Promise

Despite the concerns, there were bright spots in the report. Wage growth continues across the state, and new business filings and income tax collections remain strong.

Tax Policy Changes Raise Questions

KTVH also reports that Michael discussed recent tax legislation, including federal changes that benefit seniors and self-employed Montanans, and state-level property tax reforms passed during the latest legislative session. He said the impacts of those property tax changes are hard to predict and vary by region. For example, counties like Meagher may see more significant relief, while residents in Missoula may see smaller reductions.

Chamber of Commerce Voices Concerns

Todd O’Hair of the Montana Chamber of Commerce raised concerns that recent property tax changes could unfairly increase costs for businesses. He called for a broader review of the state’s tax system and suggested that considering a general sales tax should be part of future policy discussions.

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Economic Tour Continues

BBER’s economic update tour landed in Great Falls on Tuesday. On Thursday, it will be in Kalispell and next week will be in Billings on Tuesday, Bozeman and Butte on Wednesday, and Missoula on Thursday.