Economy/Cost of Living

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Montana enjoys an astonishingly stable economy, as well as a low cost of living. A small population and a historical dependence on the utilization of natural resources have limited the state’s relative economic impact, but recent diversification efforts have led a gradual transformation to a modern, service-oriented economy.

Montana’s economy has been safeguarded by both its size and diversity. Montana is one of several western states plagued by low incomes, which critics have erroneously taken as an indication of a low standard of living. Indeed, the opposite is true. Montana does have one of the lowest per capita incomes in the U.S., but a low cost of living equalizes this difference. For example, in 2000, Montana’s per capita personal income was $22,518, 24% lower than the U.S. average of $29,469, while the 2000 median single-family home price was $115,000, 30% lower than the national median of $162,900. According to 2000 Census data, Montana also had a higher-than-average homeownership rate, 69.1% compared to the national average of 67.4%.

While Montana’s economy has become service-oriented, a large portion of the economy remains dependent on natural-resource industries, such as agriculture, beef cattle, timber and coal. Importantly, Montana’s state legislature has created new strategies to further diversify, expand and strengthen the economy. The Office of Economic Opportunity, created by Governor Judy Martz, fosters high technology, knowledge-based industries through tax incentives and various support programs.

There are several programs of interest to business development in Montana, with more under consideration. The Business Resource Division of the Department of Commerce and its Finance Information Center provide information on many of these, including:

There are also numerous tax incentives available to businesses and investors in Montana, including:

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